RBI imposes Rs 55 lakh penalty on Pune-based Seva Vikas Cooperative Bank

Topics RBI | Non-compliance | Banks

The RBI on Wednesday said it has imposed a Rs 55 lakh penalty on Pune-based Seva Vikas Cooperative Bank Limited for non-compliance with certain directions, including for not ensuring end-use of funds lent.

The penalty, it said, has been imposed for non-compliance with certain directions in the 'Master Circular - Management of Advances -UCBs' and 'Master Circular - Income Recognition, Asset Classification, Provisioning and Other Related Matters - UCBs'.

"The penalty has been imposed on the bank...(i) for not ensuring end-use of funds lent (ii) non-adherence to IRAC norms and (iii) restructuring of loan accounts with retrospective effect on grounds not valid, revealed during a scrutiny of the bank conducted by RBI during 2019," it said.

A notice was issued to Seva Vikas Cooperative Bank advising it to show cause as to why penalty should not be imposed on it for such non-compliance with the directions.

"After considering the bank's reply to the notice, RBI concluded that the charge of non-compliance with aforesaid RBI directions was substantiated and warranted imposition of monetary penalty," the central bank said.

It, however, added the penalty is based on the 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.


(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)


Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel