The Reserve Bank of India (RBI) has imposed a monetary penalty of Rs 2 lakh on The Satara Sahakari Bank Ltd., Mumbai, for non-compliance with prudential norms and exposure limits prescribed for Urban Co-operative Banks (UCBs).

The action follows an inspection based on the bank’s financials as of March 31, 2024, which revealed that the bank had refunded share capital despite failing to meet the minimum Capital to Risk-weighted Assets Ratio (CRAR) requirement and had breached the single borrower exposure limit.

RBI clarified that the penalty is based on regulatory deficiencies and does not affect the validity of customer transactions. Further action, if necessary, remains open.