Reserve Bank of India imposes monetary penalty on The Thiruvaikuntam Co-Operative Urban Bank Limited, Thoothukudi District, Tamil Nadu

Case Brief

The Reserve Bank of India imposed a monetary penalty on The Thiruvaikuntam Co-operative Urban Bank Limited for contravening RBI directions prohibiting loans and advances to directors. The inspection report for the bank's position as on March 31, 2019 found that it had sanctioned such loans to its directors, leading RBI to issue a show-cause notice. After examining the bank's response and hearing its oral submissions, RBI concluded that the non-compliance was established and warranted the penalty, imposed under Section 47A(1)(c) read with Section 46(4)(i) and Section 56 of the Banking Regulation Act, 1949.