REGULATORY · INDIA
RBI imposes Rs 31.8 lakh penalty on HSBC
Change
The Reserve Bank of India imposed a Rs 31.8 lakh monetary penalty on Hongkong and Shanghai Banking Corporation for non-compliance with directions on inoperative accounts and unclaimed deposits.
Why it matters
The RBI imposed a Rs 31.8 lakh penalty on Hongkong and Shanghai Banking Corporation following a statutory supervisory inspection referencing the bank's financial position as of March 31, 2025. The penalty was based on findings of non-compliance with RBI directions and related correspondence concerning inoperative accounts and unclaimed deposits. Identified deficiencies included absence of a searchable unclaimed-deposits database on the bank's website and failure to generate and assign UDRNs for certain deposits transferred to the DEA Fund. The penalty addresses statutory and regulatory compliance deficiencies and does not adjudicate the validity of customer transactions or agreements.
Implications
- · Searchable unclaimed-deposit databases and UDRN assignment become explicit compliance obligations for banks under RBI supervision.
- · Deposit-operations and IT systems are implicated in capturing, tracking, and publishing unclaimed-deposit records.
- · Compliance, risk, and legal functions face increased documentation and supervisory scrutiny on handling inoperative accounts.
Who is affected
- · Commercial banks operating in India
- · Deposit-operations teams
- · Bank compliance and risk officers
- · Bank legal and regulatory affairs departments
Source
Topics
Law & Public Safety Regulatory Actions Compliance Finance & Banking Banking Regulation