RBI Slaps Rs1.06 Crore Penalty on Union Bank of India
Moneylife Digital Team 12 August 2024
Reserve Bank of India (RBI) has imposed a penalty of Rs1.06 crore on Union Bank of India for non-compliance with directions on creating a central repository of large common exposures across banks and know-your-customer (KYC).
 
After conducting a statutory inspection for supervisory evaluation (ISE 2022), RBI found that Union Bank failed to ensure data accuracy and integrity in its reporting to the Central Repository of Information on Large Credits (CRILC) and did not perform risk categorisation for certain customers. 
 
After considering the Bank’s reply to the notice, oral submissions made during the personal hearing and examination of additional submissions made by it, RBI says the charges against Union Bank were sustained, warranting imposition of monetary penalty.
 
However, the banking regulator clarified that its action against Union Bank of India is based on deficiencies in regulatory compliance and is not intended to pronounce on the validity of any transactions or agreement entered into by the Bank with its customers. Further, imposition of monetary penalty is without prejudice to any other action that may be initiated against the Bank, RBI added.
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