RBI imposes penalty on BNP Paribas, three other NBFCs

The Reserve Bank of India has imposed a penalty of Rs 31.8 lakh on BNP Paribas (the bank) for certain deficiencies in statutory and regulatory compliance.

The central bank has also imposed penalties on Hewlett Packard Financial Services (India), SMFG India Credit Company, and Muthoot Vehicle & Asset Finance for non-compliance with certain norms.

In a statement, the RBI said the penalty has been imposed on the bank for non-compliance with certain directions issued by it on 'Interest Rate on Advances'.

The statutory inspection for Supervisory Evaluation of the bank was conducted by it concerning its financial position as of March 31, 2023.

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Based on supervisory findings of non-compliance with RBI directions and related correspondence in that regard, a notice was issued to BNP Paribas, advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the said directions.

After considering the bank's reply to the notice, additional submissions by it, and oral submissions made during the personal hearing, the RBI said it found that the charge against the bank was sustained, warranting imposition of monetary penalty.

"The bank failed to adopt uniform external benchmark within the same loan category in respect of certain loans," the central bank said.

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Additionally, a penalty of Rs 10.40 lakh has been imposed on Hewlett Packard Financial Services (India) Private Limited, Rs 7.9 lakh on Muthoot Vehicle & Asset Finance Limited and Rs 23.1 lakh on SMFG India Credit Company Limited (formerly known as Fullerton India Credit Company Limited).

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