RBI imposes monetary penalty on The Valsad Mahila Nagarik Sahakari Bank Ltd., Dist. Valsad, Gujarat

Case Brief

By an order dated August 14, 2024, RBI imposed a monetary penalty on The Valsad Mahila Nagarik Sahakari Bank Ltd., Valsad, Gujarat. The action followed a statutory inspection as of March 31, 2023 and subsequent supervisory proceedings under which RBI found sustained contraventions of directions relating to income recognition, asset classification and provisioning, membership and reporting to credit information companies, KYC norms, and maintenance of deposit accounts for primary (urban) co-operative banks. RBI recorded that the bank had failed to classify certain loan accounts as NPAs, failed to submit data including historic data to three CICs, failed to perform risk-based periodic KYC updation, and failed to mark certain accounts as dormant/inoperative after more than two years without customer-induced transactions. RBI stated the penalty was based on deficiencies in regulatory compliance and without prejudice to any other action that may be initiated.