| Company | Value | Change | %Change |
|---|
The RBI’s action, which was formalised through an order dated December 18, 2024, follows findings from the Statutory Inspection for Supervisory Evaluation (ISE 2023), conducted based on the bank’s financial position as of March 31, 2023.
The inspection revealed non-compliance with RBI regulations, leading the central bank to issue a show-cause notice to IndusInd Bank.
In its response to the notice, the bank made additional submissions, and a personal hearing was held. However, after careful consideration, the RBI sustained the charge of opening savings accounts for ineligible entities, prompting the monetary penalty.
Also read: Bank fraud value sees decline over 3 financial years: Here’s a sector-wise breakdown
The RBI clarified that the action was based solely on deficiencies in regulatory compliance and did not question the validity of any transactions or agreements made between the bank and its customers.
This penalty is in accordance with powers conferred on the RBI under Section 47A(1)(c) of the Banking Regulation Act, 1949. While the monetary penalty addresses the regulatory non-compliance, the RBI also emphasised that this penalty is without prejudice to any further actions that may be taken against IndusInd Bank in the future.
