The Reserve Bank of India (RBI) announced on Wednesday that it has fined Bank of India with a penalty of Rs 1.4 crore for failing to comply with certain regulatory rules. Additionally, the RBI has imposed a penalty of Rs 29.55 lakh on private sector lender Bandhan Bank for similar non-compliance issues.
Bank of India’s penalty was levied due to its failure to adhere to RBI’s directives regarding various aspects such as ‘interest rates on deposits’, ‘customer service in banks’, ‘interest rates on advances’, and violations of Credit Information Companies Rules, 2006.
The RBI conducted a statutory inspection to assess Bank of India’s compliance with regulatory requirements, based on its financial status as of March 31, 2021, and March 31, 2022.
Similarly, Bandhan Bank was penalized for non-compliance with regulatory directives. The penalties imposed on both banks were due to deficiencies in meeting regulatory standards and do not imply any judgment on the validity of their transactions or agreements with customers, clarified the RBI.
In addition to Bank of India and Bandhan Bank, Indostar Capital Finance Ltd also faced a penalty of Rs 13.60 lakh for non-compliance with the ‘Monitoring of Frauds in NBFCs (Reserve Bank) Directions, 2016’, and certain provisions of KYC (Know Your Customer) directives.
Overall, the penalties were imposed to address deficiencies in regulatory compliance and to ensure adherence to RBI’s guidelines.
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