MUMBAI: The State Bank of India (SBI), the country’s largest bank, was slapped with a fine of Rs 7 crore on July 15 by the Reserve Bank of India for violation of several norms, ranging from bad loans classification (NPA or non-performing assets) to not following norms on reporting of fraud.
The move was based on inspection of the bank with reference to its financial position as on March 31, 2017, and came after a reply and an oral submission was received from the bank for RBI’s show cause notice.
The RBI said the fine on SBI was for non-compliance with its directions on Income Recognition and Asset Classification, on the opening of current accounts, reporting of data on Central Repository of Information on Large Credits, fraud risk management, and classification and reporting of frauds.
“This action is based on 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 RBI said.
The RBI has penalised banks in the last few years, slapping fines on the issue of bad loan classification and provisioning for the same.