Case Brief
What Happened
The Reserve Bank of India penalised Kokan Mercantile Co-operative Bank Ltd., Mumbai, Maharashtra, with Rs. 1 lakh under Section 47A(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (as applicable to co-operative societies). RBI found that the bank had violated its directive on limits on credit exposure to a single borrower/group of borrowers. After issuing a show-cause notice, considering the bank’s written reply, and giving an opportunity for personal hearing, RBI concluded that the violation was substantiated and justified the penalty.