RBI imposes monetary penalty on Devika Urban Co-operative Bank Ltd., Udhampur, J & K

Case Brief

By an order dated August 14, 2023, RBI imposed a penalty on Devika Urban Co-operative Bank Ltd., Udhampur, J & K for violating RBI directions on sanction of loans and advances to directors, relatives, and firms/concerns in which they are interested. The supervisory findings noted renewal of a cash credit facility to a sole proprietorship concern linked to the family of a director, and RBI held that the charge was substantiated after considering the bank's reply. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.