KYC laxity at private banks has put us to loss: SBI

Last Updated: Sun, Jun 16, 2013 12:31 hrs

In the wake of the Cobrapost expose on violation of KYC norms by almost all banks, State Bank of India Chairman Pratip Chaudhuri has said his bank has been "put to a loss" by the non-compliance of guidelines by private sector peers.

"Our bank has been put to a loss because of the relatively lax implementation of the Know-Your-Customer (KYC) norms, particularly in private banks," Chaudhuri told PTI in an exclusive interview here.

The country's top three private sector lenders --ICICI Bank, HDFC Bank and Axis Bank -- which were the targets of news portal Cobrapost in February, have already been penalised by Reserve Bank for KYC violations.

Chaudhuri asserted that not a single KYC anomaly has been found against his executives either in the RBI probe or in its own probe (overseen by a deputy managing director who is not part of the national banking team) following the release of the second installment of sting operation by the portal, which also showed SBI officials erring on norms.

He said the sting operation had found one executive offering hawala services like depositing money in the country and withdrawing in London, while another asked the undercover reporter to split up the amount and deposit.

"We ordered an enquiry into all these cases. We have done a thorough investigation and have not found a single case (of wrongdoing).... The RBI has also not faulted us and has not found any mistake in any of our branches so far," Chaudhuri said.

Cobrapost, in February, came out with a video showing executives at the top three private banks offering services like accepting large amount of unaccounted cash, which is against anti-money laundering norms and also against the KYC norms. However, the subsequent RBI probe did not find any anti-money laundering violations.

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