Reserve Bank of India imposes monetary penalty on Shree Mahayogi Lakshmamma Co-operative Bank Ltd., Kurnool, Andhra Pradesh

Case Brief

The Reserve Bank of India imposed a monetary penalty of ₹1.00 lakh on Shree Mahayogi Lakshmamma Cooperative Bank Ltd., Kurnool, Andhra Pradesh, for non-compliance with RBI directions on Income Recognition, Asset Classification, Provisioning and Other Related Matters for UCBs. An inspection based on the bank’s financial position as on March 31, 2021 found that the bank did not classify certain loan accounts as non-performing assets in accordance with IRAC norms. RBI issued a show-cause notice, considered the bank’s reply and oral submissions, and concluded that the contravention was substantiated, warranting penalty under the Banking Regulation Act, 1949 (AACS).