RBI imposes monetary penalty on Sardargunj Mercantile Co-operative Bank Limited, Patan, Gujarat

Case Brief

By an order dated November 30, 2023, RBI imposed a monetary penalty of ₹2.00 lakh on Sardargunj Mercantile Co-operative Bank Limited, Patan, Gujarat for non-compliance with RBI's directions on placement of deposits with other banks by Primary (Urban) Co-operative Banks. The statutory inspection found that the bank had breached the prudential inter-bank counterparty exposure limit. After issuing a show-cause notice and considering the bank's reply, additional submissions, and oral hearing, RBI concluded that the contravention was substantiated and merited penalty under the Banking Regulation Act, 1949.