The State Bank of India on Thursday said it is confident of meeting the regulatory requirements at one of its US arms soon and also that it is working towards appointing more professionals, including banking secrecy executives, as desired by the regulators there.
"There is absolutely no fine and no instances of mismanagement on our part. This is a minor issue. A section of the media here has blown the issue out of proportion and that there are nothing much in contravention to the regulatory requirements.
When asked about the reported high bad loan levels at the California operations, Contractor said, the bank has been working on improving it and the same "has come down to under 4 per cent now, while the capital adequacy ratio is a high 20 per cent."
Measures will help the bank meet the risk-mitigation measures demanded by local US regulators, he said, adding having the banking secrecy executives across its US operations will help SBI meet the KYC requirements as specified by Federal Deposits Insurance Corporation (FIDC).
Recently the US federal regulator had asked the Californian subsidiary of State Bank of India not to open a new bank in the country without the permission of regulators and also to bolster its compliance with the Bank Secrecy Act.
In a March 20 order, the Federal Deposit Insurance Corporation and the California Department of Financial Institutions had asked SBI California to have and retain qualified management and conduct within 90 days, an independent study to ensure it "is staffed by qualified individuals commensurate with its size and risk profile to ensure the safe and sound operation of the bank".
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