RBI Penalizes IDFC First Bank and LIC Housing Finance
08 Apr 2024
2 Min Read
CW Team
The Reserve Bank of India (RBI) announced that it has taken stringent actions against IDFC First Bank and LIC Housing Finance for violations of regulatory norms. A penalty of Rs 1 crore has been imposed on IDFC First Bank, while LIC Housing Finance faces a penalty of Rs 49.70 lakh.
The penalty on IDFC First Bank was levied for non-compliance with specific directions related to 'Loans and Advances - Statutory and Other Restrictions', as stated by the central bank in a released statement. Similarly, LIC Housing Finance incurred penalties for non-compliance with certain provisions of the 'Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021'.
It's important to note that these penalties are based on identified deficiencies in regulatory compliance and do not reflect upon the validity of any transactions or agreements entered into by the banks with their customers.
In addition to the penalties imposed, the RBI has also announced the cancellation of the certificate of registration (CoR) of four Non-Banking Financial Companies (NBFCs): Kundles Motor Finance, Nithya Finance, Bhatia Hire Purchase, and Jiwanjyoti Deposits and Advances. Consequently, these entities are no longer authorized to conduct business as non-banking financial institutions.
Furthermore, five NBFCs have voluntarily surrendered their CoRs. These include Growing Opportunity Finance (India), Invel Commercial, Mohan Finance, Saraswati Properties, and Quicker Marketing.
The RBI's actions underscore its commitment to maintaining strict regulatory standards within the financial sector, ensuring the integrity and stability of the banking and non-banking segments.
The Reserve Bank of India (RBI) announced that it has taken stringent actions against IDFC First Bank and LIC Housing Finance for violations of regulatory norms. A penalty of Rs 1 crore has been imposed on IDFC First Bank, while LIC Housing Finance faces a penalty of Rs 49.70 lakh.
The penalty on IDFC First Bank was levied for non-compliance with specific directions related to 'Loans and Advances - Statutory and Other Restrictions', as stated by the central bank in a released statement. Similarly, LIC Housing Finance incurred penalties for non-compliance with certain provisions of the 'Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021'.
It's important to note that these penalties are based on identified deficiencies in regulatory compliance and do not reflect upon the validity of any transactions or agreements entered into by the banks with their customers.
In addition to the penalties imposed, the RBI has also announced the cancellation of the certificate of registration (CoR) of four Non-Banking Financial Companies (NBFCs): Kundles Motor Finance, Nithya Finance, Bhatia Hire Purchase, and Jiwanjyoti Deposits and Advances. Consequently, these entities are no longer authorized to conduct business as non-banking financial institutions.
Furthermore, five NBFCs have voluntarily surrendered their CoRs. These include Growing Opportunity Finance (India), Invel Commercial, Mohan Finance, Saraswati Properties, and Quicker Marketing.
The RBI's actions underscore its commitment to maintaining strict regulatory standards within the financial sector, ensuring the integrity and stability of the banking and non-banking segments.
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