Latest news with #REs
Time of India
3 days ago
- Business
- Time of India
RBI Penalties: RBI Imposes Rs 54.78 Crore in Penalties on 353 Banks and Financial Entities in FY25, ET LegalWorld
The Reserve Bank took enforcement action against regulated entities (REs) and imposed 353 penalties aggregating to Rs 54.78 crore in the fiscal ending March 31, 2025 for contraventions with provisions of statutes. The contraventions/non-compliance were related to cyber security framework in banks; exposure norms and IRAC norms; know your customer directions; frauds classification and reporting directions; reporting information on CRILC; and submission of credit information to credit information companies (CICs). "During 2024-25, the Department undertook enforcement action against REs and imposed 353 penalties aggregating to Rs 54.78 crore for contraventions/non-compliance with provisions of statutes and certain directions issued by the Reserve Bank from time to time," according to the RBI's Annual Report for the Year 2024-25 released on Thursday. Advt RBI data showed that as many as 264 penalties amounting to Rs 15.63 crore were imposed on cooperative the RBI imposed penalties on 37 non-banking financial companies/asset reconstruction companies totalling Rs 7.29 crore and 13 housing finance companies (Rs 83 lakh).During the last fiscal, penalties aggregating to Rs 11.11 crore were imposed on eight public sector banks and Rs 14.8 crore on 15 private many as six foreign banks too were penalised. Join the community of 2M+ industry professionals Subscribe to our newsletter to get latest insights & analysis. Download ETLegalWorld App Get Realtime updates Save your favourite articles Scan to download App
Time of India
3 days ago
- Business
- Time of India
RBI imposes ₹54.78 crore in penalties on 353 banks, other regulated entities during FY25
The Reserve Bank of India ( RBI ) imposed penalties totalling ₹54.78 crore on 353 regulated entities (REs) during the financial year 2024–25 for various contraventions of statutory provisions and regulatory directions, the central bank said in its annual report released on Thursday. The enforcement actions were taken against banks, non-banking financial companies (NBFCs), asset reconstruction companies (ARCs), housing finance companies, and cooperative banks for non-compliance in areas including cyber security, exposure norms, income recognition and asset classification (IRAC), Know Your Customer (KYC) guidelines, fraud classification and reporting, submission of data to the Central Repository of Information on Large Credits (CRILC), and credit information reporting to credit information companies (CICs). Also Read: RBI may introduce bank-like rate norms for NBFCs to plug policy gaps Play Video Pause Skip Backward Skip Forward Unmute Current Time 0:00 / Duration 0:00 Loaded : 0% 0:00 Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 1x Playback Rate Chapters Chapters Descriptions descriptions off , selected Captions captions settings , opens captions settings dialog captions off , selected Audio Track default , selected Picture-in-Picture Fullscreen This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Opacity Opaque Semi-Transparent Text Background Color Black White Red Green Blue Yellow Magenta Cyan Opacity Opaque Semi-Transparent Transparent Caption Area Background Color Black White Red Green Blue Yellow Magenta Cyan Opacity Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Drop shadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Camarotes de crucero sin vender (Eche un vistazo a los precios) GoSearches | Search Ads Undo 'During 2024-25, the Department undertook enforcement action against REs and imposed 353 penalties aggregating to ₹54.78 crore for contraventions/non-compliance with provisions of statutes and certain directions issued by the Reserve Bank from time to time,' the RBI said in its Annual Report for 2024–25. According to the data, cooperative banks were the most penalised category, with 264 penalties amounting to ₹15.63 crore. The central bank also took action against 37 NBFCs and ARCs, imposing penalties totalling ₹7.29 crore. Live Events Additionally, 13 housing finance companies were fined a combined ₹83 lakh. Among commercial banks, eight public sector banks faced penalties totaling ₹11.11 crore, while 15 private sector banks were fined ₹14.8 crore. The RBI also penalised six foreign banks during the fiscal year . With inputs from PTI
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Business Standard
3 days ago
- Business
- Business Standard
RBI imposed penalties on 353 banks, other regulated entities in FY25
The Reserve Bank took enforcement action against regulated entities (REs) and imposed 353 penalties aggregating to ₹54.78 crore in the fiscal ending March 31, 2025 for contraventions with provisions of statutes. The contraventions/non-compliance were related to cyber security framework in banks; exposure norms and IRAC norms; know your customer directions; frauds classification and reporting directions; reporting information on CRILC; and submission of credit information to credit information companies (CICs). "During 2024-25, the Department undertook enforcement action against REs and imposed 353 penalties aggregating to Rs 54.78 crore for contraventions/non-compliance with provisions of statutes and certain directions issued by the Reserve Bank from time to time," according to the RBI's Annual Report for the Year 2024-25 released on Thursday.
