The Reserve Bank of India (RBI) has imposed a monetary penalty of Rs 2 lakh on The Jeypore Co-operative Urban Bank Limited, Odisha, for non-compliance with regulatory directions related to ‘Exposure Norms and Statutory/Other Restrictions’ applicable to urban co-operative banks.

The penalty, imposed through an order dated February 3, 2026, was levied under provisions of the Banking Regulation Act, 1949.

Following a statutory inspection based on the bank’s financial position as of March 31, 2025, RBI observed compliance lapses and issued a show-cause notice. After reviewing the bank’s response and oral submissions, the central bank concluded that the lender had breached prudential inter-bank (gross) exposure limits as well as inter-bank counter-party limits.

RBI clarified that the action pertains only to regulatory shortcomings and does not affect the validity of any customer transactions. The penalty is also without prejudice to any further action that may be initiated.