Tag Archives: Gujarat

Bank Deposits, Co-Operative Banks, Penalty

RBI penalises Prime Co-operative Bank Ltd., Surat (Gujarat)

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The Reserve Bank of India has imposed a monetary penalty of Rs5.00 lakh  (Rupees  Five Lakh only) on Prime Co-operative Bank Ltd., Surat (Gujarat).

The penalty is for violation of various RBI instructions relating to issuance of Demand Draft/Pay Order by the bank during the period from April 1, 2010 to March 31, 2013.

Way back in 1991, vide Notification No:DBOD.BP.BC.114/C.469 (81)-91 dated 19th April, 1991, Reserve Bank of India, had notified Banks, to issue travellers cheques, demand drafts, mail transfers, telegraphic transfers for Rs. 50,000/- and above by debit to customers accounts or against cheques only and not against cash.

This press release should enable the Banks to further strengthen their internal processes to ensure that there is no slippage of RBI instructions.

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Co-Operative Banks, Penalty

RBI penalises Karjan Nagrik Sahakari Bank Ltd., Karjan Dist.Vadodara (Gujarat)

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The Reserve Bank of India has imposed a monetary penalty of Rs1.00 lakh  (Rupees One Lakh only) on the Karjan Nagrik Sahakari Bank Ltd., Karjan Dist. Vadodara (Gujarat).

This penalty was for violation of RBI instructions relating to KYC norms. The KYC norms are  a set of rules to assist bankers to adhere to good banking practices.

The major attractions in Karjan are its Sari Market and snacks like Samosa and Khaman. The Samosa’s have a variety of fillings to attract a larger clientele.

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Co-Operative Banks, Customer Service, Introduction, Penalty

RBI again imposes penalty on The Bechraji Nagrik Sahakari Bank Ltd., Mehsana (Gujarat)

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Way back in August 2011, RBI had imposed a penalty of Rs1lac on The Bechraji Nagrik Sahakari Bank Ltd., Mehsana (Gujarat). Again in May 2013, RBI has imposed a monetary penalty of Rs 1.00 lakh (Rupees one lakh only) on The Bechraji Nagrik Sahakari Bank Ltd., Mehsana (Gujarat)

This time the penalty is for violation of the RBI Directive No.5 dated April 29, 2003 read with Section 20 of the B.R. Act, 1949, (AACS) by granting loans to directors/relatives.

 

The RBI directive dt.29/04/2003, primarily deals with granting of loans and advances to the directors, their relatives and concerns in which they are interested.

Quote

In this context, the Joint Parliamentary Committee (JPC) which enquired into the stock market scam and matters relating thereto in paragraph 5.66 of its report (extracts enclosed) has made various recommendations. It has recommended that in order to prevent irregularities of the type which surfaced in the case of some of the cooperative banks examined by it, a full ban should be imposed on granting of loans and advances to the directors, their relatives and concerns in which they are interested.

Unquote

 

Well, some cooperative banks seem interested always falling in the wrong books of RBI.

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Co-Operative Banks, Introduction, Penalty

RBI imposes penalty on The Financial Cooperative Bank Ltd., Surat (Gujarat)

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The Reserve Bank of India has imposed a monetary penalty of Rs 1.00 lakh (Rupees one lakh only) on The Financial Cooperative Bank Ltd., Surat (Gujarat).

The penalty was imposed by RBI, in exercise of the powers vested in it under the provisions of Section 47A(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (As applicable to Co-operative Societies),

The monetary penalty was for violation of the RBI instructions by exceeding the ceiling prescribed for inter-bank deposit exposure limit.

The current RBI rules for Inter-bank Exposure Limit of co-operative banks is as under

Prudential Inter-bank (Gross) Exposure Limit

2.4.1 The total amount of deposits placed by an UCB with other banks (inter-bank) for all purposes including call money / notice money, and deposits, if any, placed for availing clearing facility, CSGL facility, currency chest facility, remittance facility and non-fund based facilities like Bank Guarantee (BG), Letter of Credit (LC), etc shall not exceed 20% of its total deposit liabilities as on March 31 of the previous year.

The balances held in deposit accounts with commercial banks and in permitted scheduled UCBs and investments in Certificate of Deposits issued by commercial banks, being inter bank exposures, will be included in this 20% limit.

Prudential Inter-bank Counter Party Limit

2.4.2  Within the prudential inter-bank (gross) exposure limit, deposits with any single bank should not exceed 5% of the depositing bank’s total deposit liabilities as on March 31 of the previous year.

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