Reserve Bank of India imposes monetary penalty on Karur Vysya Bank Limited

Case Brief

The Reserve Bank of India imposed a monetary penalty of ₹50 million on Karur Vysya Bank Limited by order dated September 25, 2018. The penalty was levied under Section 47A(1)(c) read with Section 46(4)(i) of the Banking Regulation Act, 1949, for non-compliance with RBI directions on Income Recognition and Asset Classification (IRAC) norms, reporting of frauds, and discipline at the time of opening current accounts. RBI clarified that the action was based on regulatory deficiencies and was not meant to comment on the validity of any transaction or agreement entered into by the bank with its customers.