19 BANKS FINED FOR VIOLATION OF DERIVATIVES NORMS

The RBI has imposed penalties on 19 commercial banks for flouting instructions related to derivative. The banks that have been fined include six private sector banks, nine foreign banks and one public sector bank. According to the RBI, the penalties have been imposed on these banks for contravention of various instructions issued by the Reserve Bank in respect of derivatives. Such as, failure to carry out due diligence in regard to suitability of products, selling derivative products to users not having
risk management policies and not verifying the underlying/adequacy of underlying and eligible limits
under past performance route.