RBI Slaps Rs59.20 Lakh Penalty on South Indian Bank
Moneylife Digital Team 11 November 2024
Reserve Bank of India (RBI) has imposed a penalty of Rs59.20 lakh on South Indian Bank Ltd for non-compliance with directions issued by RBI on interest rates on deposits and customer service in banks.
 
After conducting the statutory inspection for supervisory evaluation (ISE 2023), RBI found that South Indian Bank had imposed penal charges for not maintaining the minimum or average minimum balance without notifying some customers through SMS, email, or letters. 
 
Additionally, South Indian Bank had placed a lien on some non-resident external (NRE) savings deposit accounts.
 
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 the lender were sustained, warranting imposition of monetary penalty.
 
However, the banking regulator clarified that its action against South Indian Bank is based on deficiencies in regulatory compliance and is not intended to pronounce on the validity of any transactions or agreements entered into by the Bank with its customers. Further, imposition of a monetary penalty is without prejudice to any other action that may be initiated against the Bank, RBI added.
Comments
GOWRISHANKAR
4 months ago
The number of lapses on the part of banks are in 1000s; however, what is detected by the Regulator is just miniscule. Why? Partly on the huge amount of work pressure on the officials and partly on account of their complacent attitude sometimes. Who is to blame? Easy to blame the scape goat being the Client of a bank. Ha...ha...ha...
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