Case Brief
What Happened
The Reserve Bank of India imposed a monetary penalty of ₹5.00 lakh on The Waghodia Urban Co-operative Bank Ltd., Dist. Vadodara, Gujarat, by order dated August 22, 2023. RBI said the bank had failed to comply with directions relating to loans and advances to directors and connected parties, placement of deposits with other banks by primary urban co-operative banks, and interest-rate directions for co-operative banks. The cited breaches included sanctioning credit facilities where relatives of directors were guarantors, breaching prudential inter-bank counter-party exposure limits, and not paying interest correctly on matured recurring deposits and on term deposits maturing on holidays/non-business days and repaid later. RBI imposed the penalty under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.