Case Brief
What Happened
The Reserve Bank of India imposed a monetary penalty of Rs 1,00,000 on Sri Basaveshwar Co-operative Bank Ltd., Basavan Bagewadi, Bijapur, Karnataka under Section 47A read with Section 46(4) of the Banking Regulation Act, 1949 (as applicable to co-operative societies). RBI found that the bank had violated directives/guidelines by sanctioning loans to the director or relative of a director. After issuing a show-cause notice and considering the bank’s representation in a personal hearing, RBI concluded that the contraventions were substantiated and merited penalty.