The Reserve Bank of India (RBI) on Monday imposed a penalty of Rs 7 crore on State Bank of India for non-compliance of directions.
The state-owned SBI was found to have violated asset classification norms, bad loans classification, fraud risk management and reporting of frauds.
The RBI directions specifically relate to Income Recognition and Asset Classification (IRAC) norms, code of conduct for opening and operating current accounts and reporting of data on Central Repository of Information on Large Credits (CRILC), fraud risk management and classification and reporting of frauds.
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The penalty has been imposed in exercise of powers vested in RBI under the provisions of section 47A (1)(c) read with sections 46(4)(i) and 51(1) of the Banking Regulation Act 1949.
“Based on the inspection report and other relevant documents, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed on it for non-compliance with directions issued by RBI,” said a statement issued by the banking regulator.
“RBI came to the conclusion that the aforesaid charges of non-compliance with RBI directions were substantiated and warranted imposition of monetary penalty,” it said adding the action is based on deficiencies in regulatory compliance and not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers.
(With ANI inputs)