Reserve Bank of India imposes monetary penalty on SBM Bank (India) Ltd.

Case Brief

By an order dated October 15, 2019, RBI imposed a monetary penalty of ₹3 crore on SBM Bank (India) Ltd. The penalty was for non-compliance with certain provisions of RBI directions on 'Time-bound implementation and strengthening of SWIFT-related operational controls' and 'Cyber Security Framework in Banks'. RBI stated that the deficiencies were found in the Indian operations of SBM Bank (Mauritius) Ltd., which later amalgamated with SBM Bank (India) Ltd., and that the bank's explanations did not displace the findings. The action was taken under Section 47A(1)(c) read with Section 46(4)(i) of the Banking Regulation Act, 1949, and RBI clarified that the penalty was based on regulatory compliance deficiencies and was not meant to pronounce on the validity of any transaction or agreement with customers.