The Reserve Bank of India (RBI) has imposed a ₹1 lakh penalty on Shri Baria Nagarik Sahakari Bank Ltd., Baria, for failing to comply with RBI’s directions on inspection and audit systems for primary (urban) co-operative banks.
The penalty has been imposed under the provisions of the Banking Regulation Act, 1949, the RBI said.
No Internal Audit Conducted for Two Years
The action follows an RBI statutory inspection of the bank based on its financial position as of March 31, 2025.
During the inspection, RBI found that the bank had failed to conduct an internal audit between April 1, 2023, and March 31, 2025, violating regulatory requirements.
After issuing a show-cause notice, reviewing the bank’s response and hearing its representatives, RBI concluded that the violation had been established and imposed the monetary penalty.
Penalty for Regulatory Non-Compliance
The RBI clarified that the penalty is solely for regulatory non-compliance and does not affect the validity of any transactions or agreements between the bank and its customers.
The central bank also stated that the penalty does not prevent it from taking any further action against the bank if required.