SBP slaps penalties on five banks for violating regulations

ISLAMABAD: The State Bank of Pakistan has slapped penalties worth Rs219 million on five commercial banks in December 2019 owing to procedural violations in areas of customer due diligence (CDD), know your customer (KYC) and Foreign Exchange (FX) operations, ARY News reported on Tuesday.

According to a statement issued by a spokesperson of SBP, the central bank, in addition to penal action, has advised these banks to strengthen their KYC,CDD and FX operation processes in order to avoid similar violations in future. The central bank has also urged the banks to launch an internal inquiry on the certain breaches.

The banks have been advised to bring improvements in their systems to avoid recurrence of such violations in future.

The central bank has also released the list of the banks faced fines over failure to comply with the regulations.

Last year on October 8, the State Bank of Pakistan (SBP) had imposed heavy fines on commercial banks over the violation of regulations during the period of July to September that year, the spokesperson had said in a statement.

The spokesperson had said that fines were imposed on 17 commercial banks over different violations of laws including anti-money laundering, information collection of consumers and foreign exchange rules.

According to the spokesperson, the central bank had imposed fines on commercial banks up to Rs1.12 billion which was the highest ever figure in history. In July, fines were imposed on four commercial banks up to Rs184.6 million and Rs805 million on 10 commercial banks in August. Moreover, three commercial banks had faced the imposition of fines Rs133.3 million in September this year.