RBI Slaps Penalties on Major Banks for Regulatory Violations

The Reserve Bank has imposed financial penalties on Jammu and Kashmir Bank, Bank of India, and Canara Bank for regulatory compliance deficiencies. Penalties include Rs 3.31 crore for Jammu and Kashmir Bank, Rs 1 crore for Bank of India, and Rs 1.63 crore for Canara Bank, highlighting lapses in financial regulations.

The Reserve Bank of India has imposed significant monetary penalties on three prominent banks due to lapses in regulatory compliance, it announced on Friday.

Jammu and Kashmir Bank faces a hefty Rs 3.31 crore penalty for failing to adhere to norms related to financial inclusion, particularly concerning the Basic Savings Bank Deposit Account (BSBDA), Know Your Customer (KYC) standards, and statutory restrictions on loans and advances.

Similarly, the Bank of India has been fined Rs 1 crore for violating provisions of the Banking Regulation Act, 1949. Canara Bank has been hit with a Rs 1.63 crore penalty for not complying with directions on priority sector lending and deposit interest rates. The RBI clarified that these penalties are based on regulatory compliance deficiencies and do not reflect the validity of transactions or agreements between the banks and their customers.

(With inputs from agencies.)