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The Reserve Bank of India (RBI) on Tuesday imposed a penalty of Rs 2 lakh on Dhrangadhra People's Co-operative Bank, Surendranagar, Gujarat, for non-compliance with certain norms.

The RBI said the penalty has been imposed for non-compliance with RBI directions on 'Placement of Deposits with Other Banks by Primary (Urban) Co-operative Banks (UCBs)' and 'Depositor Education and Awareness Fund Scheme 2014'.

Giving details, the RBI said the statutory inspection of the bank conducted by it with reference to the bank's financial position as on March 31, 2018, and the inspection report thereto, revealed, inter alia, non-compliance with the directions.

Subsequently, a notice was issued to the Dhrangadhra People's Co-operative Bank.

"After considering the bank's reply to the notice and oral submissions made during the personal hearing, the RBI came to the conclusion that the aforesaid charges were substantiated and warranted imposition of monetary penalty," the RBI said.

The central bank added that the penalty is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers.

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Free Press Journal