Recorded RBI impact
Fine: Rs 5.00 L
Monetary penalty · Fresh imposition
Published by RBI
15 Jun 2026
Case Brief
RBI, by order dated June 11, 2026, imposed a monetary penalty of ₹5 lakh on Mahila Co-operative Bank Ltd., Bangalore, Karnataka. The penalty followed a statutory inspection with reference to the bank’s financial position as on March 31, 2025, and supervisory findings of non-compliance with RBI directions on loans and advances to directors, their relatives, and firms/concerns in which they are interested. After issuing a show-cause notice and considering the bank’s reply and oral submissions, RBI sustained the charge that the bank had sanctioned director-related loans. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
Why RBI Acted
RBI imposed a monetary penalty after supervisory inspection found non-compliance with RBI directions on loans and advances to directors, their relatives, and firms/concerns in which they are interested. The sustained charge was that the bank had sanctioned director-related loans. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
Operating Impact
The bank must absorb the monetary penalty and address the compliance deficiencies that led to the action. The order does not itself invalidate customer transactions, but it signals heightened supervisory scrutiny and the possibility of further RBI action if similar breaches recur.
Regulatory Basis
- Section 47A(1)(c)
- Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949
Action Facts
- Primary Impact
- Fine: Rs 5.00 L
- Order Date
- 11 Jun 2026
- Effective From
- 11 Jun 2026
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank