Rani Laxmi Bai Urban Co-operative Bank Ltd., Jhansi, Uttar Pradesh – Penalised

Case Brief

The Reserve Bank of India imposed a monetary penalty of ₹5,00,000 on Rani Laxmi Bai Urban Co-operative Bank Ltd., Jhansi, Uttar Pradesh. The penalty was levied under Section 47A(1)(c) read with Section 46(4) of the Banking Regulation Act, 1949 (as applicable to co-operative societies), after RBI found violations of instructions and guidelines on Membership of Credit Information Companies, Prudential Norms on Inter-bank Counter Party Limit, Audit Committee of the Board, income recognition, asset classification, provisioning and other related matters for UCBs, KYC/AML guidelines, and concurrent audit of investment transactions. RBI had issued a show-cause notice, the bank replied in writing, and RBI ultimately concluded that the violations were substantiated and merited penalty.