The Reserve Bank of India imposed, by an order dated December 23, 2021, a fine of Rs 30 Lakh on the MUFG Bank for failure to comply with the instructions issued by the RBI on “Loans and Advances – Statutory and other restrictions”.

Two other UCBs that were penalized by the RBI last week are Dattatraya Maharaj Kalambe Jaoli Sahakari Bank, based in Mumbai, and Chiplun Urban Co-operative Bank, based in Ratanagiri.

On MUFG Bank, RBI said, “This action is based on gaps in regulatory compliance and is not intended to rule on the validity of any transaction or agreement entered into by the bank with its customers. “

The statutory inspection for the prudential assessment of the bank was conducted by RBI and the review of the risk assessment report, inspection report and all related correspondence thereon revealed, among other things, failure to comply with the aforementioned instruction insofar as the bank had sanctioned loans and advances to companies whose board of directors included persons administering the boards of directors of other banks, without such penalties not being are granted at the level of its management committee.

In the same vein, a notice was issued to the bank asking it to justify the reasons why a penalty should not be imposed on it for failing to comply with the RBI instruction, as indicated therein.

After reviewing the bank’s response to the notice, the oral submissions made at the personal hearing, and the additional submissions made by the bank, RBI came to the conclusion that the charge of failure to comply with the instruction RBI mentioned above was justified and justified the imposition of a financial penalty.

Dattatraya Maharaj Kalambe Jaoli Sahakari Bank was fined Rs 1 lakh for violating instructions issued by RBI on Exposure Standards and Statutory / Other Restrictions – UCB.

Reserve Bank of India fined Rs 2 lakh on third UCB namely Chiplun Urban Co-operative Bank Ltd., Ratnagiri for violating instructions issued by RBI on exposure standards and statutory / other restrictions – UCB .


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