RBI imposes 2 crore fine on RBL Bank, know what is the matter

RBL Bank Penalized: The Reserve Bank of India (RBI) on Monday imposed a monetary penalty of Rs 2 crore on RBL Bank Ltd for violating deposit, board composition norms. RBI said, “This action is based on deficiencies in regulatory compliance and is not intended to adjudicate on the validity of any transaction or agreement entered into by the bank with its customers.

“In addition, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed for non-compliance/contravention of the directions/provisions of the Act,” RBI said.

After considering the bank’s reply to the show cause notice, the oral submissions made during the personal hearing and examination of the additional submissions made by the bank, RBI came to the conclusion that there was a violation/non-compliance with the instructions/Act on the bank. The above charges confirm the imposition of monetary penalty.

Recently, 99.94 per cent shareholders of RBL Bank approved the reappointment of Vishwavir Ahuja as Managing Director and Chief Executive for the fourth term starting June this year. Ahuja joined the bank in 2010 from Bank of America. He was behind the successful listing of the lender in August 2016 and multiplied its balance sheet.

Though the board in January this year approved his fourth three-year term till June 2024, in June the Reserve Bank approved his reappointment for only one year starting from June 2021.

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