The Reserve Bank of India (RBI) has taken major action on the country’s largest public banks State Bank of India, Indian Bank and Punjab and Sindh Bank. The apex bank has imposed fine on all three. The central bank said in a statement that a fine of Rs 1.3 crore has been imposed on SBI. Financial penalty has been imposed on banks by RBI for non-compliance with certain provisions of the instructions issued by RBI on ‘Loans and Advances – Statutory and Other Restrictions’ and intra-group transactions and management of debt. 1.62 lakh on Indian Bank for non-compliance with certain provisions of the Loans and Advances – Statutory and Other Restrictions, KYC (Know Your Customer) and Reserve Bank of India (Interest Rates on Deposit) Directions, 2016, the RBI said in another statement. A fine of Rs crore has been imposed. Apart from this, a fine of Rs 1 crore has been imposed on Punjab and Sindh Bank. This penalty has been imposed for not following some provisions of the Depositor Education and Awareness Fund Scheme. The central bank has approved Fedbank Financial Services Ltd. A fine of Rs 8.80 lakh has also been imposed. Penalty has been imposed for non-compliance with certain provisions related to prevention of fraud in non-banking financial companies (NBFCs).
License of ‘The Kapol Co-operative Bank’ canceled
RBI has canceled the license of ‘The Kapol Co-operative Bank Limited’ of Mumbai. The central bank said that the bank does not have sufficient capital and there are no earning prospects. The Reserve Bank said in a statement that with the cancellation of the license, the co-operative bank has been immediately banned from banking business, which includes accepting deposits and returning deposits. According to the statement, the Additional Secretary of the Ministry of Cooperation and the Central Registrar of Cooperative Societies have also been requested to issue an order to close the bank and appoint a liquidator for the bank. The Reserve Bank said that every depositor will be entitled to receive deposit insurance claim amount up to Rs 5 lakh from the Deposit Insurance and Credit Guarantee Corporation (DICGC). In this way, about 96.09 percent depositors of the bank will be entitled to get their entire deposit amount from DICGC.