KARACHI: The State Bank of Pakistan (SBP) has imposed monetary penalty amounting to Rs 272 million on four banks during September 2020 on procedural violations in the area of Customer Due Diligence (CDD) and Know Your Customer (KYC).

According to details of significant enforcement actions by the SBP during the quarter ending September 30, 2020, a monetary plenty of Rs 116.269 million was imposed on a private Islamic bank on procedural violations in the areas of CDD, KYC and general banking operations & asset quality. In addition to penal action the bank has been advised to strengthen its processes to avoid recurrence of such violations.

Another private Islamic bank fined Rs 86.119 million on violations in the areas of Anti Money Laundering (AML), Combating the Financing of Terrorism (CFT), Foreign Exchange operations and general banking operations. In addition to penal action the bank was directed to conduct an internal inquiry on breaches of regulatory instructions and take disciplinary action against the delinquent officials.

The SBP imposed monetary penalty of Rs 59.234 million on a private bank for procedural violations in the area of CDD and KYC. In addition to penal action, the bank has been asked to strengthen its processes to avoid recurrence of such violations.

Another leading commercial bank fined Rs 10 million for procedural violations in the area of general banking operations. In addition to penal action, the bank has been advised to strengthen its processes to avoid recurrence of such violations.

Overall, the SBP has imposed Rs 271.62 million monetary penalty on four private banks during September. However, the SBP said that these actions are based on deficiencies in the compliance of regulatory instructions and does not constitute a comment on the financial soundness of the entity.

Copyright Business Recorder, 2020