RBI fined 19 banks for violation of rules

The Reserve Bank on Tuesday fined 19 banks for violation of rules on derivatives.

It has fined Axis Bank, Barclays, Citi, Credit Agricole, RBS , Ing Vysya bank and SBI. Stanchart, BoA, DBS, Deutsche, HSBC, JP Morgan have also been fined .

The penalties have been imposed on these banks for contravention of various instructions issued by the Reserve Bank in respect of derivatives-failure to carry out due diligence in regard to suitability of products, selling derivative products to users not having risk management policies and not verifying the adequacy of underlying and eligible limits under past performance route.

The Reserve Bank had issued showcause notices to these banks. In response to this, the banks submitted their written replies. On a careful examination of the banks' written replies and the oral submissions made during the personal hearings, the Reserve Bank found that the violations were carried out and penalties were thus imposed.