On Friday, the Reserve Bank of India said it had fined Housing Development Finance Corporation Limited (HDFC) Rs 5 lakh for non-compliance with specific regulations issued by the National Housing Bank (NHB). The Reserve Bank of India (RBI) provided details, saying NHB conducted a statutory check on the company concerning the company’s financial position as of March 31, 2020.
In a statement, the RBI said, among other things, it was revealed that the company had failed to transfer maturing deposits of certain depositors to the designated bank accounts of these depositors during 2019-20. To this end, a notice has been sent to the company advising it to explain why it should not be fined for failing to comply with its instructions.
“After considering the company’s reply to the notice, additional submissions made by it and oral submissions made during the personal hearing, RBI concludes that the allegation of non-compliance with the above statutory directions is warranted imposition of monetary penalty on the company, to the extent of non-compliance of directions,” it said.
In a filing to the stock exchange, HDFC informed of the fine and said it would take necessary steps to comply with the RBI letter. The Finance (No. 2) Act 2019 amends the National Housing Banking Act, 1987, by granting the RBI certain powers to regulate housing finance companies (HFCs).
In a separate statement, the RBI said it had fined Mumbai-based IGH Holdings Private Limited Rs 11.25 lakh for non-compliance with specific regulations. In both cases, the RBI said the penalties were based on deficiencies in regulatory compliance and not to declare the validity of any transactions or agreements entered into by the companies with customers.