RBI Action: The Reserve Bank of India has issued an order to impose monetary penalty against 5 cooperative banks. These banks are accused of violating the rules. RBI has given this information on Monday, November 18. This list includes 3 banks from Gujarat and 2 from Bihar.
RBI has imposed a fine of Rs 1.25 lakh on Nawada Central Co-operative Bank Limited, located in Bihar. The National Central Co-operative Bank Limited, Bettiah, Bihar has been fined Rs 4.10 lakh. The Vapor Industry Development Cooperative Bank Limited (Dahod) has been fined Rs 1.50 lakh. The Mansa Nagarik Sahakari Bank Limited (Gandhinagar Gujarat) has been fined Rs 50 thousand. MS Co-operative Bank Limited (Vadodara, Gujarat) has been fined Rs 1.50 lakh.
Why were two banks of Bihar fined?
Nawada Central Co-operative Bank Limited failed to submit information of its borrowers to any of the four CICs. Also failed to establish a system for periodic review of risk classification of accounts at least once in 6 months. National Central Co-operative Bank Ltd. failed to transfer eligible undisclosed amount to the Depositor Education and Awareness Fund within the stipulated time. Failed to submit borrowers’ information to CIC. Also failed to risk classify the accounts of some customers.
Gujarat banks accused of violating these rules
The Vapor Industry Development Cooperative Bank Limited failed to maintain minimum CRR for a few days. It also failed to do periodic update of KYC of some customers and review the risk classification of some accounts at least once in 6 months.
Mansa Nagarik Sahakari Bank Limited failed to pay interest applicable on certain term deposits, which were not claimed after maturity and before the date of maturity till the date of repayment.
MS Co-operative Bank Limited kept the term deposits unclaimed from the date of maturity to the date of its repayment. It also succeeded in updating the KYC of some high-risk customers. Apart from this, other rules related to term deposits were also violated.
