RBI Slaps ₹1.45 Crore Penalty On Central Bank of India

RBI Slaps ₹1.45 Crore Penalty On Central Bank of India

The RBI imposed the penalty of the bank's failure to adhere to RBI directives on 'Loans and Advances' and 'Customer Protection in Electronic Banking Transactions'.

Oliviya KunjumonUpdated: Friday, June 14, 2024, 08:14 PM IST
article-image
RBI Slaps ₹1.45 Crore Penalty On Central Bank of India | Image: Wikipedia (Representative)

The Reserve Bank of India on Friday said that it has levied a hefty penalty of Rs 1,45,50,000 (Rs 1.455 Crore) on the Central Bank of India.

The RBI imposed the penalty of the bank's failure to adhere to RBI directives on 'Loans and Advances' and 'Customer Protection in Electronic Banking Transactions', according to press release issued on Friday.

"This penalty has been imposed in exercise of powers vested in RBI conferred under the provisions of section 47 A (1) (c) read with sections 46 (4) (i) and section 51(1) of the Banking Regulation Act, 1949," added the release.

Background

The RBI conducted its Statutory Inspection for Supervisory Evaluation (ISE 2022) of Central Bank of India based on its financial position as of March 31, 2022. Following this inspection, it was revealed that the bank had not complied with several critical RBI directives.

Details of Non-Compliance

The Central Bank of India sanctioned a working capital demand loan to a corporation using amounts receivable from the government as subsidies and the bank also failed to promptly credit the amounts involved in unauthorised electronic transactions back to customers' accounts within the stipulated 10 working days.

Moreover, as required by RBI guidelines, the bank did not resolve customer complaints or provide compensation within 90 days of receiving the complaints.

Reserve Bank of India

Reserve Bank of India | File/ Representative

RBI's Response and Penalty Imposition

After issuing a notice to Central Bank of India, RBI reviewed the bank's response, conducted a personal hearing, and examined additional submissions.

Despite these interactions, RBI found the charges against the bank to be substantiated, leading to the imposition of the monetary penalty, the RBI said.

RECENT STORIES

FPIs Invest ₹15,352 Crore In Equities In First Two Weeks Of July

FPIs Invest ₹15,352 Crore In Equities In First Two Weeks Of July

'Welcome To The Roast Of Zomato': Delivery Company Holds A Self-Roasting Show Featuring Rival...

'Welcome To The Roast Of Zomato': Delivery Company Holds A Self-Roasting Show Featuring Rival...

Elon Musk Raises Alarm After Trump Shooting, Says People Have Tried To Kill Him

Elon Musk Raises Alarm After Trump Shooting, Says People Have Tried To Kill Him

Next Round Of India-Korea FTA Review Meeting From July 17 In Seoul

Next Round Of India-Korea FTA Review Meeting From July 17 In Seoul

'SS Leadership Must Resign': Elon Musk Attacks US Secret Service Over Donald Trump Firing, Calls...

'SS Leadership Must Resign': Elon Musk Attacks US Secret Service Over Donald Trump Firing, Calls...