Recorded RBI impact
Fine: Rs 36.0 L
Monetary penalty · Fresh imposition
Published by RBI
9 Sept 2022
Case Brief
RBI, by order dated September 07, 2022, imposed a monetary penalty of ₹36 lakh on Industrial Bank of Korea for non-compliance with certain provisions of the RBI – KYC Direction, 2016. The violation arose from deficiencies found during statutory inspection, including failure to put in place a system for periodic review of risk categorization of accounts. RBI said the penalty was imposed under the Banking Regulation Act after considering the bank’s reply and oral submissions.
Why RBI Acted
RBI imposed a monetary penalty under section 47A(1)(c) read with section 46(4)(i) of the Banking Regulation Act, 1949, after a statutory inspection and review of the Risk Assessment Report showed that Industrial Bank of Korea had not established a system for periodic review of risk categorization of accounts, amounting to non-compliance with the RBI KYC Direction, 2016.
Operating Impact
Industrial Bank of Korea must absorb the monetary penalty; the release does not describe any operational restriction or suspension. The forward-looking impact is limited to the fine and the compliance signal regarding KYC/risk categorization controls.
Regulatory Basis
- section 47 A (1) (c) read with section 46 (4) (i) of the Banking Regulation Act, 1949
- Reserve Bank of India – (Know Your Customer (KYC)) Direction, 2016
Action Facts
- Primary Impact
- Fine: Rs 36.0 L
- Order Date
- 7 Sept 2022
- Effective From
- 7 Sept 2022
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Bank