RBI levies monetary policies on eight banks

Reserve Bank of India

The Reserve Bank of India (RBI) has levied monetary penalties on eight Indian banks. Chhattisgarh Rajya Sahakari Bank, The Goa State Co-operative Bank, Garhaa Co-Operative Bank, The Yavatmal Urban Co-operative Bank, Jila Sahakari Kendriya Bank, Warud Urban Co-operative Bank, Indapur Urban Co-operative Bank, and The Mehsana Urban Co-operative Bank were among the eight banks. The penalties imposed on these eight institutions varied from 1 lakh to 40 lakh. Furthermore, the RBI imposed a monetary penalty on Spandana Sphoorty Financial, an NBFC.

The penalty follows a mandated inspection of the bank by NABARD about the bank’s financial situation as of March 31, 2020.

The inspection report and investigation of all connected correspondence revealed, among other things, that the bank had failed to implement a system of periodic evaluation of client risk classification, according to the RBI.

“After considering the company’s reply to the notice, examination of additional submissions made by it and oral submissions made during the personal hearing, RBI came to the conclusion that the charge of non-compliance with the aforesaid RBI directions was substantiated and warranted imposition of monetary penalty,” the central bank said.

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