The Reserve Bank of India (RBI) has imposed a monetary penalty of Rs 1 crore on South Indian Bank Limited for non-compliance with certain provisions of the Reserve Bank of India Act, 1934. The penalty was imposed as the bank failed to submit the required reports and statements on time, and also did not comply with certain regulations related to Know Your Customer (KYC) norms and customer due diligence.
The RBI found that the bank had not filed its quarterly and annual reports in a timely manner, which is a violation of Section 10(4) of the Reserve Bank of India Act, 1934. Additionally, the bank did not follow the KYC norms and customer due diligence requirements as specified by the RBI.
The penalty was imposed to promote timely submission of reports and statements by banks and to ensure compliance with RBI regulations. The RBI emphasized the importance of banks in maintaining the stability and integrity of the financial system and urged them to adhere to regulatory requirements.
The monetary penalty is to be deposited with the RBI within a period of 30 days from the date of the RBI’s letter. The penalty is seen as a measure to deter similar violations by other banks and to maintain the confidence of customers in the banking system.