Breaking: RBI imposes Rs 1 crore fine on State Bank of India

Breaking: RBI imposes Rs 1 crore fine on State Bank of India The Reserve Bank of India (RBI) levied a monetary penalty of Rs. 1.00 crore (Rupees One Crore Only) on State Bank of India (SBI) for violating sub-section (2) of Section 19 of the Banking Regulation Act, 1949, in an order dated November 16, 2021. (the Act). This penalty was issued in accordance with RBI's powers under section 47 A (1) (c) of the Act, as well as sections 46 (4) I and 51 (1) of the Act. This action is based on regulatory compliance issues and is not meant to be a judgement on the legitimacy of any transaction or agreement between the bank and its customers. RBI conducted Statutory Inspections for Supervisory Evaluation (ISE) of the bank with reference to its financial positions as of March 31, 2018 and March 31, 2019, and the examination of the Risk Assessment Reports, Inspection Reports, and all related correspondence pertaining to the same revealed, inter alia, a contravention of sub-section (2) of section 19 of the Act to the extent the bank held shares in borrower companies, as pledgee, of an amount exceeding thirtie million dollars. A notice was sent to the bank in this regard, urging it to show cause why a penalty should not be imposed on it for violating the aforementioned provisions of the Act, as specified therein. RBI concluded that the charge of contravention of the aforesaid provisions of the Act was substantiated and warranted imposition of monetary penalty on the bank, to the extent of contravention of the aforesaid provisions of the Act, after considering the bank's reply to the notice, oral submissions made during the personal hearing, and additional submissions made by the bank.