RBI imposes monetary penalty on The Bihar State Co-operative Bank Ltd., Patna

Case Brief

RBI, by order dated August 30, 2021, imposed a monetary penalty of ₹5.00 lakh on The Bihar State Co-operative Bank Ltd., Patna. The penalty was levied for non-compliance with NABARD directions contained in its circular on “Review of Frauds - Guidelines on Monitoring and Reporting System”. The action followed NABARD’s statutory inspection and RBI’s examination of the inspection reports and related correspondence, which revealed the violation. RBI issued a show-cause notice, considered the bank’s reply and oral submissions, and then concluded that the charge was substantiated under the Banking Regulation Act, 1949.