Reserve Bank Of India / RBI imposed fine on these 3 banks including PNB, the penalty is so huge

The Reserve Bank of India has imposed fines of ₹61.4 lakh, ₹38.6 lakh and ₹29.6 lakh respectively on Kotak Mahindra Bank, IDFC First Bank and PNB for regulatory violations. Meanwhile, Yes Bank has received a notice of tax demand of ₹244.20 crore for 2016-17, which the bank termed as baseless.

Reserve Bank Of India: The Reserve Bank of India (RBI) has recently taken an important step to maintain transparency and discipline in the banking system. RBI has imposed a fine on Kotak Mahindra Bank, IDFC First Bank and Punjab National Bank (PNB) for lapses in regulatory compliance. This fine has been imposed due to violation of various RBI guidelines by the banks.

Fine of 61.4 lakhs on Kotak Mahindra Bank

RBI said in a statement that Kotak Mahindra Bank did not fully comply with the rules issued under "Guidelines on the Credit System for Bank Loan Distribution" and "Loans and Advances - Statutory and Other Restrictions". Due to these lapses, a fine of Rs 61.4 lakh has been imposed on the bank. This fine highlights the lapses in the bank's loan policy and its implementation.

Impact of KYC violation on IDFC First Bank

In another statement, RBI informed that IDFC First Bank had to pay a penalty of Rs 38.6 lakh for not properly following the 'Know Your Customer' (KYC) rules. Violation of KYC norms is not only serious from the regulatory point of view but it can also lead to risks like money laundering.

Negligence in customer service on Punjab National Bank

Punjab National Bank has had to pay a fine of Rs 29.6 lakh for not following RBI guidelines related to 'customer service in banks'. This case indicates neglect of customer interests and reduction in service quality.

RBI has clarified that these fines have been imposed only due to regulatory lapses and are not intended to affect the validity of transactions between banks and customers.

Yes Bank gets big blow from Income Tax Department

On the other hand, Yes Bank has received a demand notice of Rs 244.20 crore from the Income Tax Department. This notice has been issued on the basis of reassessment of the assessment year 2016-17. The bank said that the Income Tax Department has made this demand based on the reassessment income instead of the income shown in its return.

Yes Bank says that this demand has been made "without any solid basis" and it will file a correction application against this order. Also, it will consider all legal options including appealing.