In a recent development, the Reserve Bank of India (RBI) has levied monetary penalties on Citibank, Bank of Baroda (BoB), and Indian Overseas Bank (IOB) for violations of regulatory compliance.
The penalties imposed are as follows:
– Citibank: Rs 5 crore
– Bank of Baroda: Rs 4.34 crore
– Indian Overseas Bank: Rs 1 crore
Citibank incurred the penalty for contravention of Section 26A of the Banking Regulation Act, 1949, and non-compliance with RBI Directions on ‘Managing Risks and Code of Conduct in Outsourcing of Financial Services by banks.’
Bank of Baroda faced the penalty for non-compliance with specific directions issued by RBI related to the ‘Creation of a Central Repository of Large Common Exposures – Across Banks.’
Indian Overseas Bank received the penalty for non-compliance with certain directions issued by RBI concerning ‘Loans and Advances – Statutory and Other Restrictions.’
The central bank had issued notices to the respective banks, urging them to provide reasons for non-compliance and why a penalty should not be imposed, as mentioned in the notice.
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