RBI imposed a monetary penalty of ₹ 25 lakh on Axis Bank as it failed to comply with certain provisions of Know Your Customer (KYC) norms.
The Reserve Bank of India (RBI) today imposed a monetary penalty of ₹ 25 lakh on Axis Bank for violation of rules. The RBI, in an order dated September 1, held Axis Bank responsible for failing to comply with certain provisions of Know Your Customer (KYC) norms.
During February 2020 and March 2020, RBI carried out a scrutiny in a customer account maintained with the leading private bank. The banking regulator observed that Axis Bank did not comply with RBI – KYC Direction, 2016.
Axis Bank failed to monitor the ongoing due diligence in the particular account to ensure that the transactions were consistent with its knowledge about the customer, customer’s business, and risk profile, according to its statement.
Subsequently, RBI issued a notice to Axis Bank, asking why the penalty should not be imposed on it for the contravention of the directions.
After examining the response to the notice and the verbal submissions made during the personal hearing, the RBI said it “came to the conclusion that the charge of contravention of/non-compliance with the aforesaid RBI directions was substantiated” and then imposed the monetary penalty.
However, RBI added that the penalty is based upon the deficiencies in regulatory compliance and will not impact the validity of any transaction or agreement entered into by Axis Bank with its customers.
On Wednesday, September 1, shares of Axis Bank settled 1.54 per cent higher at ₹ 798.50 apiece on the BSE. Axis Bank opened on the BSE at ₹ 796, swinging to an intra day high of ₹ 819. and an intra day low of ₹ 795.95, throughout the trading session so far.
Source : https://www.ndtv.com/business/reserve-bank-of-india-rbi-imposes-penalty-of-rs-25-lakh-on-axis-bank-for-violation-of-norms-2526563#pfrom=home-business_topstories