Case Brief
What Happened
By an order dated December 26, 2023, RBI imposed a monetary penalty of ₹10.00 lakh on The Patdi Nagarik Sahakari Bank Limited, Patdi, Dist. Surendranagar, Gujarat. The penalty was imposed under section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949 for non-compliance with RBI directions relating to donations to trusts and institutions where directors or their relatives were interested, loans and advances to directors/relatives and concerns where relatives acted as guarantors, placement of deposits with other banks by UCBs, and RBI's directions on interest rates on deposits for co-operative banks. RBI said inspection and related correspondence showed the bank had made prohibited donations, sanctioned related-party loans, breached prudential inter-bank exposure limits, and accepted interest-free deposits other than current account deposits.