RBI imposes monetary penalty on New India Co-operative Bank Ltd., Mumbai, Maharashtra

Case Brief

By an order dated August 26, 2021, RBI imposed a monetary penalty of ₹25 lakh on New India Co-operative Bank Ltd., Mumbai, Maharashtra. The penalty was levied for non-compliance with RBI directions contained in the circular on ‘Frauds in UCBs: Changes in monitoring and reporting mechanism’ dated May 19, 2016. RBI said the issue emerged from its statutory inspection of the bank with reference to its financial position as on March 31, 2019, followed by examination of the inspection report and related correspondence. After issuing a show-cause notice and considering the bank’s reply and oral submissions, RBI concluded that the charge was substantiated and that penalty was warranted under section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.