RBI imposes monetary penalty on Shri Basaveshwar Sahakari Bank Niyamitha, Bagalkot, Karnataka

Case Brief

The Reserve Bank of India imposed a monetary penalty of ₹1 lakh on Shri Basaveshwar Sahakari Bank Niyamitha, Bagalkot, Karnataka, following a statutory inspection with reference to its financial position as on March 31, 2024. RBI said the bank had failed to comply with directions on Income Recognition, Asset Classification, Provisioning and Other Related Matters – UCBs and the Reserve Bank of India (Co-operative Banks - Interest Rate on Deposits) Directions, 2016. After supervisory findings, a notice, the bank's reply, and oral submissions, RBI sustained the charges that the bank had not classified certain loan accounts as non-performing assets and had opened certain savings deposit accounts in the name of ineligible entities. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.