RBI imposes monetary penalty on Mizoram Urban Cooperative Development Bank Limited, Aizawl

Case Brief

The Reserve Bank of India imposed a monetary penalty on Mizoram Urban Cooperative Development Bank Limited, Aizawl by order dated August 02, 2023. RBI said the penalty was for non-compliance with specific directions issued under the Supervisory Action Framework and certain provisions of the RBI (Know Your Customer) Directions, 2016. The inspection found that the bank had granted fresh loans and advances carrying risk weights of more than 100% in violation of SAF directions and had not put in place a system for periodic review of risk categorisation of accounts. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.