**Executive Summary**
RBI imposed a monetary penalty of ₹2.25 lakh on The Yavatmal Urban Co-operative Bank Ltd. on December 4, 2025, due to non-compliance with RBI directions on Risk Management, Treatment of Defaulters, and Credit Information Reporting. The penalty was imposed following a statutory inspection with reference to the bank's financial position as of March 31, 2025. This action does not affect the validity of the bank's transactions with its customers.
**Key Points / Main Content**
* **Monetary Penalty:**
* RBI imposed a monetary penalty of ₹2.25 lakh on The Yavatmal Urban Co-operative Bank Ltd.
* **Reason for Penalty:**
* Non-compliance with RBI directions on:
* Concentration Risk Management
* Treatment of Wilful Defaulters and Large Defaulters
* Credit Information Reporting
* **Legal Basis:**
* The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949, and Section 25(1)(iii) read with Section 23(4) of the Credit Information Companies (Regulation) Act, 2005.
* **Inspection Findings:**
* The statutory inspection was conducted with reference to the bank's financial position as of March 31, 2025.
* RBI found the following charges were sustained after considering the bank's reply:
* Sanctioned loans in excess of the prescribed regulatory limit to certain nominal members.
* Failed to report information on certain borrowers classified as wilful defaulters to Credit Information Companies within the prescribed regulatory timeline.
* **Disclaimer:**
* The action is based on deficiencies in regulatory compliance.
* It is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers.
* The penalty is without prejudice to any other action that may be initiated by RBI against the bank.
**Impact Analysis**
**The Yavatmal Urban Co-operative Bank Ltd.**
* **Impact:**
* The bank is subject to a monetary penalty of ₹2.25 lakh.
* The bank's reputation may be affected.
* **Action Required:**
* Pay the monetary penalty.
* Address the deficiencies in regulatory compliance.
* Implement corrective measures to prevent future non-compliance.
**RBI**
* **Impact:**
* Reinforces regulatory compliance in the banking sector.
* **Action Required:**
* Monitor the bank's compliance with corrective measures.
* Initiate further action if necessary.
Key Entities Referenced
Reserve Bank of India (RBI): Imposed monetary penalty for non-compliance with directions.
The Yavatmal Urban Co-operative Bank Ltd., Yavatmal, Maharashtra: Entity on which monetary penalty was imposed.
Banking Regulation Act, 1949: Act under which RBI imposed penalty. Sections 46(4)(i) and 56 are referenced.
Credit Information Companies (Regulation) Act, 2005: Act related to reporting of defaulters, Section 23(4) is referenced.
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December 08, 2025
RBI imposes monetary penalty on The Yavatmal Urban Co-operative Bank Ltd.,
Yavatmal, Maharashtra
The Reserve Bank of India (RBl) has, by an order dated December 4, 2025,
imposed a monetary penalty of ₹2.25 lakh (Rupees Two Lakh Twenty Five Thousand
only) on The Yavatmal Urban Co-operative Bank Ltd., Yavatmal, Maharashtra (the
bank), for non-compliance with certain directions issued by RBI on ‘Concentration
Risk Management’, ‘Treatment of Wilful Defaulters and Large Defaulters’ and ‘Credit
Information Reporting’. This penalty has been imposed in exercise of powers
conferred on RBI under the provisions of Section 47A(1)(c) read with Sections
46(4)(i) and 56 of the Banking Regulation Act, 1949, and Section 25(1)(iii) read with
Section 23(4) of the Credit Information Companies (Regulation) Act, 2005.
The statutory inspection of the bank was conducted by the RBI with reference to
its financial position as on March 31, 2025. Based on supervisory findings of non-
compliance with RBI directions and related correspondence in that regard, a notice
was issued to the bank advising it to show cause as to why penalty should not be
imposed on it for its failure to comply with the said directions. After considering the
bank's reply to the notice, additional submissions made by it and oral submissions
made during the personal hearing, RBI found, inter alia, that the following charges
against the bank were sustained, warranting imposition of monetary penalty:
The bank had:
i. sanctioned loans in excess of the prescribed regulatory limit to certain nominal
members; and
ii. failed to report information on certain borrowers classified as wilful defaulters
to Credit Information Companies within the prescribed regulatory timeline.
This action is based on deficiencies 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. Further, imposition of this monetary penalty is without
prejudice to any other action that may be initiated by RBI against the bank.
(Brij Raj)
Press Release: 2025-2026/1660 Chief General Manager