Mumbai: The Reserve Bank of India (RBI) has taken action against several cooperative banks in Gujarat, imposing monetary penalties for non-compliance with its directives. The central bank has fined five banks, namely Vadnagar Nagarik Sahakari Bank Ltd. in Vadnagar, People’s Co-operative Bank Ltd. in Dholka, The Chhapi Nagarik Sahakari Bank Ltd. in Banaskantha, Mahila Co-operative Nagrik Bank Ltd. in Bharuch, and Surat National Co-operative Bank Ltd. in Surat.

The RBI issued orders specifying the penalties imposed on these banks. The penalties are as follows:

1. Vadnagar Nagarik Sahakari Bank Ltd., Vadnagar, Gujarat

~ Monetary Penalty: ₹2.00 lakh (Rupees Two lakh only)

~ The bank had (i) sanctioned a loan where relative of one of the directors of the bank, stood as guarantor, and (ii) not paid interest on matured term deposits from the date of maturity till the date of their repayment at the applicable rate.

2. People’s Co-operative Bank Ltd., Dholka, Gujarat

~ Monetary Penalty: ₹3.00 lakh (Rupees Three lakh only)

~ The bank had (i) sanctioned a loan to a relative of one of its directors, and (ii) not paid interest on overdue term deposits from the date of maturity till the date of repayment at the applicable rate.

3. The Chhapi Nagarik Sahakari Bank Ltd., Banaskantha, Gujarat

~ Monetary Penalty: ₹1.00 lakh (Rupees One lakh only)

~ The bank had sanctioned loan to a relative of one of its directors.

4. Mahila Co-operative Nagrik Bank Ltd., Bharuch, Gujarat

~ Monetary Penalty: ₹2.00 lakh (Rupees Two lakh only)

~ The bank had (i) breached inter-bank gross and counterparty exposure limits, and (ii) not carried out review of risk categorization of accounts as per prescribed periodicity.

5. Surat National Co-operative Bank Ltd., Surat, Gujarat

~ ₹6.00 lakh (Rupees Six lakh only)

~ The bank had (i) not paid interest on matured term deposits from the date of maturity till the date of their repayment at the applicable rate and (ii) not provided the facility to customers to respond by ‘Reply’ to the electronic banking transactions related SMSs and email alerts sent by the bank, for instantly reporting unauthorised transactions.

These actions stem from the results of statutory inspections conducted by RBI, which assessed the financial positions of these banks as of March 31, 2022. DeshGujarat