The penalty is levied for non-compliance with RBI directives.
The Reserve Bank of India (RBI) has slapped a penalty of ₹ 50 million on South Indian Bank Limited for non-compliance with the directions issued by it.
The non-compliance pertains to Income Recognition and Asset Classification (IRAC) norms, Know Your Customer (KYC) norms and treasury function. Further, the bank is also pulled up for deficiencies in its compliance function and compliance culture.
`` This penalty has been imposed in exercise of powers vested in RBI under the provisions of Section 47A(1)(c) read with Section 46(4)(i) of the Banking Regulation Act, 1949, taking into account failure of the bank to adhere to the aforesaid directions issued by RBI,’’ a release said.
``This action is based on 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 in a release.
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