SBP imposes penalty of over Rs.83 million on 4 banks for violating regulatory orders

KARACHI: State Bank of Pakistan (SBP) imposed fines of over Rs.83.157 million on four commercial banks during July- September 2023 on the charges of violation of regulatory instructions pertaining to foreign exchange, general banking operations and customers’ due diligence.
The banks were also advised to ensure meticulous compliance with the regulatory instructions and improve and strengthen their systems and controls to avoid recurrence of violations, the central bank said on Wednesday in details released by Banking Supervision Department-1 about significant enforcement actions taken during the Quarter ended September 30, 2023.
The central bank imposed a penalty of Rs.26.5 million on United Bank Limited for violation of regulatory instructions pertaining to foreign exchange (FX) and general banking operations. In addition to penal action, the bank has been advised to strengthen its controls and ensure meticulous compliance with the regulatory instructions.
The Bank of Punjab received a penalty of Rs.21.569 million for violation of regulatory instructions pertaining to General Banking Operations (GBO) while it was also advised to strengthen its systems and controls to avoid the recurrence of regulatory violations.
The SBP imposed a fine of Rs.18.51 million on JS Bank Limited for violating regulatory instructions pertaining to customers’ due diligence/know your customers (CDD/KYC), FX and GBO. The bank has been advised as well to strengthen its systems and controls to avoid the recurrence of regulatory violations.
The banking regulator also imposed a penalty of Rs.16.578 million on Allied Bank Limited for violation of regulatory instructions pertaining to GBO while the bank has been advised to improve its internal processes in order to avoid violations in future.
The SBP clarified that penal actions were based on deficiencies in the compliance of regulatory instructions and they do not constitute a comment on the financial soundness of the penalized banking entities. – APP