Axis Bank denies reports of licence cancellation; RBI says no such action initiated

Coming to the bank's rescue, the Reserve Bank of India (RBI) also said it has not initiated any action against Axis Bank for cancellation of its license, as held by some media reports.

By Rd. Alexander | Last Updated: Dec 12, 2016, 19:10 PM IST
Axis Bank denies reports of licence cancellation; RBI says no such action initiated

New Delhi: India's third biggest private sector bank, Axis Bank, on Monday denied reports that authorities were planning to cancel the bank's license for its alleged involvement in violative activities post-demonetisation.

Coming to the bank's rescue, the Reserve Bank of India (RBI) also said it has not initiated any action against Axis Bank for cancellation of its license, as held by some media reports.

Post demonetisation, officials of Axis Bank have been reportedly involved in a series of violative activities, helping individuals and customers to convert black money into white money.

In this relation, the bank had last week informed that it had suspended some 19 employees over alleged breaches at one of its branches in implementing a government-ordered exchange of high-value bank notes.

Replying to the reports of its license being cancelled, Axis Bank said in a stock exchange filing, "We firmly believe that said news is intended to spread panic amongst the general public, demoralise the staff and damage the reputation of the bank”.

"We would like to bring to your attention, the false and malafide news published in a regional newspaper alleging consideration of regulatory action against the bank," the bank further said in the filing.

The RBI, issuing a statement in the matter, stated that it “has not initiated any action to cancel the banking licence of Axis Bank in the wake of certain allegations about some serious irregularities in transactions relating to deposit/exchange of specified bank notes in a few branches of the bank".

The RBI`s clarification came after a regional newspaper published that the bank was likely to lose its banking licence. According to the media report, the government was considering cancelling its license after 19 of its officials were found carrying out violative activities.