The Reserve Bank of India (RBI) on Friday slapped penalties on 12 banks, amounting to R1.5 crore, on violations with regard to loan and current accounts of Deccan Chronicle Holdings Limited (DCHL) in certain branches in late 2013.
ICICI Bank was fined R40 lakh; Axis Bank and IDBI Bank were fined R15 lakh each and HDFC Bank was fined R5 lakh, among others.
RBI said it had carried out a scrutiny of the loan and current accounts of Deccan Chronicle Holdings in certain branches of these banks in late 2013. Based on the findings of the scrutiny, RBI issued showcause notices to the banks in March 2014, to which the individual banks submitted written replies.
“After considering the facts of each case and the individual bank’s reply, as also, the personal submissions by some of the banks before its committee of executive directors, RBI came to the conclusion that some of the violations were substantiated and warranted imposition of monetary penalty,” RBI said in a notification.
Lenders have an exposure of around R4,100 crore to the Hyderabad-based DCHL. ICICI Bank has the largest exposure of R490 crore, followed by Axis Bank’s R400 crore, Canara Bank’s R330 crore, Andhra Bank R200 crore, YES Bank R175 crore, Kotak Mahindra Bank R100 crore, Indian Overseas Bank R100 crore and Corporation Bank at R100 crore, among others.
For the nine months ended March 2014, the company reported net loss of Rs 3.73 crore on the revenues of Rs 263 crore in the same period.