The Reserve Bank of India (RBI) has imposed penalties on State Bank of India and Canara Bank for non-compliance with banking regulations. SBI was penalized Rs 2 crore for contravention of provisions of the Banking Regulation Act. Canara Bank received a penalty of Rs 32.30 lakh for not following RBI directions on credit information.
The RBI found that SBI held shares exceeding 30 per cent of paid-up share capital of certain companies and failed to credit the Depositor Education and Awareness Fund within the prescribed period. Canara Bank did not rectify rejected data and upload it to Credit Information Companies within seven days of receipt, and also restructured accounts that were not standard assets as per the regulations.
The penalties were based on the deficiencies in regulatory compliance and not meant to question any transactions with customers. RBI aims to ensure that all banks adhere to the set guidelines for the smooth functioning of the banking sector. The banks must take necessary actions to avoid such penalties in the future.
