Reserve Bank of India has imposed a monetary penalty of Rupees Two Lakh on Sardarganj Mercantile Co-op. Bank Ltd. Sardarganj, Dist. Anand (Gujarat).
The UCB was faulted for violation pertaining to
1 allowing premature withdrawal of Fixed Deposits despite operational instructions imposed by RBI u/s 36 (1) of the B R Act, 1949 (AACS) and
2 (ii) not reckoning accumulated loss for computation of capital fund to arrive at exposure limits as also not obtaining the approval of RBI for computation of its prudential exposure limit.
The Reserve Bank of India had issued a Show Cause Notice to the bank in response to which the bank submitted a written reply.
After considering the facts of the case, the bank’s reply and the personal submissions made in the matter, the Reserve Bank of India came to the conclusion that the violations were substantiated and warranted imposition of the penalty.