RBI slaves Rs 4 crore penalty on Citibank NA and Rs 1.45 crore on three other whistleblowing banks

KOLKATA: The Reserve Bank of India has imposed Rs 4 crore penalty on Citibank NA and Rs 1.45-crore on three whistleblower urban cooperation banks banking regulations.

The regulator said the penalty on Citibank was for failing to comply with the instructions in relation to the customers’ credentials. It said the lender overlooked its directions to get statements from customers about credit facilities enjoyed with other banks, provide non-funded facilities to non-composite borrowers, verify the available data in CRILC database and retrieval No-objection certificate (NOC) from bank lending at the time of opening current accounts and submitting compliance to found risk assessments.

“This action is based on deficiencies in regulatory compliance and is not intended to comment on the validity of any transaction or agreement the bank has entered into with its customers,” RBI said Friday.

Earlier, the regulator had sent a message to the bank requesting reasons why no penalty should be imposed for non-compliance with RBI’s instructions. “After considering the bank’s response to the executive order, oral submissions made during the personal hearing and investigation of further submissions, the RBI concluded that the above allegations of violation of the law’s provisions and non-compliance with RBI directions warranted the imposition of monetary punishment, It said.

In parallel, the RBI has charged Rs 60 lakh at Bharat Co-operative Bank (Mumbai), Rs 45 lakh at Thanes TJSB Sahakari Bank and Rs Rs 40 lakh at Ahmedabad’s Nagar Urban Co-operative Bank for the settlement of the asset classification rules.

On Thursday, the Bank of India and two other lenders were punished for a rule violation.

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