India, Nov. 10 -- The Reserve Bank of India (RBI) has imposed a Rs 2 lakh penalty on The Mumbai District Central Co-operative Bank Ltd., Maharashtra, for violating provisions of Section 20 of the Banking Regulation Act, 1949, which restricts loans to directors and related entities.
The penalty follows a statutory inspection conducted by NABARD as of March 31, 2024, which revealed that the bank had sanctioned certain director-related loans, contravening regulatory norms.
After reviewing the bank's response and submissions, the RBI confirmed the violation and imposed the penalty under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Act.
The central bank clarified that the action is based on compliance deficiencies and does not ...