RBI imposes monetary penalty on DCB Bank, Tamilnad Mercantile Bank for rule violations

The Reserve Bank of India (RBI) on March 19 said it has imposed monetary penalty on DCB Bank and Tamilnad Mercantile Bank for rule violations.

The central bank imposed Rs 63.60 lakh penalty on DCB Bank and Rs 1.32 crore on Tamilnad Mercantile Bank, said a release from the central bank.

Tamilnad Mercantile Bank was penalised as it failed to benchmark the interest rate on certain floating rate loans to MSMEs to an external benchmark lending rate and adopted multiple benchmarks within the same loan category, the RBI said.

Further, the bank also failed to price certain floating rate loans with reference to actual benchmark rate applicable to those loans and wrongly reported external rating of certain borrowers to CRILC, the RBI added.