RBI: On July 5, the Reserve Bank of India (RBI) announced that Punjab National Bank has been fined Rs 1.32 crore for breaking regulations. The RBI stated in a release that the financial penalty was levied because two State Government-owned Corporations received working capital demand loans from banks against monies owed to them by the government in the form of subsidies, refunds, and reimbursements.
Neglect in Maintaining Client Data
The announcement also stated that the lender had neglected to keep data about the addresses and identities of clients that were acquired throughout the course of business dealings with respect to specific accounts.
After conducting a Statutory Inspection for Supervisory Evaluation (ISE 2022) of the bank to determine its financial position as of March 31, 2022, the central bank issued a notice to the bank advising it to provide justification for why a penalty should not be imposed. This was based on supervisory findings of non-compliance with RBI directions and related correspondence.
RBI’s Statutory Inspection and Supervisory Evaluation
In addition, according to the Reserve Bank, the public sector lender neglected to save data pertaining to the names and addresses of clients that were acquired during business dealings in a few of this bank’s accounts. The penalties, according to the central bank, is based on regulatory compliance violations and isn’t meant to affect the legality of any agreements or transactions the bank enters into with its clients.