Case Brief
By an order dated June 01, 2022, RBI imposed a monetary penalty of ₹27.50 lakh on Punjab & Sind Bank. The penalty was for non-compliance with RBI directions on external benchmark based lending: the bank had linked certain floating-rate retail loans and floating-rate MSME loans, extended on or after October 01, 2019, to MCLR instead of an external benchmark. RBI issued a show-cause notice, considered the bank’s reply and oral submissions, and then concluded the violation was substantiated under the Banking Regulation Act, 1949.
Action Snapshot
- Primary Impact
- Fine: Rs 27.5 L
- Entity Type
- Bank
- Action Type
- Monetary penalty