The Reserve Bank of India (RBI) has imposed a monetary penalty of ₹1.40 crore on Bank of India for non-compliance with certain directions issued by the central bank. The key areas of non-compliance include:
The RBI conducted Statutory Inspection for Supervisory Evaluation (ISE) of the bank with reference to its financial position as on March 31, 2021, and March 31, 2022, and found instances of non-compliance.
The RBI issued a show-cause notice to the bank, and after considering the bank’s reply, oral submissions, and additional submissions, the central bank found the charges sustained, warranting the imposition of a monetary penalty.
Penalty on Bandhan Bank
The RBI has also imposed a monetary penalty of ₹29.55 lakh on Bandhan Bank for non-compliance with certain directions relating to Interest Rate on Deposits.
Penalty on Indostar Capital Finance
Additionally, the RBI imposed a monetary penalty of ₹13.60 lakh on Indostar Capital Finance for non-compliance with directions on ‘Monitoring of Frauds in NBFCs’ and certain provisions of ‘Know Your Customer (KYC)’.
The RBI has clarified that the actions are based on deficiencies in regulatory compliance and do not pronounce upon the validity of any transactions or agreements entered into by the banks with their customers. The imposition of monetary penalties is without prejudice to any other action that may be initiated by the RBI against the entities.
These penalties highlight the RBI’s commitment to ensuring strict compliance with regulatory guidelines and maintaining the integrity and stability of the banking and financial system.
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