RBI slaps fines on Bank of India & Bandhan Bank for breach of rules

The Reserve Bank of India (RBI) has imposed fines on Bank of India and Bandhan Bank for breach of rules, the central financial institution mentioned on Wednesday.

A penalty of Rs 1,40,76,000 has been imposed on Bank of India for non-compliance with the next RBI instructions:

(1) The financial institution didn’t pay curiosity in sure time period deposit accounts as per the schedule of rates of interest disclosed prematurely; (2) had levied SMS alert expenses from prospects primarily based on invalid cell numbers and never on precise utilization foundation; (3) did not reset rates of interest in Marginal Cost of Funds primarily based Lending Rate (MCLR) and exterior benchmark linked advances at prescribed periodicity; (4) did not benchmark the curiosity on sure floating fee retail loans and floating fee loans to MSME, to an exterior benchmark fee; (5) did not report or inaccurately reported information pertaining to sure giant debtors to Central Repository of Information on Large Credits (CRILC), and (6) did not furnish correct data to Credit Information Companies (CICs).

The RBI additionally imposed a penalty of Rs 29.55 lakh on Bandhan Bank Ltd for not complying with its instructions. The RBI mentioned that the penalties had been primarily based on supervisory findings of non-compliance with regulatory directions/ statutory provisions after contemplating the replies given by the banks to the problems that had been raised.

At the identical time, the RBI mentioned that the motion towards the 2 banks relies on deficiencies in regulatory compliance and isn’t meant to pronounce upon the validity of any transactions or settlement entered into by the banks with their prospects.

Further, imposition of the financial penalty is with out prejudice to some other motion which may be initiated by RBI towards the financial institution.

(With inputs from IANS)