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RBI fines IndusInd Bank Rs 4.50 crore for violation of rules – Moneycontrol

The Reserve Bank of India (RBI) has imposed a monetary penalty of Rs 4.50 crore on IndusInd Bank Limited for non-compliance with certain prudential norms, the central bank said in a release.

The violation is in relation to provisions of directions issued by RBI on ‘Exposure Norms’, ‘Prudential Norms on Income Recognition, Asset Classification and Provisioning pertaining to Advances’ among others, the RBI said.

Also, the bank was found violating ‘SPARC – Monitoring of Information Submission by bank’, ‘Creation of a Central Repository of Large Common Exposures – Across Banks’ read with directions on ‘Central Repository of Information on Large Credits (CRILC) – Revision in Reporting’, and ‘Disclosure in Financial Statements- Notes to Accounts’, the RBI said..

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

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This action is based on the deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers, the RBI said.

The statutory inspection of the bank with reference to its financial position as on March 31, 2019 and the Risk Assessment Report (RAR) pertaining thereto revealed non-compliance with the above-mentioned directions issued by RBI, the central bank said.

“In furtherance to the same, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed for its failure to comply with the directions issued by RBI,” the RBI said.

After considering the bank’s reply to the notice, oral submissions made during the personal hearing and examination of additional submissions, RBI decided to impose monetary penalty on the bank, to the extent of non-compliance with the aforesaid directions, the central bank said.