RBI imposes penalty on The Prathamik Shikshak Sahakari Bank Limited Kolhapur

Case Brief

The Reserve Bank of India imposed a monetary penalty on The Prathamik Shikshak Sahakari Bank Ltd., Kolhapur (Salary Earners’ Bank) under Section 47A(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (as applicable to co-operative societies). The violation related to operational instructions on declaration and payment of dividend for FY 2013-14 without prior permission from RBI. After a show-cause notice and the bank’s written reply, RBI held that the violations were substantial and merited the penalty.