Reserve Bank of India imposes monetary penalty on The Mandvi Mercantile Co-operative Bank Ltd., Mandvi, Dist. Kutch (Gujarat)

Case Brief

RBI, by an order dated January 13, 2021, imposed a monetary penalty of ₹1 lakh on The Mandvi Mercantile Co-operative Bank Ltd., Mandvi, Dist. Kutch (Gujarat). The penalty was for contravention of RBI directions on loans and advances to directors, relatives and firms/concerns in which they are interested, and on placement of deposits with other banks by primary (urban) co-operative banks. RBI said the breach was revealed during inspection based on the bank’s financial position as on March 31, 2018, and that the bank’s reply and oral submissions were considered before concluding that the non-compliance was substantiated and warranted penalty.