New Delhi: The Reserve Bank of India (RBI) on Wednesday imposed monetary penalty on 14 banks including Bandhan Bank, Bank of Baroda and State Bank of India (SBI) for non-compliance of rules. Notably, these 14 banks include public sector banks, private banks, foreign bank, Co-operative banks and one small finance bank.
The RBI in a statement said that the violations include non-compliance with certain provisions of directions issued on ‘Lending to Non-Banking Financial Companies (NBFCs)’ ‘Bank Finance to Non-Banking Financial Companies (NBFCs)’ and ‘Loans and Advances – Statutory and Other Restrictions’.
Probably, this is the first time when the highest number of banks have received monetary penalties from the RBI on a single day for various rule violations.
As per updates, the RBI penalties on these banks are mainly linked to banks’ dealings with crisis-ridden Dewan Housing Finance Corporation (DHFL) and its group companies.
Full list here:
Moreover, the RBI said that a scrutiny in the accounts of the companies of a group was carried out by the central bank and it was subsequently observed that the banks had failed to comply with provisions of one or more of the aforesaid directions issued by RBI and/or contravened provisions of the Banking Regulation Act, 1949, the RBI said.
As per the updates from the Central bank, the violations pertain to rules on ‘Creation of a Central Repository of Large Common Exposures – Across Banks’, ‘Reporting to Central Repository of Information on Large Credits (CRILC)’, ‘Operating Guidelines for Small Finance Banks’ and for contraventions of provisions of Section 19(2) and Section 20 (1) of Banking Regulation Act, 1949.
Other banks which received the monetary penalties include Bank of Maharashtra, Central Bank of India, Credit Suisse, Indian Bank, IndusInd Bank, Karnataka Bank, Karur Vysya Bank, Punjab and Sind Bank, South Indian Bank, The Jammu and Kashmir Bank and Utkarsh Small Finance Bank.
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