RBI Cracks the Whip: Heavy Penalties on 4 Cooperative Banks for Rule Violations!”
In a recent move, the Reserve Bank of India (RBI) has imposed significant monetary penalties on four cooperative banks for violations of regulations. The central bank announced this on Monday, November 6, taking action against these banks by Section 47A (1) (c) read with Section 46 (4)(i) and 56 of the Banking Regulation Act 1949.
Penalties on the Banks:
Reason for Penalties:
These banks were penalized for violating regulations related to loans. For instance, Shri Lodra Nagrik Sahakari Bank Limited granted a loan to a guarantor who turned out to be a relative of the bank’s director. Additionally, this bank breached prudential inter-bank aggregate exposure limits and inter-bank counterparty exposure limits.
Malpur Nagrik Sahakari Bank Limited also violated prudential inter-bank aggregate exposure limits and prudential inter-bank counterparty exposure limits.
Limbassi Urban Co-operative Bank Limited had a similar issue with a loan guarantor who was a relative of the directors.
Jolarpet Co-operative Bank Limited faced comparable allegations of rule violations.
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