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

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.