Case Brief
What Happened
The Reserve Bank of India imposed a monetary penalty of ₹4.50 lakh on Gujarat Mercantile Co-operative Bank Ltd., Ahmedabad, Gujarat, by order dated September 18, 2023. RBI said the bank failed to comply with directions on placement of deposits with other banks by primary urban co-operative banks and maintenance of Cash Reserve Ratio (CRR). The statutory inspection found breaches of inter-bank gross exposure and counterparty exposure limits and also that the bank did not maintain minimum CRR for certain days. After notice, the bank’s reply and oral submissions were considered, and RBI concluded that the contraventions were substantiated and warranted the penalty under the Banking Regulation Act, 1949.