RBI Slaps Monetary Penalty on Surat People's Co-operative Bank for Director Non-Compliance Issues
Regulatory Action: RBI Imposes Penalty on Surat People's Co-operative Bank
The Reserve Bank of India (RBI) has levied a monetary penalty against Surat People's Co-operative Bank Ltd., Surat. The penalty amounts to ₹13.30 lakh (Rupees Thirteen lakh and thirty thousand only). This action was taken under an order dated July 10, 2026.The imposition is for non-compliance with specific directions issued by the RBI regarding 'Board of Directors - UCB'. The penalty was exercised utilizing powers conferred upon the RBI under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
Findings Detail Non-Compliance at Bank Level
The regulatory action followed a statutory inspection conducted by the RBI. The bank's financial position was examined as on March 31, 2025. Based on supervisory findings, a notice was initially issued to the bank, directing it to explain why a penalty should not be imposed.After reviewing the bank’s response and oral submissions during a personal hearing, RBI sustained a charge against the institution. The primary infraction involved certain directors of the bank. These directors were found to have participated in Board meetings where proposals involving their direct or indirect interest were discussed and approved.
Scope and Caveats of Monetary Penalty
The decision regarding this penalty is based solely on deficiencies identified during regulatory compliance checks. It is crucial to note that this action is not intended to question the validity of any transaction or agreement executed by the bank with its customers.Furthermore, RBI has clarified that the imposition of this monetary penalty does not prejudge any other actions that may be initiated against the bank in future. The RBI maintains its supervisory authority over the institution regarding regulatory compliance matters.
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