Case Brief
What Happened
The Reserve Bank of India imposed a monetary penalty of Rs 5.00 lakh on Janata Urban Co-operative Bank Ltd, Wai, Satara under Section 47A(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (as applicable to co-operative societies). The penalty was for violation of RBI directives/guidelines relating to unsecured advances, loans and advances to firms in which directors and their relatives were interested, exposure to housing, real estate and commercial real estate, and single and group exposure. RBI also noted that the bank had created floating charges on standard assets without prior approval and was not carrying out risk categorisation of customers. After a show-cause notice and the bank's written reply, RBI held that the violations were substantiated and imposed the penalty.