Case Brief
What Happened
The Reserve Bank of India imposed a monetary penalty of Rs 5 lakh on The Citizen Co-operative Bank Limited, Bangalore under Section 47A(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (AACS). The penalty was for violating RBI instructions by sanctioning or renewing loans to relatives of the bank's director and suppressing the information by not reporting it in the relevant quarterly statement proforma I & II submitted to RBI. RBI issued a show-cause notice, received the bank's written reply and personal submissions, and concluded that the violations were substantiated and justified the penalty.