The Reserve Bank of India took action against all the banks for violating the rules. Banks have also been fined for this.
RBI action against banks
The Reserve Bank of India (RBI) has imposed monetary penalty on 14 banks including Bandhan Bank, Bank of Baroda and State Bank of India (SBI) for violating various norms. These 14 banks include public sector banks, private banks, foreign banks, co-operative banks and a small finance bank. This information was given in a press release issued by the Reserve Bank itself.
“The action is being taken for non-compliance of certain provisions of Bank Finance to Non-Banking Financial Companies (NBFCs) and ‘loan-advance and other restrictions’,” the RBI said. According to a source, the RBI’s penalty on these banks is mainly related to the banks’ dealings with the troubled Dewan Housing Finance Corporation (DHFL) and its group companies.
The RBI release said that in the examination of the accounts of a group of companies by the Reserve Bank, it was found that the banks have failed to comply with the provisions of one or more of the above directions issued by the RBI. It has also violated the provision of the Banking Regulation Act, 1949.
In this regard, notices were issued to banks and asked to show reasons. Action was taken if the reply was not found satisfactory. Other banks against whom monetary penalties have been imposed 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, Jammu and Kashmir Bank and Utkarsh Small Finance Bank Incorporated.
Action was also taken on these two banks
A few days ago, the Reserve Bank of India (RBI) also took action against Punjab and Sind Bank for violating the rules related to cyber security. A fine of Rs 25 lakh was imposed on the banks. According to RBI, the bank has not complied with the Cyber Security Framework norms. This government-owned bank was informed about some cyber incidents on May 16 and May 20, 2020, yet it was negligent.
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