The Reserve Bank of India (RBI) today imposed penalty on Central Bank of India, one of the Public Sector Banks of the country. The RBI said the central bank is not complying with certain provisions of the norms relating to classification and reporting of frauds.

fine of Rs.

RBI has imposed a fine of Rs 84.50 lakh. The Reserve Bank conducted a statutory inspection for its supervisory assessment of the financial position of the central bank as on March 31, 2021.

Scrutiny of reports revealed that the central bank failed to report the Joint Lenders Forum’s (JLF) accounts as frauds to the RBI within seven days of its decision to declare them as frauds. Further, the bank charged its customers SMS alert charges on a flat basis rather than on actual usage.

RBI issued show cause notice

Taking strong action in this matter, the RBI issued a show cause notice to the central bank and asked why penalty should not be imposed on it for failure to comply with the directions.

fine on rbi

After considering the bank’s reply to the show cause notice and the oral submissions made during the personal hearing, RBI decided that the allegation of non-compliance of the above directions by RBI is proved, following which RBI may impose penalty on the Central Bank. Is. However, the RBI said the penalty is based on lapses in regulatory compliance and is not intended to affect the validity of any transaction or contract entered into by the bank with its customers.