RBI imposes Rs5 lakh fine on HDFC

Mumbai: The Reserve Bank of India on Friday said it has imposed a penalty of Rs 5 lakh on Housing Development Finance Corporation Limited (HDFC) for non-compliance with certain provisions issued by the National Housing Bank (NHB).

Giving details, the Reserve Bank of India (RBI) said a statutory inspection of the company was conducted by NHB with reference to its financial position as on March 31, 2020.

It was revealed, inter alia, that the company failed to transfer matured deposits of certain depositors to designated bank accounts of such depositors during the period 2019-20, the RBI said in a statement.

In furtherance to the same, a notice was issued to the company advising it to show cause as to why penalty should not be imposed on it for failure to comply with the directions, as stated therein.

“After considering the company’s reply to the notice, additional submissions made by it and oral submissions made during the personal hearing, RBI came to the conclusion that the charge of non-compliance with the aforesaid statutory directions was substantiated and warranted imposition of monetary penalty on the company, to the extent of non-compliance with the directions,” it said.

The Finance (No. 2) Act, 2019, amended the National Housing Bank Act, 1987 conferring certain powers for regulation of Housing Finance Companies (HFCs) with the RBI. In another statement, the RBI said that it has imposed a penalty of Rs 11.25 lakh on IGH Holdings Private Limited, Mumbai for non-compliance with certain provisions.