Mumbai, Oct 13 (IANS): The Reserve Bank of India (RBI) on Friday said it has imposed monetary penalties on Union Bank of India and RBL Bank for the violation of norms.

The RBI has imposed a Rs 1 crore penalty on the Union Bank of India as it did not comply with certain directions and sanctioned a term loan to a corporation in lieu of or to substitute budgetary resources envisaged for certain projects, without undertaking due diligence on the viability and bankability of the projects to ensure that revenue streams from the projects were sufficient to take care of the debt servicing obligations, the statement explained.

RBL Bank was fined Rs 64 lakh because it failed to obtain an annual declaration in Form B from one of its major shareholders, within one month of the close of the three financial years ending on March 31, 2018, March 31, 2019 and March 31, 2020, and furnish certificates to RBI regarding continuance of the 'fit and proper' status of one of its major shareholders, by the end of September of the said three financial years, the press statement said.

"This action is based on the deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers," RBI added.