The RBI has penalized two of Indian well-known banks SBI and Union Bank for violating some rules. On Monday, the central bank fines Rs 7 Crore on SBI and Rs 10 Lakh on Union Bank for non-compliance with directions issued by RBI.

SBI has been fined for non-compliance with rules issued by the RBI on income recognition and asset classification norms (IRAC). These are rules that come into play when a loan should be declared as a non-performing asset (NPA). After a loan becomes NPA, the RBI wants that any recovery should not be classified as income.

Banks are required to share all the information they have regarding large borrowers with the RBI only. SBI’s penalty is also for reporting data and sharing of information about customers with other banks, reporting of data on CRILC, fraud risk management, and classification and reporting of frauds.

Based on the inspection report and other relevant documents, a notice was issued to SBI to show why penalty should not be imposed. “

After considering the bank’s reply and oral submissions made in the personal hearing, RBI came to the conclusion that the aforesaid charges of non-compliance with RBI directions were substantiated and warranted imposition of monetary penalty,

” the RBI said.

Also, RBI imposed the Rs 10 lakh fine on Union Bank of India for failing in cybersecurity in 2016, which resulted in an attempted online robbery of $171 million using the bank’s Swift messaging systems.

In a statement issued, RBI said that the penalty was for non-compliance with the directions on cybersecurity framework in banks issued by the RBI.

Also Read: Here’s How India Has Lost Rs 71,500 Crore With These 5 Bank Frauds