RBI imposes Rs 8 lakh fine on Power Finance Corporation

The Reserve Bank of India (RBI) on Tuesday imposed a Rs 8 lakh fine on the state-run Power Finance Corporation Limited (PFC) for non-compliance with certain provisions. The central bank said that an inspection was conducted about its financial position as of March 31, 2022. The examination of the risk assessment report revealed that the company had not maintained the Liquidity Coverage Ratio (LCR) of 60 per cent as of March 31, 2022, as a result of the inclusion of ineligible assets as High-Quality Liquid Assets (HQLA) for the computation of the LCR. 

Consequently, a notice was issued to the company advising it to show cause as to why a penalty should not be imposed on it for failure to comply with the RBI directions. "After considering the company's reply to the notice, examination of additional submissions made by it and oral submissions made during the personal hearing, RBI came to the conclusion that the charge of non-compliance with the aforesaid RBI directions was substantiated and warranted imposition of monetary penalty."

RBI cancels licence of Maharashtra-based Jai Prakash Narayan Nagari Sahakari Bank Ltd

The RBI has cancelled the licence of Maharashtra-based 'Jai Prakash Narayan Nagari Sahakari Bank Ltd. "Consequently, the bank ceases to carry on banking business, with effect from the close of business on February 6, 2024," the central bank said, adding that the Commissioner for Co-operation and Registrar of Cooperative Societies, Maharashtra has also been requested to issue an order for winding up the bank and appoint a liquidator for the bank.

The bank regulator said that the bank does not have adequate capital and earning prospects. "The continuance of the bank is prejudicial to the interests of its depositors." The RBI said that the bank with its present financial position would be unable to pay its present depositors in full. "Public interest would be adversely affected if the bank is allowed to carry on its banking business any further," it added.