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

Case Brief

The Reserve Bank of India imposed a monetary penalty on The Nawadah Central Co-operative Bank Ltd., Bihar after a statutory inspection and subsequent show-cause process. RBI said the bank had failed to comply with directions on membership of Credit Information Companies (CICs) by co-operative banks and on KYC, including not submitting borrowers’ credit information to any CIC and not maintaining a system for periodic review of risk categorisation of accounts at least once in six months. The penalty was imposed under the Banking Regulation Act, 1949 and the Credit Information Companies (Regulation) Act, 2005.