State Bank of India, Canara Bank, and City Union Bank were hit with fines totaling about Rs 3 crore by the Reserve Bank of India (RBI) on Monday for breaking regulatory guidelines. According to the RBI, the fines in each instance are based on regulatory compliance gaps and aren't meant to rule on the legality of any agreements or transactions the firms have with their clients.
The Reserve Bank of India (RBI) said in a statement that the State Bank of India (SBI) has been fined Rs 2 crore for violating various regulations pertaining to the 2014 Depositor Education Awareness Fund Scheme.
By order dated February 26, 2024, the Reserve Bank of India (RBI) fined State Bank of India (the bank) ₹2.00 crore (Rupees Two Crore only) for violating the terms of sub-section (2) of Section 19 of the Banking Regulation Act, 1949 (the BR Act) and sub-section (2) of Section 26A of the BR Act in conjunction with the Depositor Education Awareness Fund Scheme, 2014. According to an RBI announcement, this fine was assessed in the execution of the authority granted to RBI under Section 47 A (1) (c) read in conjunction with Sections 46 (4) (i) and 51 (1) of the BR Act.
City Union Bank Limited has been fined Rs 66 lakh for failing to follow the RBI's Know Your Customer and Prudential Norms on Income Recognition, Asset Classification and Provisioning Pertaining to Advances—Divergence in NPA Accounts directives.
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By order dated February 8, 2024, the Reserve Bank of India (RBI) penalized City Union Bank Limited (the bank) ₹66.00 lakh (Rupees Sixty-six lakh only) for failing to comply with the 'Prudential Norms on Income Recognition, Asset Classification and Provisioning Pertaining to Advances - Divergence in NPA Accounts' and 'Reserve Bank of India (Know Your Customer (KYC)) Directions, 2016'. In another announcement, RBI stated, "This penalty has been imposed in the exercise of powers vested in RBI under the provisions of Section 47A(1)(c) read with Section 46(4)(i) of the Banking Regulation Act, 1949."
Canara Bank has also been hit with a penalty of Rs 32.30 lakh by the RBI for failing to follow certain guidelines.
In accordance with directives on "Data Format for Furnishing of Credit Information to Credit Information Companies and other Regulatory Measures," "Resolution Framework 2.0 – Resolution of Covid-19 related stress of Micro, Small, and Medium Enterprises (MSMEs)," and "Resolution Framework - 2.0: Resolution of Covid-19 Related Stress of Individuals and Small Businesses," Canara Bank (the bank) faces a monetary penalty of ₹32.30 lakh (Rupees Thirty two lakh thirty thousand only) by the Reserve Bank of India (RBI) on February 06, 2024.
In the exercise of the authority granted to RBI by section 47A(1)(c) read with sections 46(4)(i) and 51(1) of the Banking Regulation Act, 1949, as well as section 25(1)(iii) read with section 23(4) of the Credit Information Companies (Regulation) Act, 2005, this penalty has been imposed, according to an RBI release.
