RBI imposes monetary penalty on the National Urban Co-operative Bank Limited, Pratapgarh, Uttar Pradesh

Case Brief

The Reserve Bank of India imposed a monetary penalty of ₹5.00 lakh on National Urban Co-operative Bank Limited, Pratapgarh, Uttar Pradesh, by order dated August 22, 2022. The penalty was for non-compliance with RBI directions in the Master Circular on Income Recognition, Asset Classification, Provisioning and Other Related Matters for UCBs, after inspection findings showed that the bank failed to identify certain accounts as non-performing assets. RBI stated that the action was taken under Section 47A(1)(c) read with Section 46(4)(i) and Section 56 of the Banking Regulation Act, 1949, and clarified that the penalty was based on regulatory-compliance deficiencies and not intended to pronounce on the validity of any transaction with customers.