RBI imposes monetary penalty on Sri Basaveshwara Pattana Sahakara Bank Niyamit, Sindgi, Karnataka

Case Brief

RBI, by order dated December 18, 2024, imposed a monetary penalty of ₹1.00 lakh on Sri Basaveshwara Pattana Sahakara Bank Niyamit, Sindgi, Karnataka. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949, following a statutory inspection with reference to the bank’s financial position as on March 31, 2023. RBI found that the bank had not adhered to directions issued under the Supervisory Action Framework (SAF), specifically by increasing exposure to a sector with high NPAs and declaring dividend without prior permission of RBI. RBI stated that the penalty is based on regulatory compliance deficiencies and does not pronounce on the validity of transactions with customers.