Case Brief
The Reserve Bank of India imposed a monetary penalty of Rs 50,000 on Bhabhar Vibhag Nagarik Sahakari Bank Limited, Bhabhar, District Banaskantha, Gujarat, by order dated November 30, 2023. The penalty was levied for non-compliance with RBI directions relating to loans and advances to directors, their relatives, and firms/concerns in which they are interested, read with the clarification on directors acting as surety/guarantors. RBI’s inspection found that the bank had sanctioned a loan where a relative of one of the bank’s directors stood as guarantor. After considering the bank’s reply and oral submissions, RBI held the charge substantiated and imposed the penalty under section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
Action Snapshot
- Primary Impact
- Fine: Rs 50,000
- Entity Type
- Co-operative bank
- Location