RBI imposes fine of Rs 1 crore on ICICI Bank, Rs 91 lakhs on Yes Bank for failure to comply

ICICI Bank has been fined Rs1 crore by the Reserve Bank of India for not following certain guidelines regarding 'Loans and Advances – Statutory and Other Restrictions'.

During the financial year 2022 inspection, the central bank found that ICICI Bank had provided term loans to specific entities in place of budgetary funds designated for particular projects.

Nevertheless, ICICI Bank failed to properly assess the viability and long-term success of these projects to guarantee that the generated income would be sufficient to meet the debt repayment requirements.

Moreover, the loans were repaid using budget funds without verifying if the money was designated for projects that could be monitored.
Similarly, the RBI also imposed a fine of ₹91 lacs on Yes Bank on May 17 for violating rules related to 'Customer Service in Banks' and 'Un-Authorised Operation of Internal/Office Accounts'.

During the fiscal year 2022, Yes Bank was found to have levied penalties on accounts with low or no balance and had created and used internal accounts in customers' names without permission for activities like holding funds and managing transactions.