RBI imposes monetary penalty on Warud Urban Co-operative Bank Ltd., Warud (Maharashtra)

Case Brief

The Reserve Bank of India imposed a monetary penalty on Warud Urban Co-operative Bank Ltd., Warud, Maharashtra, for contravention of and non-compliance with RBI directions issued to urban co-operative banks on Exposure Norms & Statutory/Other Restrictions and Know Your Customer (KYC). RBI said the bank failed to adhere to the prudential inter-bank counter party limit and had not put in place a robust software system to identify and report suspicious transactions effectively. The penalty was imposed under Section 47A(1)(c) read with Section 46(4)(i) and Section 56 of the Banking Regulation Act, 1949, after considering the bank's replies and oral submissions.