Reserve Bank of India imposes monetary penalty on The Kalpavruksha Co-operative Bank Limited, Chikkanayakanahalli, Tumakuru Dist. (Karnataka)

Case Brief

By an order dated February 2, 2021, RBI imposed a monetary penalty of ₹1.00 lakh on The Kalpavruksha Co-operative Bank Limited, Chikkanayakanahalli, Tumakuru District, Karnataka. The bank was found गैर-compliant with directions in RBI's Master Circular on Board of Directors-UCBs, specifically the prohibition on granting loans and advances to directors, their relatives, and entities in which they were interested. The order was issued after a show-cause notice, consideration of the bank's reply, and oral submissions made at the personal hearing. RBI clarified that the action is based on regulatory deficiencies and does not pronounce on the validity of individual transactions.