|
“This action is based on the deficiencies in regulatory compliance observed and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers,” the central bank said in a filing.
Meanwhile, the Reserve Bank had carried out a scrutiny of the bank in July 2020 based on a high value fraud reported by the bank. The examination of scrutiny report and all related correspondence pertaining to the same, revealed, inter alia, non-compliance with the aforesaid directions by the bank to the extent the bank failed to undertake customer due diligence measures as mandated while opening an account in the name of a sole proprietary firm.
In furtherance to the same, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed on it for failure to comply with the said directions, as stated therein.
The apex bank added, “After considering the bank's reply to the notice, oral submissions made during the personal hearing and additional submissions made by it, RBI came to the conclusion that the charge of non-compliance with the aforesaid RBI directions was substantiated and warranted imposition of monetary penalty on the bank, to the extent of non-compliance with such directions.”
In a filing RBI said, “This penalty has 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.”
Indian Bank is a public sector bank. The Government of India held 79.86% stake in the bank as on 31 December 2022.
The bank reported 102.36% jump in standalone net profit to Rs 1,395.76 crore on 18.02% rise in total income to Rs 13,550.68 crore in Q3 FY23 over Q3 FY22.
The scrip ended 0.41% lower at Rs 288.35 on Thursday, 6 April 2023.
The domestic stock market is shut today, 7 April 2023, on account of Good Friday.
|