The Reserve Bank has imposed a penalty of Rs 10 crore on HDFC Bank for deficiencies in regulatory compliances with regard to its auto mortgage portfolio.
The penalty has been slapped after analyzing a grievance by a whistleblower relating to irregularities within the auto mortgage portfolio of the lender. The order imposing the fantastic was issued on May 27.
In a press release on Friday, the Reserve Bank of India (RBI) mentioned it has imposed a financial penalty of Rs 10 crore on HDFC Bank for contraventions of sure provisions of the Banking Regulation Act, 1949.
The apex financial institution mentioned an examination of paperwork within the matter of selling and sale of third-party non-financial merchandise to the financial institution’s prospects, arising from a whistleblower grievance to it relating to irregularities within the auto mortgage portfolio of the financial institution, revealed contravention of the provisions of the Act and the regulatory instructions.
In furtherance to the identical, RBI mentioned a discover was issued to the financial institution advising it to indicate trigger as to why penalty shouldn’t be imposed for the contraventions.
After contemplating the financial institution’s reply to the present trigger discover, oral submissions made throughout the private listening to and examination of additional clarifications/ paperwork furnished by the financial institution, RBI got here to the conclusion that the contraventions have been “substantiated and warranted imposition of monetary penalty”, the assertion mentioned.
RBI additionally made it clear that the motion is predicated on deficiencies in regulatory compliance and isn’t meant to pronounce upon the validity of any transaction or settlement entered into by HDFC Bank with its prospects.
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