Reserve Bank of India imposes monetary penalty on The Hyderabad District Co-Operative Central Bank Ltd., Hyderabad, Telangana

Case Brief

The Reserve Bank of India imposed a monetary penalty of ₹2 lakh on The Hyderabad District Co-Operative Central Bank Ltd., Hyderabad, Telangana, by order dated February 9, 2022. RBI said the bank had violated / not complied with certain directions in the circular on income recognition, asset classification and provisioning for co-operative banks, and had also failed to transfer eligible funds to the Depositor Education and Awareness Fund under Section 26A of the Banking Regulation Act, 1949 (AACS). The action followed an inspection report based on the bank’s financial position as on March 31, 2020, a show-cause notice, and consideration of the bank’s written and oral submissions. RBI clarified that the penalty was for deficiencies in regulatory compliance and did not pronounce on the validity of any transaction or agreement with customers.