RBI Imposes Rs1.50 Lakh Penalty on Mettupalayam Cooperative Urban Bank

Reserve Bank of India (RBI) has imposed a penalty of Rs1.50 lakh on the Tamil Nadu-based Mettupalayam Cooperative Urban Bank for non-compliance with RBI directions. The violations pertain to rules governing loans and advances to directors, their relatives and firms or concerns connected to them, as well as exposure norms and other statutory restrictions applicable to urban cooperative banks (UCBs). RBI’s statutory inspection revealed that Mettupalayam Cooperative Urban Bank had sanctioned director-related loans and had also granted loans to nominal members beyond the prescribed regulatory limit. After considering Mettupalayam Cooperative Urban Bank's reply to the notice, oral submissions made during the personal hearing and examination of additional submissions made by it, RBI