SBI, BoI, BoB and other PSBs will pay crores of rupees as fine to RBI

New Delhi: For failing to comply with numerous banking norms, the Reserve Bank of India (RBI) slapped penalties of Rs 5 crore on four public sector banks including State Bank of India (SBI) and Corporation Bank. The country's central bank asked Corporation Bank to pay a penalty of Rs 2 crore while imposing fines of Rs 1 crore each on SBI, Union Bank of India and Bank of Baroda.

Non-compliance with RBI directions

The monetary penalty on the state-run banks has been imposed for not acting in accordance with various directions issued by the RBI on the restructuring of accounts, exchange of information with other banks, monitoring of end-use of funds and classification and reporting of frauds, it said in a statement.

However, the central bank added that the fines are based on deficiencies in regulatory compliance and "is not intended to pronounce" upon the validity of any transaction or agreement entered into by the banks with their customers, RBI added.

"These penalties have 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 above banks to adhere to the aforesaid directions issued by RBI," it said.

RBI issued penalties on 7 lenders on Tuesday

Earlier this week, the RBI also imposed penalties on seven lenders — HDFC, Allahabad Bank, Bank of Maharashtra, Kotak Mahindra Bank, Indian Overseas Bank, Andhra Bank and IDBI Bank — for violation of various banking norms.