Case Brief
By an order dated December 16, 2022, RBI imposed a monetary penalty of Rs 2.25 lakh on The Bodeli Urban Co-operative Bank Ltd., Bodeli, Dist. Chhota Udepur (Gujarat). The penalty was imposed for contravention of RBI directions on loans and advances to directors, including directions relating to directors' relatives standing as surety/guarantor, and on maintenance of statutory reserves, namely the Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR). RBI said its statutory inspection for the period ended March 31, 2021, revealed that the bank sanctioned two loans where relatives of directors acted as sureties/guarantors and failed to maintain the minimum CRR. After a show-cause notice, consideration of the bank's reply and oral submissions, RBI concluded that the charges were substantiated and warranted penalty under the Banking Regulation Act, 1949.
Action Snapshot
- Primary Impact
- Fine: Rs 2.25 L
- Entity Type
- Co-operative bank
- Location