Reserve Bank of India imposes Rs 1 crore penalty on Union Bank of India
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Loading... - Ajeet Amin
- 30 Nov 2021
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The Reserve Bank of India on Monday imposed a monetary penalty of Rs 1 crore on state-owned Union Bank of India for deficiencies in regulatory compliance. The penalty was imposed by an order dated 25 November for non-compliance with the certain provisions of directions issued by the RBI contained in Reserve Bank of India (Fraud - Classification and Reporting by commercial banks and select FIs) Directions 2016 and Guidelines on Sale of Stressed Assets by Banks.
The banking regulator, in a statement, said, "This action is based on the 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."
Giving details, the RBI in a statement said the statutory inspection for supervisory evaluation (ISE) of the bank was conducted by it with reference to its financial position as of 31 March, 2019.
Examination of the risk assessment report, inspection report and all the related correspondences revealed, inter alia, non-compliance with certain directions to the extent of failure to classify an account as a Red Flag Account despite the presence of early warning signals and failure to disclose ageing of and provisioning for security receipts (SRs) in its annual report, the RBI said.
The central bank, however, added that the penalty is based on the 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.
A notice was issued to the bank advising it to show cause as to why penalty should not be imposed on it for non-compliance with the RBI directions, RBI added. Read More…
