The Reserve Bank of India (RBI) has imposed a penalty of Rs 2.20 crore on the Indian Overseas Bank (IOB), a government-owned bank.
The penalty has been levied due to the bank’s violation of certain directions issued by the RBI, specifically related to prudential norms on income recognition, asset classification, and provisions concerning advances.
The RBI clarified that the penalty is a result of the bank’s failure to comply with regulatory requirements and does not question the validity of any transactions or agreements made by the bank with its customers.
The RBI conducted a statutory inspection, known as ISE 2021, to assess the bank’s financial position as of March 31, 2021.
One of the key deficiencies identified was the bank’s failure to transfer a minimum amount equal to 25 percent of its declared profit for the fiscal year 2020-21 to its reserves.
Stock Performance: On Friday, the final trading day of the week, the share price of the Indian Overseas Bank closed at Rs 25.38, reflecting a 1.36% increase compared to the previous day. The bank’s market capitalization stands at Rs 47,974.32 crore.
