RBI slaps Rs2 crore penalty on Kotak Mahindra Bank for not sharing promoter shareholding details
The Reserve Bank of India (RBI) on Friday imposed a penalty of Rs 2 crore on Kotak Mahindra Bank for not complying with the central bank's directions to furnish details of its promoter shareholding.
 
The bank was directed by RBI to furnish information about details of the shareholding held by its promoters and to submit details of the proposed course of action or strategy of the bank for complying with the permitted timeline for dilution of promoter shareholding.
 
"The Reserve Bank of India (RBI) has imposed a monetary penalty of Rs 20 million on Kotak Mahindra Bank Limited for noncompliance with the directions issued to the bank by RBI in exercise of its powers under sections 27(2) and 35A of the Banking Regulation Act, 1949 (the Act) to furnish information specified therein," said the RBI statement.
 
The bank was also directed to convey its commitment to achieve the dilution in promoter shareholding as per the timelines stipulated, but, the bank failed to comply with the said directions and a show cause notice was issued to the bank
 
"After considering the reply received from the bank, submissions made by the bank during personal hearing and the documents submitted by it, RBI came to the conclusion that the bank had failed to comply with the directions issued by RBI and decided to impose monetary penalty on the bank," it said.
 
The apex bank, however, noted that the action is based on the "deficiencies in regulatory compliance" and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    BSE and ICCL Implement SEBI's Interoperability Framework for Clearing
    Asia's oldest exchange BSE and its subsidiary Indian Clearing Corp Ltd (ICCL) have gone live with the interoperability framework for clearing multiple trades. On Monday, ICCL received and cleared several trades from BSE and Metropolitan Stock Exchange of India Ltd (MSE).
     
    Ashishkumar Chauhan, managing director and chief executive (MD & CEO) of BSE, said, "We thank SEBI for conceptualising the world class interoperability framework. It will reduce the requirement for funds as well as reduce risk on the overall system when all the stock exchanges and clearing corporations become interoperable making Indian stock market more robust."
     
    Last year in November, market regulator SEBI had issued broad guidelines for operationalizing the interoperable framework among clearing corporations. 
     
    Devika Shah, MD&CEO of ICCL feels that interoperability will bring down cost of clearing substantially for members with netting benefits, bring efficiency in margins, collateral, clearing and settlement, while bringing down the systemic risk.
     
    To ensure that the transition to interoperability is seamless and non-disruptive, it was jointly decided by all stock exchanges and clearing corporations that members can choose a functional date for going live with Interoperability on any Monday from 3rd June till 1 July 2019.
     
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    RBI Bars Auditor SR Batliboi & Co from Bank Audits
    The Reserve Bank of India (RBI) on Monday barred auditing firm SR Batliboi & Company from handing audits in commercial banks for a period of one-year starting 1 April, 2019.
     
    The action has been taken for lapses in a statutory audit assignment, RBI said in a statement. The apex bank had put in place an enforcement action framework.
     
    "In terms of the aforesaid enforcement action framework, on account of the lapses identified in a statutory audit assignment carried out by the firm, M/s SR Batliboi & Co LLP, Chartered Accountants (ICAI Firm Registration Number: 301003E), it has been decided that RBI will not approve the said firm for carrying out statutory audit assignments in commercial banks for one year starting April 1, 2019," the statement said.
     
    S.R. Batliboi & Co is an affiliate of Ernst & Young (EY), one of the big four audit firms in India. The company had audited the accounts of Infrastructure Leasing & Financial Services (IL&FS). Besides, the firm is also the auditor of Interglobe Aviation, the owner of India's largest airline IndiGo, South Indian Bank and Aavas Financiers.
     
    RBI said that the action taken has been communicated to the Institute of Chartered Accountants of India.
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    COMMENTS

    Prakash Bhate

    2 months ago

    It is a pity that while the armed forces continue to battle Jaish-e-Mohammed and Laskkar-e-Taiba with bullets, home-grown financial terrorists only get rapped on the knuckles and can drive around freely in their Audis and BMWs.

    Ramachandran

    3 months ago

    It is high time that the Management Accountants are given a chance and the govt, get them involved in all types of Audits. Their expertise also should be utilized by the govt.

    Iyer Siva

    3 months ago

    It is high time stringent punishments are handed to these fraudsters in auditing assignments. Even the ICAI should invoke rules that cancels their practicing licenses for a decade at least anywhere in the country along with rolling back of audit fees that amassed as well and deposited back into Govt of India Treasury. One can imagine the same old street repeated all over again like that of PWC, when did such a colossal goof up in erstwhile Global Trust Bank and were banned from bank audits for 3 years only to return back to do the same filthy work at SATYAM COMPUTERS. This kind of nominal one year out of audit assignment will not serve any purpose. Shame on these professionals who did injustice to the profession of audit and chartered accountancy discipline itself.

    REPLY

    Ashok m Rane

    In Reply to Iyer Siva 3 months ago

    Good Demand. I fully support d view.

    ASHWIN AMRITLAL MEHTA

    3 months ago

    Alas, I am technocrat in this country. Life would have been much easy, If I would have been a C.A. or ICWA or any degree from commerce stream. Now I understand why all Science stream Professionals leave this country. And why Chartered accountants are not welcome in USA.

    REPLY

    Tarun Singhal

    In Reply to ASHWIN AMRITLAL MEHTA 3 months ago

    Too simplistic an argument!

    Ashok m Rane

    3 months ago

    Oh Shit! A serious fraud involving thousands of crores has taken place and the concerned Auditing Firm is just getting away with stoppage of one year Bank Audits. This can happen only in India. I always have a doubt that RBI and these people must be having some links. Let every body responsible from the firm be put under bars and take a criminal action and also levy heavy penalty.Unless stringent action is taken, we can never control such things. General Public is just made to believe that some serious action is taken by RBI! We are fooled!!!!

    Jibu Marks

    3 months ago

    Why only for one year?

    If such serious lapses were found in their working, RBI should impose much stricter and sterner penalties. Then only the so called professionals will desist from any wrong doings or being accomplice to frauds and malpractices by management of such companies.

    Why is RBI not considering the damage they (and of course the wing management) has done to the industry, economy, and retail investors?

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