According to an official statement issued by the Reserve Bank of India (RBI) on Friday, monetary penalties have been imposed on private lenders Axis Bank and IDBI Bank. Axis Bank has been fined 93 lakh rupees, while IDBI Bank has been fined 90 lakh rupees by the Reserve Bank.
On Friday, Axis Bank shares rose 0.5 percent to 796.10 per share on the NSE, while IDBI Bank shares fell 0.21 percent to 47.65 per share.
The RBI has imposed a monetary penalty on Axis Bank for failing to comply with RBI directives on loans and advances, KYC guidelines, and penalties for failing to maintain a minimum balance in savings accounts.
According to the RBI, Axis Bank broke certain rules by failing to maintain the required margin in the event of a loss.
The Bank also used restrictive practices in the sale of insurance products to customers, failing to compare copies of officially valid documents produced by clients with originals when establishing account-based relationships, having instances of customer IDs with multiple CIFs instead of a Unique Customer Identification Code (UCIC), and levying penal charges for failure to maintain a minimum balance in savings bank accounts that were not directly proportional to the exorbitant fees.
The lender failed to implement time restrictions on holidays and data access control for corporate net banking to put through fund transfers, resulting in unauthorized debit transactions in the accounts of two co-operative banks, according to RBI. The RBI had sent notices to both banks, advising them to show cause why they should not be penalised for failing to follow the instructions.