RBI imposes monetary penalty on The Sutex Co-operative Bank Ltd., Surat (Gujarat)

Case Brief

RBI imposed a monetary penalty of ₹10.00 lakh on The Sutex Co-operative Bank Ltd., Surat (Gujarat), under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949. The penalty was based on findings from a statutory inspection that the bank had sanctioned a loan to a relative of one of its directors and had breached prudential inter-bank (gross) exposure norms, thereby contravening RBI directions on loans and advances to directors/related parties and placement of deposits with other banks by primary urban co-operative banks.