RBI imposes monetary penalty on The Aurangabad District Central Co-operative Bank Limited, Bihar

The Reserve Bank of India (RBI) has imposed a monetary penalty of ₹ 1.25 lakh on The Aurangabad District Central Co-operative Bank Limited, Bihar, for contravention of the provisions of section 26A read with section 56 of the Banking Regulation Act, 1949 (BR Act) and non-compliance with directions issued by RBI on ‘Membership of Credit Information Companies (CICs) by Co-operative Banks’.

The bank was found to have failed to transfer eligible amounts to the Depositor Education and Awareness Fund within the prescribed period, and to submit credit information of its borrowers to any of the four Credit Information Companies. This action 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.

The RBI has imposed this penalty in exercise of powers vested in it under section 47A(1) (c) read with sections 46(4)(i) and 56 of BR Act and section 25 of the Credit Information Companies (Regulation) Act, 2005. The statutory inspection of the bank was conducted by the National Bank for Agriculture and Rural Development (NABARD).

The RBI's decision to impose a penalty on the bank is without prejudice to any other action that may be initiated against the bank.