RBI imposes monetary penalty on The Bavla Nagarik Sahakari Bank Ltd., Dist. Ahmedabad, Gujarat

Case Brief

The Reserve Bank of India imposed a monetary penalty of ₹3.00 lakh on The Bavla Nagarik Sahakari Bank Ltd., Dist. Ahmedabad, Gujarat, by order dated May 22, 2024. RBI said the penalty was for non-compliance with directions relating to loans and advances to directors, relatives and connected firms/concerns, as well as the KYC Master Direction. The bank had sanctioned or renewed loans where directors' relatives were interested or served as guarantors, and it had not carried out risk-based periodic updation of KYC as required. The penalty was imposed under section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949, following supervisory findings and a show-cause process.