Public sector lender Bank of Baroda on Tuesday said the South African Reserve Bank was investigating allegations regarding compliance lapses at the bank’s branch there and it is cooperating in the matter.
The bank was responding to clarifications sought by exchanges regarding a news report citing the bank’s involvement with a particular Indian origin family in South Africa extending to a political scandal there.
The news report referred to the bank’s dealings with one Gupta family, now settled in South Africa and follows information furnished by the bank to exchanges in August 2017 about paying Rs 54.5 million as penalty that was imposed on its South Africa branch by the local regulator.
It had also informed about paying Rs 4.23 million fine in Seychelles without giving details.
“As regards the news item, the Reserve Bank of South Africa is investigating the allegations against Bank of Baroda and the bank is actively cooperating and supporting these investigations,” the bank said in a regulatory filing to the exchanges.
Bank of Baroda has made all disclosures that are considered material under Regulation 30 of the Sebi (Listing Obligations and Disclosure Requirements) Regulations, 2015, it said.
The lender said some of the matters are sub-judice, including its appeal against a fine of an equivalent of Rs 50 million.
“Many of these allegations are on historical transactions and the bank has since then significantly improved the compliance process and these remediation measures would ensure that KYC/AML (Know Your Customer/Anti-Money Laundering) are completed to fullest satisfaction of internal review and to meet the expectations of various regulators,” it said.
Further, the bank said it would keep the stock exchanges updated about any significant outcome from these investigations.
Bank of Baroda’s stock closed 1.97 per cent down at Rs 154.40 on the BSE on Tuesday.