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The Reserve Bank of India (RBI) has imposed, by an order dated September 01, 2022, a financial penalty of ₹2.00 lakh (Rupees Two lakh solely) on The Nicholson Co-operative Town Bank Ltd., (No.8), Thanjavur District, Tamil Nadu (the financial institution) for non-adherence / violation of instructions issued beneath Exposure Norms and Statutory / Other Restrictions – UCBs. This penalty has been imposed in train of powers vested in RBI beneath the provisions of Section 47 A (1) (c) learn with Section 46 (4) (i) and Section 56 of the Banking Regulation Act, 1949 (AACS), considering the failure of the financial institution to stick to the aforesaid instructions issued by RBI. This motion is predicated on deficiencies in regulatory compliance and isn’t meant to pronounce upon the validity of any transaction or settlement entered into by the financial institution with its clients. Background The inspection report of the financial institution primarily based on its monetary place as on March 31, 2020, revealed, inter alia, breaches pertaining to prudential inter-financial institution publicity restrict, each on the counter celebration in addition to gross stage. Based on the identical a Notice was issued to the financial institution advising it to indicate trigger as to why penalty shouldn’t be imposed for non-compliance with the instructions. After contemplating the financial institution’s reply and oral submissions in the course of the private listening to, RBI got here to the conclusion that the aforesaid fees of non-compliance with RBI instructions have been substantiated and warranted imposition of financial penalty. (Yogesh Dayal) Press Release: 2022-2023/818 |