Time of India
6 days ago
- Business
- Time of India
RBI to formalise expected credit loss framework, project finance and issues guidelines to curb mis-selling of financial products
MUMBAI: RBI will formalise the expected credit loss (ECL) framework for banks and issue guidelines to curb mis-selling of financial products by regulated entities (REs), including third-party offerings. These reforms, highlighted in its annual report, are part of RBI's broader effort to enhance financial sector resilience amid growing risks from technology, cyber threats, and climate change. The ECL framework marks a shift from the current incurred loss model to a forward-looking approach, aligning Indian banks with global norms. This transition, long in the works, is expected to improve credit risk recognition and provisioning discipline, potentially increasing short-term provisioning but making bank balance sheets more shock-absorbent over time. RBI conducted impact studies in phases since 2022 to assess readiness and calibrate implementation. Also on the cards is the implementation of new project finance guidelines, which were proposed earlier but were deferred from being implemented in FY25 by the new governor Sanjay Malhotra after he took charge. The reforms proposed in the last fiscal include increasing provisions on delayed projects by as much as 5% The planned mis-selling guidelines follow rising concerns over aggressive sales practices, particularly the cross-selling of insurance and investment products often to senior citizens to whom these products are not suited. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like 2025: Steel Suppliers From Mexico At Lowest Prices (Take A Look) Steel Suppliers | search ads Search Now Undo The new rules will hold REs accountable not just for their own products but also for those sold through third-party tie-ups, with stricter conduct norms and disclosure standards. The department of regulation will also issue final norms for co-lending arrangements, revise securitisation guidelines for stressed assets, and release updated rules on income recognition and asset classification. As part of its Basel III rollout, RBI will issue credit risk norms, finalise market risk guidelines, and update disclosure requirements. Climate-related risks remain a key focus. RBI will publish disclosure norms, launch a climate risk data system, and issue supervisory principles. It will also review the green deposits framework and issue norms for sustainability-linked loans. Other planned reforms include revising internet and mobile banking regulations, setting differentiated norms for Type I NBFCs, and digitising regulatory processes through the new Regulatory Application Management System (RAMS). A consolidation of existing circulars into thematic master directions is also underway. The department of supervision will strengthen liquidity stress testing, tighten oversight of payment and small finance banks, and improve monitoring of digital infrastructure uptime. For urban cooperative banks and NBFCs, RBI will consider migrating them to risk-based supervision and review AML practices. A thematic review will examine whether NBFCs are adhering to interest rate caps set by RBI. RBI's fintech arm will expand central bank digital currency pilots, add B2C features to the unified lending interface, and upgrade its fraud detection tool It will also frame standards for the ethical use of AI in finance. Consumer protection will be reinforced through an overhaul of the ombudsman scheme and issuance of a new grievance redress framework. RBI will also upgrade its complaint handling system. The financial stability department will develop liquidity stress tools for NBFCs, extend stress testing to cooperative banks, and model climate transition risks in carbon-heavy sectors. It will also build a growth-at-risk model to assess future economic vulnerabilities. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Mint
20-05-2025
- Business
- Mint
Bank, NBFC investments in AIFs may get smoother
