RBI imposes monetary penalty on 14 banks for violation of rules

NEW DELHI: The Reserve Bank of India (RBI) has imposed monetary penalty on State Bank of India (SBI) and 13 other banks for violation of rules.

Bank of Baroda has been imposed the highest penalty of Rs 2 crores while SBI has to pay Rs 50 lakhs.

As stated by RBI, the violations include non-compliance with certain provisions of directions issued by RBI on ‘Lending to Non-Banking Financial Companies (NBFCs)’ ‘Bank Finance to Non-Banking Financial Companies (NBFCs)’ and ‘Loans and Advances – Statutory and Other Restrictions’.

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Reportedly, the penalties have been imposed in exercise of powers vested in RBI under the provisions of section 47 A (1) (c) read with sections 46 (4) (i) and 51 (1), of the Banking Regulation Act, 1949, as applicable.

"This action is based on the deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the banks with their customers," RBI added in a report.

A penalty of Rs 1 crore has been imposed each on Bandhan Bank, Bank of Maharashtra, Central Bank of India, Credit Suisse AG, Indian Bank, IndusInd Bank, Karnataka Bank, Karur Vysya Bank, Punjab and Sind Bank, South Indian Bank, The Jammu & Kashmir Bank, and Utkarsh Small Finance Bank. 

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