The Reserve Bank of India (RBI) has imposed penalty on three banks — Bank of India, Karnataka Bank and Saraswat Co-operative Bank Ltd. The regulator took this decision after it found deficiencies in regulatory compliance.
Bank of India, Karnataka Bank and Saraswat Co-operative Bank Ltd will have to shell out Rs 5 crore, Rs 1.20 crore and Rs 30 lakh respectively as fine.
In the case of Karnataka Bank, the regulator pulled up the bank for “non-compliance with certain provisions of directions issued by RBI on prudential norms on income recognition, asset classification and provisioning pertaining to advances — divergence in NPA account and prudential norms on income recognition, asset classification and provisioning pertaining to advances.”
Meanwhile, Bank of India was fined for non-compliance with provisions of the directions issued by RBI on income recognition, asset classification and provisioning pertaining to advances — divergence in NPA account, opening of current accounts by banks — need for discipline, and classification and reporting of frauds, the regulator stated.
Saraswat Co-operative Bank Ltd was fined for non-compliance with directions issued by RBI on income recognition, asset classification (IRAC) norms.
This penalty has been imposed by RBI under the provisions of section 47A (1) (c) of the Banking Regulation Act, 1949 (the Act).
