The Reserve Bank of India has recently imposed a penalty of Rs 4crores on Citibank for non-compliance with various regulatory directions and norms of the central bank.
The penalty has been imposed on Citibank NA for contravention of certain sections of the Banking Regulation Act and for non-compliance with directions, said RBI in a release.
The regulatory directions pertained to obtaining declaration from customers about credit facilities enjoyed with other banks, verifying data available in CRILC database and obtaining NOC from lending banks at the time of opening current accounts, granting non-fund based facilities to non-constituent borrowers, and submission of compliance to risk assessment findings.
The statutory inspection of the Indian operations of the bank with reference to its financial positions as of March 31, 2017 and March 31, 2018 and the Risk Assessment Reports (RARs) pertaining thereto revealed inter-alia, contraventions with the provisions of the Act and non-compliance with certain directions issued by the central bank. Following this, a notice was issued to Citibank, said RBI.
The penalty has been imposed by an order dated January 8, 2020.
The RBI has also issued penalty on three co-operative banks for non-compliance with various directions issued by it.
A penalty of Rs 60 lakhs on Bharat Co-operative Bank (Mumbai), a penalty of Rs 40 lakhs on Nagar Urban Co-operative Bank (Ahmednagar) and a penalty of Rs 45 lakhs on TJSB Sahakari Bank Ltd has been imposed.
