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Rajkot Commercial Co-operative Bank Limited, Rajkot, Gujarat

Co-operative bankRajkot, Gujarat

The RBI action, regulatory basis, and operating impact linked to this entity.

Recorded RBI impact

Fine: Rs 2.00 L

Monetary penalty · Fresh imposition

S1

Published by RBI

18 Aug 2011

Case Brief

The Reserve Bank of India imposed a monetary penalty of Rs 2.00 lakh on Rajkot Commercial Co-operative Bank Limited, Rajkot, Gujarat under Section 47A(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (AACS). The action followed findings that the bank violated RBI instructions on granting unsecured advances in excess of the prescribed ceiling and on director-related advances. RBI issued a show-cause notice, considered the bank's written reply and personal submissions, and concluded that the violations were substantiated, warranting the penalty.

Why RBI Acted

Lending normsGovernance oversight

RBI imposed a monetary penalty under Section 47A(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (AACS), after concluding that the bank had violated its instructions regarding grant of unsecured advances in excess of the prescribed ceiling and advances to directors/related parties. The bank had received a show-cause notice and submitted a written reply, but the violations were found substantiated after considering the facts and personal submissions.

Operating Impact

The bank must absorb the monetary penalty; the release does not mention any additional operational restriction or remedial direction. The action serves as a compliance finding against the bank for past lending and related-party advance practices.

Regulatory Basis

  • Section 47(A)(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (AACS)

Action Facts

Primary Impact
Fine: Rs 2.00 L
Entities Affected
1
Entity Role
Primary
Entity Type
Co-operative bank