The Reserve Bank of India has imposed a monetary penalty of ? 60 million on Tamilnad Mercantile Bank Limited, according to a delayed piece of news item .
The UCB was punished for contravention of Master Directions on Issue and Pricing of Shares dated April 21, 2016 (the Directions) issued by RBI. This penalty has been imposed in exercise of powers vested in RBI, reads a press release.
The regulator said it was authorized to punish the UCB under the provisions of Section 47A (1) (c) read with Section 46 (4) (i) of the Banking Regulation Act, 1949 taking into account the failure of the bank to adhere to the Directions while issuing bonus shares to certain non-resident entities.