RBI imposes fine on Lakshmi Vilas Bank, Syndicate Bank for violating norms

The Reserve Bank has imposed a monetary penalty of Rs 1 crore on Lakshmi Vilas Bank and Rs 75 lakh on Syndicate Bank for violating asset classification and fraud detection norms.

"The Reserve Bank of India (RBI) has, by an order dated October 14, 2019, imposed monetary penalty of Rs 1 crore on Lakshmi Vilas Bank Ltd for non-compliance with certain provisions of directions issued by RBI on 'Income Recognition and Asset Classification (IRAC) norms," RBI said in a release on Monday.

In a similarly worded release, it said a monetary penalty of Rs 75 lakh has been imposed on Syndicate Bank for non-compliance with the directions issued by RBI on frauds classification and reporting; innovative housing loan products wherein upfront disbursal of loans is done.

This action is based on the deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers, RBI said for the banks.