MUMBAI, Oct 28:The Reserve Bank has imposed a penalty of Rs 35 lakh on Tamilnad Mercantile Bank for violating norms on frauds classification and notification.
The central bank imposed the fine via an order dated October 24, 2019.
The bank has been penalised for “non-compliance with certain provisions of directions issued by RBI on frauds classification and reporting by commercial banks and select FIs directions 2016,” the RBI said in a release on October 25.
“This action is based on the deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers,” the central bank said.
The RBI had conducted a statutory inspection of Tamilnad Mercantile Bank on its financial position as on March 31, 2017, based on which a show cause notice was issued to the bank as to why penalty should not be imposed for non-compliance with the directions.
After considering the bank’s reply to the notice and oral submissions made in the personal hearing, the RBI concluded that the non-compliance warranted imposition of monetary penalty, it said further. (PTI)
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