RBI imposes monetary penalty on Bassein Catholic Co-operative Bank Ltd., Vasai, Maharashtra

Case Brief

By an order dated September 22, 2023, RBI imposed a monetary penalty of ₹25 lakh on Bassein Catholic Co-operative Bank Ltd., Vasai, Maharashtra. The action followed a statutory inspection and subsequent examination of reports and correspondence, which revealed that the bank had granted multiple unsecured loans to one of its directors and his proprietorship firm. RBI concluded that this violated Section 20 read with Section 56 of the Banking Regulation Act, 1949, as well as RBI's directions on 'Exposure Norms and Statutory / Other Restrictions'. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the BR Act, after the bank's reply, additional submissions, and oral submissions were considered.