RBI Imposes Fines On 2 Co-operative Banks For Failing To Comply With Regulations

The Reserve Bank of India (RBI) has imposed monetary penalties on two co-operative banks, it said in two separate press releases on Wednesday.

A penalty of Rs 10 lakh has been imposed on Millath Co-operative Bank, based in Davangere, Karnataka, "for non-adherence / violation of All-Inclusive Directions and other directions imposed on the bank."

Further, RBI imposed a penalty of Rs 5 lakh on The Thiruvaikuntam Co-Operative Urban Bank Limited, Thoothukudi District, Tamil Nadu including for "for contravention of the directions issued by RBI on prohibition of loans and advances to Directors."

"This penalty has been imposed in exercise of powers vested in RBI under the provisions of Section 47 A (1) (c) read with Section 46 (4) (i) and Section 56 of the Banking Regulation Act, 1949, taking into account the failure of the bank to adhere to the aforesaid directions issued by RBI," the central bank said for both the cases.

"This action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers," it added.