The Reserve Bank of India on September 9 imposed a monetary penalty on Indiabulls Commercial Credit, Industrial Bank of Korea and Woori Bank for not complying with norms.
The banking regulator has imposed a penalty of Rs 12.35 lakh on Indiabulls Commercial Credit for non-compliance with certain provisions pertaining to Know Your Customer (KYC), the RBI said in a press release. An inspection report of the RBI revealed the company’s failure to allot Unique Customer Identification Code (UCIC) to its individual customers and carry out categorisation of customers based on its assessment and risk perception, it said.
Additionally, the RBI has also penalised Industrial Bank of Korea with Rs 36 lakh for failing to put in place a system of periodic review of risk categorisation of accounts, the central bank said in another release.
The regulator has also imposed a monetary penalty of Rs 59.10 lakh on Woori Bank, as it did not report information on the Central Repository of Information on Large Credits (CRILC) in respect of customers with non-fund based exposure of more than Rs 5 crore, and failed to pay interest on deposits at rates strictly as per the schedule of interest rates disclosed in advance, in certain instances.
In furtherance to above violations, a notice was issued to the entities separately, advising them to show cause as to why penalty should not be imposed for failure to comply with the RBI directions. After considering each entities’ reply to the notice and oral submissions made during the personal hearing, the RBI came to the conclusion that the charge of non-compliance was substantiated and warranted imposition of monetary penalty, the central bank said.
However, all the actions are based on the deficiencies in regulatory compliance and are not intended to pronounce upon the validity of any transaction or agreement entered into by the entities with its customers, the central bank added.
The central bank has been tightening its grip on regulated entities to ensure that regulatory norms are adhered to in the interest of financial stability and protection of consumer interest.
