Pune, Maharashtra – The Reserve Bank of India (RBI) has taken significant action against The Baramati Sahakari Bank Ltd., located in Baramati, Pune, Maharashtra. By an order dated August 22, 2023, RBI has imposed a monetary penalty of ₹2.00 lakh (Rupees Two Lakh only) on the bank. This penalty has been levied due to the bank’s failure to comply with RBI’s directives regarding the ‘Maintenance of Deposit Accounts – Primary (Urban) Co-operative Banks.’ The penalty has been enforced in accordance with the powers vested in RBI under Section 47 A (1) (c), along with Sections 46 (4) (i) and 56 of the Banking Regulation Act, 1949.
It’s essential to note that this action primarily addresses regulatory compliance issues and does not cast any judgment on the validity of transactions or agreements between the bank and its customers.
Background
The regulatory scrutiny of the bank was initiated by RBI based on its financial status as of March 31, 2022. This assessment, combined with an examination of the Risk Assessment Report and related correspondence, revealed several deficiencies. One significant finding was the bank’s failure to credit interest to inoperative savings bank accounts. Subsequently, the bank was issued a notice, urging it to provide reasons why a penalty should not be imposed for non-compliance with the stipulated RBI directives.
Following a thorough review of the bank’s response to the notice, along with additional and oral submissions during a personal hearing, RBI concluded that the charges of non-compliance with the aforementioned RBI directives were substantiated. Therefore, the imposition of a monetary penalty was deemed appropriate.
