NEW DELHI: Banking regulator Reserve Bank of India (RBI) has imposed monetary penalties on ICICI Bank and Kotak Mahindra Bank for non-compliance of banking regulations. The monetary penalty imposed on ICICI Bank is Rs 12.19 crore, while that on Kotak Mahindra Bank is Rs 3.95 crore.
In the case of ICICI Bank, the statutory inspections for supervisory evaluation by the RBI found that the bank had sanctioned loans to companies in which two of its directors were also directors. The bank was also found to be marketing and engaging in the sale of non-financial products. In some cases, the bank also failed to report frauds to RBI within the prescribed timelines.
In case of Kotak Mahindra Bank, the central bank found that it levied foreclosure charges despite there being no clause in the loan agreement for levy of prepayment penalty on loans recalled/foreclosure initiated by the bank. In some instances, it charged interest from disbursement due date instead of the actual date of disbursement, contrary to the terms & conditions of sanction.
The Reserve Bank of also found that the bank was contacting customers after 7 pm and before 7 am. The bank also failed to carry out annual review / due diligence of the service provider. The regulator in a statement said that after considering the banks’ reply to the notice, oral submissions made during the personal hearing and additional submissions made by it, it came to the conclusion that the charge of non-compliance with the provisions of the BR Act and the Reserve Bank of India directions was substantiated and warranted imposition of monetary penalty on the bank.