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| Reserve Bank of India imposes Rs 589 million penalty on ICICI Bank | | | Agencies
NEW DELHI: The Reserve Bank of India (RBI) has imposed a hefty penalty of Rs 589 million on ICICI Bank Limited (the bank) for non-compliance of directions issued with regard to the direct sale of securities from its HTM portfolio and specified disclosure in this regard. Through an order dated March 26, the Central Bank imposed the penalty taking into account the failure of the bank to adhere to its directions.
The RBI said that the action is based on the deficiencies in regulatory compliance. It added that the action "is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers." The central bank in its notification has not elaborated on how ICICI Bank failed to comply with its norms.
Banks need to disclose the amount of securities they keep under the HTM segment under which the papers are held until maturity and cannot be used for intraday trading. The RBI allows banks to sell securities from HTM subject to certain limits and disclosure rules.
Here is the full text of the RBI notification
The Reserve Bank of India (RBI) has imposed through an order dated March 26, 2018, a monetary penalty of Rs 589 million on ICICI Bank Limited (the bank) for non-compliance with directions issued by RBI on direct sale of securities from its HTM portfolio and specified disclosure in this regard. This penalty has been imposed in exercise of powers vested in RBI under the provisions of Section 47A(1)(c) read with Section 46(4)(i) of the Banking Regulation Act, 1949, taking into account failure of the bank to adhere to the aforesaid directions/guidelines issued by RBI. This action is based on the deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers. |
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