Mumbai (Maharashtra) [India], January 24 (ANI): The Reserve Bank of India (RBI) has imposed a monetary penalty of Rs 26 lakh on Nutan Nagarik Sahakari Bank, Ahmedabad for non-compliance with certain directions of the central bank.

This penalty has been imposed in exercise of the powers vested in RBI conferred under the Banking Regulation Act, 1949, the central bank said.

This action of the central bank is based on a deficiency 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.

The statutory inspection of the bank conducted by RBI with reference to its financial position as on March 31, 2020, and examination of the risk assessment report and all related correspondence pertaining to the same revealed that the bank failed to pay interest at the rate applicable to saving deposits on certain overdue recurring and fixed deposit accounts at the time of their repayment and had issued ATM-cum-debit cards to certain cash credit account holders, according to a statement released on Monday evening.

In furtherance to the same, a notice was issued to the bank advising it to show cause as to why the penalty should not be imposed for non-compliance with the RBI directions.

After considering the bank's reply to the notice, additional submissions made by the bank and the oral submissions made during the personal hearing, the central bank said it came to the conclusion that the charge of non-compliance with the aforesaid RBI directions were substantiated and warranted imposition of monetary penalty, to the extent of non-compliance with such directions. (ANI)