RBI Fines SBI, Canara Bank For Regulatory Violations

The Reserve Bank of India imposed a penalty of Rs 2 crore on State Bank of India for flouting regulatory compliance rules, the central bank said in a press release on Monday.

The penalty is on account of violations related to depositor education awareness funds and shareholding in a company exceeding 30% of the paid-up share capital of that company.

The public sector bank held shares as a pledgee of an amount exceeding 30% of the paid-up share capital of certain companies, the RBI said. Further, the bank failed to credit an eligible amount to the Depositor Education and Awareness Fund within the period.

The central bank also penalised Canara Bank Ltd. for Rs 32.30 lakh for non-compliance with regulations. The RBI noted that the bank failed to rectify the rejected data and upload the same with the credit information companies within seven days of receiving such a rejection report from the CICs. Further, Canara Bank restructured certain accounts that were not standard assets as of March 31, 2021.

The RBI also fined City Union Bank Rs 66 lakh for violations related to the divergence of non-performing assets.

"There was significant divergence between the non-performing assets, as reported by them and as assessed during the inspection. It did not put in place a system of periodic review of risk categorisation of accounts of its customers," the RBI said in its press release.