Case Brief
By an order dated November 03, 2023, RBI imposed a monetary penalty of Rs 1.50 lakh on The Mandal Nagarik Sahakari Bank Ltd., Mandal, Dist. Ahmedabad, Gujarat. The penalty was imposed for non-compliance with RBI directions on loans and advances to directors/relatives and firms/concerns in which they are interested, the related clarification on directors acting as sureties/guarantors, and on co-operative banks' interest rate on deposits. RBI found that the bank sanctioned loans where a relative of one of its directors stood as guarantor and failed to pay interest at the applicable rate on certain term deposits, including deposits maturing on holidays/non-business days, prematurely withdrawn deposits, and matured overdue term deposits. RBI stated the action was based on deficiencies in regulatory compliance and not intended to pronounce upon the validity of any transaction or agreement.
Action Snapshot
- Primary Impact
- Fine: Rs 1.50 L
- Entity Type
- Co-operative bank
- Location