RBI imposes 1.45 crore fine on Central Bank of India, 96.4 lakh fine on Bangladesh’s Sonali Bank

The Reserve Bank of India (RBI) imposed a fine of ₹1.45 crore on the Central Bank of India and ₹96.4 lakh on Sonali Bank PLC for non-compliance issues including loans and advances and Know Your Customer (KYC) norms, PTI reported.

The Central Bank of India was fined ₹1.45 crore for sanctioning a working capital demand loan to a corporation against amounts receivable from the government by way of subsidies. Additionally, the bank failed to credit (shadow reversal) the amount involved in a few instances of unauthorized electronic transactions to customers’ accounts within the stipulated time.

The RBI conducted a Statutory Inspection for Supervisory Evaluation (ISE 2022) of the Central Bank of India on its financial position as of March 31, 2022. “After considering the bank’s reply to the notice, oral submissions made during the personal hearing and examination of additional submissions made by it, RBI found, inter alia, that the following charges against the bank were sustained, warranting imposition of monetary penalty,” said the RBI in a press release.

In another press release, the RBI stated that a penalty of ₹96.4 lakh had been imposed on Sonali Bank PLC for non-compliance with certain norms, including the KYC Directions, 2016.

Sonali Bank PLC’s Indian wing is part of the commercial Bank of Bangladesh.

“The action is based on deficiencies in statutory and regulatory compliance and is not intended to pronounce upon the validity of any transactions or agreement entered into by the bank with its customers. Further, imposition of monetary penalty is without prejudice to any other action that may be initiated by RBI against the bank,” also said the RBI.

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