RBI imposes penalty on Mula Sahakari Bank Limited in Maharashtra's Ahmednagar for non-compliance of direction

Ahmednagar (Maharashtra) [India], January 29 (ANI): The Reserve Bank of India (RBI) has imposed a penalty of Rs 50,000 on Mula Sahakari Bank Limited, Sonai, district Ahmednagar, Maharashtra for non-compliance with the directions issued by the RBI.
"The Reserve Bank of India (RBl) has, by an order dated January 8, 2024, imposed a monetary penalty of RS 50,000/- (Rupees fifty thousand only) for non-compliance with the directions issued by the RBI on 'Exposure Norms and Statutory/Other Restrictions--Urban Co-operative Bank's (UCB)," as per an official statement issued on Monday.
This penalty has been imposed in the exercise of powers conferred on RBI under the provisions of Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
This action is based on a deficiency 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.
As per the RBI, the statutory inspection of the bank conducted by the RBI with reference to its financial position as on March 31, 2022, and examination of the Risk Assessment Report and all correspondence related thereto revealed, inter alia, that the bank had breached the inter-bank counterparty exposure limit.
"Consequently, a notice was issued to the bank advising it to show cause as to why a penalty should not be imposed on it for failure to comply with the said directions, as stated therein," the RBI said in its release.
After considering the bank's reply to the notice and oral submissions made by it during the personal hearing, the RBI concluded that the charge of non-compliance with the aforesaid RBI directions was substantiated and warranted the imposition of a monetary penalty on the bank. (ANI)