Case Brief
What Happened
The Reserve Bank of India imposed a monetary penalty on Kerala Mercantile Co-operative Bank Ltd., Kozhikode, Kerala, by order dated March 25, 2025. RBI said the bank failed to comply with specific directions issued under the Supervisory Action Framework (SAF), as revealed by scrutiny of the bank’s Statutory Auditor’s Report for FY 2023-24. The sustained violation was that the bank incurred capital expenditure well in excess of the permitted limit without prior RBI approval. The penalty was levied under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.