Banks, non-bank lenders and financial institutions may get to invest up to 10% in the corpus of alternate investment fund (AIF) schemes, in a relief for the sector that faced a central bank clampdown in December, 2023. There will be no restriction on regulated entities (REs) such as banks for investing up to 5% in the AIF scheme's corpus, Reserve Bank of India (RBI) proposed on Monday. However, if the AIF scheme invests in a company that has borrowed from the bank, then the RE must make full provision to the extent of its proportionate exposure, the draft circular said. Again, total investments by all REs in any AIF scheme will be capped at 15% of the scheme corpus. 'Notwithstanding, if the RE's contribution is in the form of subordinated units under the priority distribution model (PDM), it shall deduct the entire investment from its capital funds— equally from both Tier-1 and Tier-2 capital (wherever applicable)," RBI said. Also read: Bank of Baroda's margin pressure to continue before easing in FY26 second half The new directions will apply only to future investments. Investments and commitments made already will continue to be governed by current norms. Further, RBI, in consultation with the government, may exempt certain AIFs that have been set up for strategic purposes. The central bank has sought comments and feedback on the new draft norms by 8 June. 'The RBI's updated guidelines on bank investments in AIFs reflect a mature policy shift. They balance prudential risk management with the broader developmental objective of banks," said Gopal Srinivasan, chairman and managing director of TVS Capital Funds, adding the move will help restore regulatory clarity for such investments. Need for revised norms RBI said the draft was issued following the guidelines issued by the Securities and Exchange Board of India on 8 October, 2024 requiring specific due diligence with respect to investors and AIF investments. RBI said the new norms will help 'prevent facilitation of circumvention of regulatory frameworks" by ensuring uniform guidelines across regulators. Also read: SBI shares fall as lender tempers loan growth target amid tariff uncertainty The Sebi circular, while highlighting concerns of RBI-regulated lenders using AIFs to evergreen stressed loans, introduced stricter due diligence requirements for AIFs, their managers and key management personnel. The objective was to prevent circumvention of regulations, tighten oversight over such funds and prevent ineligible investors from accessing benefits meant for qualified institutional buyers (QIBs) and qualified buyers (QBs). AIFs were also required to perform due diligence if 25% or more of the scheme's corpus was contributed by RBI-regulated investors or if they exerted significant influence over investment decisions. 'Taking into account the more robust and comprehensive structure provided under the Sebi guidelines, there was a scope and need for bringing in some relaxations," said Jyoti Prakash Gadia, managing director at Resurgent India, a category-1 merchant bank. 'Since an approach of discipline has been exhibited by the regulated entities subsequent to the previous guidelines, the partial relaxations are expected to bring in better utilization of the alternate investment funds," he added. Background On 19 December, 2023, RBI asked lenders not to invest in AIFs that have direct or indirect downstream investments in companies that were borrowers in the last 12 months. Further, such existing investments were required to be liquidated or fully provided for in 30 days. This prompted several large private banks to make significant provisions against these investments in their financials for the last two quarters of FY24. In March 2024, the regulator clarified that these investments would exclude equity shares, compulsorily convertible preference shares and compulsorily convertible debentures. It had then also said that the provisioning will be required only to the extent of investment by the RE in the AIF scheme which is further invested by the AIF in the debtor company, and not on the entire investment of the RE in the AIF scheme. These guidelines were stipulated with the objective of preventing instances of evergreening by utilization of the AIF route to repay existing potential distressed loans. In Monday's circular, RBI said that the regulatory measures have brought 'financial discipline among the REs regarding their investment in AIFs". Siddarth Pai, co-founder and managing partner, 3one4 Capital said the new guidelines are significant to rupee capital formation as banks and NBFCs are important institutional investors in AIFs, but were placed under restrictions due to certain regulatory findings. Also read: Microfinance stress, RBI embargo weighed on Kotak Bank's Q4 profitability 'The Indian AIF industry is around ₹13.5 trillion in capital commitments as of 31 March, 2025. The aim is to reach at least ₹30 trillion by 2030. For this, the simplification of regulation and the removal of artificial regulatory barriers to investing in alternatives is key," he said. (With inputs by Sneha Shah)
