RBI imposes penalties on Godrej Housing, HUDCO, and Aadhar Housing Finance
The Reserve Bank of India (RBI) on July 5 imposed a monetary penalty of ₹1.32 crore on Punjab National Bank (PNB) for violations related to loans and advances and Know Your Customer (KYC) norms.
The penalty was imposed due to PNB sanctioning working capital demand loans to two state government-owned corporations against amounts receivable from the government by way of subsidies, refunds, or reimbursements. Additionally, the bank failed to preserve records pertaining to the identification of customers and their addresses obtained during business relationships in certain accounts.
The RBI conducted the Statutory Inspection for Supervisory Evaluation (ISE 2022) of PNB, referencing its financial position as of March 31, 2022. The findings revealed non-compliance with RBI directions, leading to the issuance of a show-cause notice to the bank.
After considering oral submissions made in response to the show-cause notice, the RBI decided to impose the monetary penalty on PNB. The central bank emphasized the importance of adhering to its directions on loans, advances, and KYC norms to ensure financial discipline and integrity.
PNB is one of India’s oldest and largest public sector banks, with a wide network of branches across the country and a significant presence in international markets.
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