Case Brief
What Happened
The Reserve Bank of India imposed a monetary penalty on The Kuppam Co-operative Town Bank Ltd., Kuppam, Andhra Pradesh 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 levied after RBI found that the bank had violated its directives and guidelines on loans and advances to directors and their relatives. RBI noted that it had issued a show-cause notice, considered the bank's written reply and personal hearing, and then concluded that the violations were substantiated.