RBI imposes monetary penalty on five co-operative banks. Details here

The Reserve Bank has fined five cooperative banks due to noncompliance with regulations. Uma Co-operative Bank Ltd, Pij People's Co-operative Bank Ltd, Mizoram Co-operative Apex Bank Ltd, Birbhum District Central Co-operative Bank Ltd, and Shihori Nagarik Sahakari Bank Ltd are all examples of cooperative banks.

For violating RBI's guidelines on "Placement of Deposits with Other Banks by Primary (Urban) Co-operative Banks (UCBs)," Uma Co-operative Bank Ltd., Vadodara, Gujarat, was fined 7.00 lakh. According to the central bank, Uma Co-Operative Bank exceeded both its interbank counterparty exposure limit and its interbank gross exposure limit.

For failing to comply with the RBI's 'Reserve Bank of India (Know Your Customer (KYC)) Directions, 2016', the Pij People's Co-operative Bank Limited in Pij, Dist. Kheda, Gujarat was fined 2.00 lakh. The Pij People's Co-operative Bank was cited for failing to perform a required periodic review of the risk categories assigned to customer accounts.

For failing to follow RBI's guidelines on 'Housing Finance' for State Co-operative Banks, the Reserve Bank levied a fine of 2.00 lakh upon Mizoram Co-operative Apex Bank Ltd., Aizawl. According to the apex bank, the Mizoram Co-operative Apex Bank's exposure to housing finance as a whole is too high.

For failing to comply with the RBI's 'Reserve Bank of India (Know Your Customer (KYC)) Directions, 2016' and 'Membership of Credit Information Companies (CICs)', the Reserve Bank of India (RBI) imposed a monetary penalty of 1.10 lakh on Birbhum District Central Co-operative Bank Ltd., Birbhum, West Bengal. Birbhum District Central Co-operative Bank (i) failed to conduct periodic evaluation of risk categorisation of accounts, (ii) failed to perform risk categorisation of a number of accounts, and (iii) failed to secure membership of three out of the four CICs, according to the banking regulator.

Financial penalties totaling 1.00 lakh were levied by the Reserve Bank of India (RBI) against Shihori Nagarik Sahakari Bank Ltd., Shihori, Dist. Banaskantha, Gujarat for failing to follow RBI guidelines regarding "Loans and advances to directors, relatives, and firms or concerns in which they are interested" as well as "Loans and advances to Directors etc. - Directors as surety or guarantors - Clarification" and " The Reserve Bank said that the Shihori Nagarik Sahakari Bank had violated the prescribed inter-bank counterparty exposure limit and authorized loans with guarantors who were relatives of bank directors.

The Reserve Bank took these measures because the banks were not in full compliance with regulations; they were not meant to rule on the legality of any particular transaction or arrangement that the banks might have had with their customers.