RBI imposes a penalty of ₹5.50 lakh on four Karnataka cooperative banks for regulatory non-compliance.

Banking & Finance

In December 2024, the Reserve Bank of India (RBI) levied a ₹5.50 lakh penalty on four cooperative banks in Karnataka for failing to comply with regulatory guidelines.


      - The penalized banks include Bharat Cooperative Bank Limited, Swami Vivekanand Sahakari Bank Niyamit, Sri Basaveshwara Pattana Sahakara Bank Niyamit, and Manjra Mahila Urban Cooperative Bank Limited, all based in Bengaluru, Karnataka.

      - Bharat Cooperative Bank (BCB) Limited was fined ₹3 lakh for breaching Supervisory Action Framework (SAF) guidelines by approving new loans and advances that exceeded prescribed limits and lacked adequate collateral.

      - Swami Vivekanand Sahakari Bank Niyamit was fined ₹1 lakh for violating exposure norms for Urban Cooperative Banks (UCBs) and failing to meet Know Your Customer (KYC) requirements, including delayed submission of KYC records to the Central KYC Records Registry (CKYCR) and exceeding prudential limits for inter-bank exposure.

Main Point :-   (i) Sri Basaveshwara Pattana Sahakara Bank Niyamit faced a ₹1 lakh penalty for increasing exposure to high Non-Performing Asset (NPA) sectors without prior RBI approval and declaring dividends without RBI consent.

      (ii) Manjra Mahila Urban Cooperative Bank Limited was fined ₹50,000 for failing to upload customer KYC records to the CKYCR within the prescribed timeline.


About RBI

Governor : Sanjay Malhotra
Headquarter : Mumbai
          ____________________________