The Reserve Bank has imposed a penalty of Rs 4 crore on Citibank for non-compliance with various regulatory norms and directions of the central bank.
In a release, RBI said the penalty has been imposed on Citibank NA for contravention of certain sections of the Banking Regulation Act and for non-compliance with directions.
The directions pertained to obtaining declaration from customers about credit facilities enjoyed with other banks, granting non-fund based facilities to non-constituent borrowers, verifying data available in CRILC database and obtaining NOC from lending banks at the time of opening current accounts, and submission of compliance to risk assessment findings.
RBI said the statutory inspection of the Indian operations of the bank with reference to its financial positions as on March 31, 2017 and March 31, 2018 and the Risk Assessment Reports (RARs) pertaining thereto revealed, inter-alia, contravention with the provisions of the Act and non-compliance with certain directions issued by the central bank, following which a notice was issued to Citibank.
"After considering the bank's reply to the notice, oral submissions made during the personal hearing and examination of additional submissions, RBI concluded that the aforesaid charges of contravention with the provisions of the Act and non-compliance with RBI directions warranted imposition of monetary penalty," it said.
The penalty has been imposed by an order dated January 8, 2020, it added.
The RBI has also imposed penalty on three co-operative banks for non-compliance with various directions issued by it.
A penalty of Rs 60 lakh has been imposed on Bharat Co-operative Bank (Mumbai) Limited for non-compliance with directions on income recognition and asset classification (IRAC) norms and frauds classification and reporting.
It said a penalty of Rs 40 lakh was imposed on Nagar Urban Co-operative Bank, Ahmednagar for violation of norms, including those on IRAC.
Also, Rs 45 lakh penalty has been slapped on TJSB Sahakari Bank Limited for non-compliance with directions on IRAC norms.
In all the cases, RBI said action was based on deficiencies in regulatory compliance and "is not intended" to pronounce upon the validity of any transaction or agreement entered into by them with customers.