Mumbai (Maharashtra) [India], Apr. 12 (ANI): The Reserve Bank of India (RBI) imposed monetary penalty worth Rs. 3 crore on IDBI Bank for not complying with the outlined norms related to reporting of bad loans.
In an official notice, the RBI said the penalty was imposed on account of non-compliance with the directions issued on Income Recognition and Asset Classification (IRAC) norms.
"This penalty has been imposed in exercise of powers vested in the 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 bank to adhere to the aforesaid directions issued by the RBI," the notice read.
Furthermore, the central bank stated that this action is based on deficiencies in regulatory compliance, and not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers.
In May last year, the RBI had invoked prompt corrective action (PCA) on the state-owned Bank due to its bad loans and return on assets (ROA).
However, IDBI in a regulatory filing had stated that the action would not have any material impact on the performance of the bank, adding that it would contribute to improving internal monitoring and improve its activities.
On a related note, the RBI in May imposed a penalty of Rs. 589 million on ICICI Bank Limited for non-compliance with directions issued on direct sale of securities from its Held to Maturity (HTM) portfolio and specified disclosure in this regard. (ANI)
This story has not been edited. It has been published as provided by ANI