RBI fines SBI and Jana Small Finance Bank for regulatory violation
Banking and Finance
5 min read
Banking sector regulator the Reserve Bank of India (RBI) has fined India's largest bank, State Bank of India, Rs One Crore Seventy Two Lakh Eight Thousand and on Jana Small Finance Bank Rs One crore for violation of various regulatory provisions.
The Banking Regulation Act 1949 makes the RBI the regulator and supervisor of the Banking sector. During the periodic inspection of the bank’s accounts, RBI found that these banks violated its various regulatory guidelines and directives and hence imposed monetary fines on these banks.
Monetary Penalty on SBI
India’s largest commercial and public sector bank, SBI, was fined Rs One Crore Seventy Two Lakh Eight Thousand by the RBI.
According to the RBI, the SBI was found guilty of the following violations:
- Extending a bridge loan to a company against amounts receivable from the government in the form of subsidy/reimbursement;
- The bank failed to credit the amount in the customer's account due to unauthorised translation within 10 working days after the customer informed the bank.
- Failure of the bank to compensate the customer within 90 days from the date of receipt of the complaint;
- Opening /maintenance of current accounts in violation of RBI guidelines.
Monetary Penalty on Jana Small Finance Bank
- RBI imposed a monetary penalty of Rs. One crore on Jana Small Finance Bank.
- The bank was found guilty of raising its paid-up share capital through the issue/allotment of Compulsory Convertible Preference Shares (CCPS) to certain persons in violation of RBI’s guidelines.
About the State Bank of India
The origin of SBI can be traced to the establishment of the Bank of Calcutta in 1896, which was renamed the Bank of Bengal in 1806.
The Bank of Bengal was merged with the Bank of Bombay (established in 1840) and the Bank of Madras(established in 1843) in 1921, and the Imperial Bank of India was formed.
In 1955, the bank was nationalised and renamed the State Bank of India under the State Bank of India Act of 1955.
The government of India owns it.
It is the largest bank in India in terms of assets, profit, branches, ATMS, and foreign branches.
Headquarters: Mumbai, Maharashtra
Chairman: Challa Sreenivasulu Setty
Tagline: Pure Banking Nothing Else, Bankers of Every Indian,
Jana Small Finance Bank Limited
Jana Small Finance Bank Limited was a micro-financial institution. It got a license from the RBI and commenced operations as a Small Finance Bank in March 2018.
It is the fourth-largest Small Finance Bank in india
MD and CEO: Ajay Kaul
Headquarters: Bengaluru, Karnataka
Tagline: Likho Apni Kahani
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RBI fines Bank of Maharashtra, IDBI Bank, BOB, Axis Bank & ICICI Bank
