Document title: RBI imposes monetary penalty on The Citizen Co-operative Bank Limited, Bangalore, Karnataka
Issuing authority: Reserve Bank of India (RBI)
Reference number: Press Release 2026-2027/762
Date: 27 July 2026
Banking and Credit
The Reserve Bank of India, exercising powers under section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949, issued an order dated 17 July 2026 imposing a monetary penalty of ₹50,000 on The Citizen Co-operative Bank Limited. The penalty relates to the bank’s non‑compliance with RBI directions on Income Recognition, Asset Classification, Provisioning and Other Related Matters for Urban Co-operative Banks (UCBs). A statutory inspection of the bank’s financial position as on 31 March 2025 identified that the bank had failed to classify certain loan accounts as non‑performing assets (NPAs).
Regulatory and Policy Measures
Following the inspection, RBI served a show‑cause notice to the bank, seeking an explanation for the breach. After reviewing the bank’s written reply and oral submissions made during a personal hearing, RBI sustained the charge of non‑classification of loan accounts as NPAs and imposed the monetary penalty. The RBI clarified that the penalty is imposed without prejudice to any other action that may be initiated against the bank. The press release, signed by Chief General Manager Brij Raj, was issued on 27 July 2026.
The RBI’s action underscores its commitment to enforce compliance with regulatory directives concerning income recognition and asset classification among urban co‑operative banks.