RBI imposes monetary penalty on The Aurangabad District Central Co-operative Bank Limited, Bihar

Case Brief

By an order dated October 22, 2024, RBI imposed a monetary penalty on The Aurangabad District Central Co-operative Bank Ltd., Bihar. The bank was penalized for contravention of section 26A read with section 56 of the Banking Regulation Act, 1949, and for non-compliance with RBI directions on Membership of Credit Information Companies (CICs) by Co-operative Banks. RBI noted that the bank failed to transfer eligible amounts to the Depositor Education and Awareness Fund within the prescribed period and failed to submit credit information of its borrowers to any of the four Credit Information Companies. The penalty was imposed after supervisory findings, issuance of a show-cause notice, and consideration of the bank's reply and oral submissions. RBI clarified that the action is based on regulatory deficiencies and does not pronounce on the validity of any transaction or agreement.