RBI imposes monetary penalty on Indian Mercantile Co-operative Bank Ltd., Lucknow

Case Brief

By order dated November 24, 2022, RBI imposed a monetary penalty of ₹20 lakh on Indian Mercantile Co-operative Bank Ltd., Lucknow, Uttar Pradesh. The penalty was for non-compliance with RBI directions on Income Recognition, Asset Classification, Provisioning and Other Related Matters (IRAC norms), specifically the failure to classify certain loan accounts as non-performing assets in accordance with the norms. RBI said the penalty was imposed under section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949, after considering the bank’s reply, additional submissions, and oral submissions at the personal hearing.