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This article is more than 2 month old.

RBI fines SBI, 13 other banks over non-compliance with various norms

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The Reserve Bank of India (RBI) has imposed monetary penalties on 14 banks, including State Bank of India and Bank of Baroda, for flouting norms.

RBI fines SBI, 13 other banks over non-compliance with various norms
The Reserve Bank of India (RBI) has imposed monetary penalties on 14 banks, including top lenders like the State Bank of India (SBI) and Bank of Baroda on account of various violations.
The banks facing penalties include private banks, public sector banks, cooperative banks, a foreign bank, and a small finance bank.
In a statement on Wednesday, the central bank said that 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.’
The penalties are also linked to the banks' dealings with crisis-ridden Dewan Housing Finance Corporation (DHFL) and its group companies, Moneycontrol reported, citing an industry source.
“A scrutiny in the accounts of the companies of a Group was carried out by RBI and it was 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 central bank said.
As per the Moneycontrol report, the group mentioned by RBI is DHFL.
RBI added that notices were issued to the banks advising them to show cause as to why penalty should not be imposed for non-compliance with the directions/contraventions of provisions of Banking Regulation Act, 1949.
The highest penalty of Rs 2 crore has been imposed on the Bank of Baroda. A fine of Rs 1 crore each has been imposed 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.
India’s largest lender SBI has to pay a fine of Rs 50 lakh.
“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,” RBI said.
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, it added.