Page 8 - Banking Finance January 2022

RBI CORNER

Reserve Bank

News

Penalty on UBI gree of protection for the depositors, 9.99 per cent of the paid-up equity
the RBI said. share capital, subject to compliance
The Reserve Bank of India has imposed
a monetary penalty of Rs.1 crore on In September 2019, the RBI had super- with the provisions of the 'Master Di-
Union Bank of India (UBI) for non-com- seded the board of PMC Bank and rection on Prior approval for acquisi-
pliance with certain provisions of its placed it under regulatory restrictions, tion of shares or voting rights in private
directions relating to fraud classifica- including cap on withdrawals by its sector banks dated November 19,
tion and reporting and sale of stressed customers, after detection of certain 2015', and 'Master Direction on Own-
assets. financial irregularities, hiding and ership in private sector banks dated
misreporting of loans given to real es- May 12, 2016', provisions of the appli-
The central bank, in a statement, said cable regulations issued by the Securi-
its inspection of UBI revealed, inter tate developer HDIL. The restrictions ties and Exchange Board of India and
alia, non-compliance with the above- have been extended several times Foreign Exchange Management Act,
mentioned directions to the extent of since then. 1999.
(i) failure to classify an account as Red USFB, promoted by Centrum Financial
Flag Account despite presence of Early Services along with Resilient Innova-
Warning Signals and (ii) failure to dis- tion Pvt Ltd as 'joint investor', was RBI gets 2,562 plaints
close ageing of and provisioning for granted banking licence in October against lending apps
Security Receipts (SRs) in its Annual 2021. USFB started functioning from The Reserve Bank of India (RBI) has
Report. November 1.
received 2,562 complaints against digi-
tal lending apps during the 15-month
RBI comes up with draft RBI clears LIC stake hike in period ended March 2021.
planfor PMC Bank take- Kotak Mahindra Bank "Complaints against DLAs - Sachet, a
over Life Insurance Corporation of India has portal established by the Reserve Bank
got approval from the Reserve Bank of under State Level Coordination Com-
Inching closer to resolving the Punjab
and Maharashtra Cooperative (PMC) India to increase its stake in Kotak mittee (SLCC) mechanism for register-
Mahindra Bank to 9.99 per cent. ing complaints by public, has been re-
Bank issue, the Reserve Bank came out
with a draft scheme for takeover of the LIC currently holds 4.96 per cent stake ceiving significantly increasing number
crisis-hit bank by the Delhi-based Unity in the bank as of September 30, 2021. of complaints against digital lending
Small Finance Bank (USFB). Kotak Mahindra Bank, in a stock ex- apps," the RBI's Working Group on digi-
The draft scheme of amalgamation change filing, said it has received an tal lending said in a report.
envisages takeover of the assets and intimation from LIC stating that the "Majority of the complaints pertain to
liabilities of PMC Bank, including depos- RBI had granted its approval for in- lending apps promoted by entities not
its, by USFB, thus giving a greater de- creasing its holding in the Bank up to regulated by the Reserve Bank such as

8 | 2022 | JANUARY | BANKING FINANCE