The Reserve Bank of India (RBI) has imposed significant fines on the India branch of Bangladesh's Sonali Bank Plc and the Central Bank of India for violations of transaction norms. According to a report by the Hindustan Times, these penalties stem from breaches of loan, advance, and Know Your Customer (KYC) regulations.

The RBI fined Sonali Bank PLC of Bangladesh ₹96.4 lakh (approximately 1 crore rupees) and the Central Bank of India ₹1.45 crore. In its press release, the RBI detailed the infractions and subsequent penalties.

The Central Bank of India faced penalties due to the approval of a working capital demand loan to a corporation against government subsidies, which was a violation of existing rules. This infraction highlighted the bank's non-compliance with proper lending procedures, leading to the hefty fine.

Similarly, Sonali Bank PLC was penalized for breaching KYC guidelines and other regulatory norms. The Indian branch of Sonali Bank PLC is part of Sonali Bank of Bangladesh, emphasizing the cross-border nature of this regulatory action.

The RBI clarified that these fines would not affect any transactions or contracts between the banks and their customers. Moreover, no additional actions, apart from the fines, would be taken against the banks.

This enforcement action followed a statutory inspection for the supervisory assessment of the Central Bank of India's financial condition as of March 31, 2022. The RBI's decisive measures underscore its commitment to maintaining strict adherence to financial regulations and ensuring the integrity of banking operations within India.