RBI imposes monetary penalty on Mumbai-based India Home Loan

RBI imposes penalty on two entities for rule violations

The Reserve Bank of India (RBI) has imposed a monetary penalty of Rs 1 lakh on India Home Loan Limited for non-compliance with certain rules.

The statutory inspection of the company was conducted by National Housing Bank (NHB) with reference to its financial position as on March 31, 2022.

Based on supervisory findings of non-compliance with NHB, RBI directions and related correspondence in that regard, a notice was issued to the company advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the said directions, the RBI said in a statement.

After considering the company’s reply, the RBI found that the charge of sanctioning loans beyond the prescribed Loan to Value (LTV) Ratio was sustained, warranting imposition of monetary penalty, RBI said.

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 company with its customers, RBI said.

In a separate release, the RBI said it has imposed penalty on three cooperative banks as well.

The central bank imposed Rs one lakh monetary penalty on The Angul United Central Co-operative Bank Ltd, Odisha for non-compliance with KYC norms.

In this case, the statutory inspection of the bank was conducted by National Bank for Agriculture and Rural Development (NABARD) with reference to its financial position as on March 31, 2023, RBI said.

Based on supervisory findings of non-compliance with RBI directions and related correspondence in that regard, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the said direction, RBI said.

After considering the bank’s reply to the notice, RBI found that the bank failed to implement a system of risk-based approach for undertaking periodic updation of KYC, warranting imposition of monetary penalty, the central bank said.

Also, the RBI imposed monetary penalty on Andhra Pradesh's The Prakasam District Co-operative Central Bank Ltd and Karnataka's Vishwakalyan Sahakara Bank Niyamit for rule violations.