RBI imposes monetary penalty on The National Co-operative Bank Limited, Bengaluru, Karnataka

Case Brief

The Reserve Bank of India imposed a monetary penalty of Rs 2.00 lakh on The National Co-operative Bank Limited, Bengaluru, Karnataka. The penalty was levied because the bank failed to adhere to RBI directions issued under the Supervisory Action Framework for Urban Co-operative Banks, with the inspection report showing that it had sanctioned loans in contravention of instructions restricting exposure in sensitive sectors. RBI issued a show-cause notice, considered the bank’s reply and oral submissions, and concluded that the non-compliance was substantiated, warranting the penalty under the Banking Regulation Act, 1949 (AACS).