RBI imposes monetary penalty on The Arantangi Co-operative Town Bank Limited, Tamil Nadu
Case Brief
By order dated October 22, 2025, RBI imposed a monetary penalty of Rs 50,000 on The Arantangi Co-operative Town Bank Limited, Tamil Nadu. The bank was found to have paid dividend from accumulated profits of previous years, in breach of RBI directions on 'Declaration of dividend by UCBs'. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949, after a show-cause notice, reply, and oral hearing.
RBI imposed a monetary penalty after supervisory inspection found that The Arantangi Co-operative Town Bank Limited had not complied with certain RBI directions on 'Declaration of dividend by UCBs'. The specific sustained charge was that the bank paid dividend from accumulated profits of previous years. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
Severity Assessment
This is a monetary penalty of Rs 50,000, which falls in the lowest monetary band and carries no structural restriction.
The bank must absorb the penalty and may still face any other action RBI decides to initiate separately. The order does not itself impose an operational restriction on depositors or customers, but it records a compliance breach and regulatory censure.
Published as The Arantangi Co-operative Town Bank Limited
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