RBI Imposes Rs 2.20 Crore Penalty on Indian Overseas Bank for Rule Violations

RBI Imposes Rs 2.20 Crore Penalty on Indian Overseas Bank for Rule Violations

Daily Current Affairs   /   RBI Imposes Rs 2.20 Crore Penalty on Indian Overseas Bank for Rule Violations

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Category : Business and economics Published on: June 07 2023

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  • The Reserve Bank of India (RBI) has announced that it has imposed a monetary penalty of Rs 2.20 crore on Indian Overseas Bank (IOB) for various rule violations. 
  • The penalty was imposed because the bank failed to transfer the mandatory minimum amount of 25 percent of its disclosed profit for the year 2020-21 to its reserve fund.
  • This penalty has been imposed in exercise of powers vested in RBI under the provisions of section 47 A (1) (c) read with sections 46 (4) (i) and 51 (1) of the Banking Regulation Act, 1949.
  • The RBI also found that the bank offered interest rates on deposits of non-individual customers that were applicable to senior/super senior citizens in certain cases. 
  • Furthermore, the bank did not implement control measures for ATMs regarding the encryption of communication between the ATM terminal/PC and the ATM Switch within the prescribed timelines.
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