Document title: RBI imposes monetary penalty on The Nasik Road Deolali Vyapari Sahakari Bank Ltd., Nashik
Issuing Authority: Reserve Bank of India
Reference: Press Release 2026-2027/488
Date: 18 June 2026
Regulatory and Policy Measures
The Reserve Bank of India, by an order dated 12 June 2026, imposed a monetary penalty of ₹2,10,000 (Rupees Two Lakh Ten Thousand only) on The Nasik Road Deolali Vyapari Sahakari Bank Ltd. The penalty is exercised under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949. The RBI conducted a statutory inspection of the bank with reference to its financial position as on 31 March 2025. Following supervisory findings of non‑compliance with RBI directions, a show‑cause notice was issued, the bank submitted a reply and made oral submissions during a personal hearing. After consideration, RBI sustained the charge of sanctioning loans to directors' relatives and imposed the penalty, stating that the action does not prejudice any further action that may be taken.
Banking and Credit
The specific breach identified was that the bank had sanctioned loans to the relatives of its directors, contravening RBI directions on “Loans and Advances to Directors, their Relatives, and Firms/Concerns in which they are Interested”. The RBI emphasized that the penalty addresses deficiencies in regulatory compliance and is not a judgment on the validity of the underlying transactions.
The RBI’s enforcement underscores its continued focus on adherence to prudential norms governing credit exposure to related parties, aiming to safeguard banking stability and protect depositor interests.
In conclusion, the penalty of ₹2.1 lakh reflects RBI’s commitment to strict compliance with loan‑related directives and serves as a warning to cooperative banks regarding related‑party credit practices.