The bank was fined for non-compliance with RBI's directions on KYC norms, anti-money laundering standards and opening of current accounts.
Andhra Bank share price shed over 3 percent intraday on December 6 after the Reserve Bank of India (RBI) imposed a penalty of Rs 25 lakh.
Andhra Bank was fined for failing to comply with RBI’s directions on know your customer (KYC) norms, anti-money laundering standards and opening of current accounts. The bank has already taken necessary preventive measures, the state lender said in a filing to the exchanges.
"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 their customers," the RBI said.
"After considering the reply received from the bank and submissions made during the personal hearing, the RBI came to the conclusion that the aforesaid charges of non-compliance with the RBI directions were sustained and warranted imposition of monetary penalty."