| RBI said it imposed a penalty of Rs 5 lakh on IDBI Bank for violation of the RBI guidelines on opening of accounts, including joint accounts, know your customer (KYC) norms and also for violation of guidelines relating to IPO financing. |
| IDBI was fined in February this year for extending IPO finance in excess of the limit specified for individuals by allowing pooling of funds by certain individuals. The pooling of IPO finance was facilitated by non-adherence to the KYC norms. |
| RBI had issued a show cause notice to IDBI Bank in response to which the bank had submitted its written response. The bank's CMD, V P Shetty, also had a personal hearing with the RBI. |
| RBI said on careful examination of the bank's submissions, both oral and written, it came to the conclusion that the violations were substantiated and has accordingly imposed the monetary penalty. |
| HDFC Bank has also been fined for the second time for its role in facilitating the IPO allotment scam. |
| In February, RBI had fined HDFC Bank Rs 25 lakh, ING Vysya Bank Rs 10 lakh and IDBI Rs 5 lakh. In January 2006, the RBI had penalised seven banks. |
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