CHAPTER I - MEMBERSHIP
3. Eligibility for Membership
applicant must be a bank in India included in Schedule II to
the Reserve Bank of India Act, 1934.
applicant must agree to adhere to the Code and sign the
Covenant in Form A.
applicant must pay a non-refundable registration fee of
Rs.10,000/- (Rupees ten thousand only) to the BCSBI.
4. Application for Membership
for membership of the BCSBI shall be made in Form B.
Chief Executive Officer shall place the application within
30 days of its receipt before the Board.
decision of the Board for admitting the applicant as member
or rejecting the application shall be communicated to
applicant within 45 days from the date of receipt of the
communication for admission shall state the membership fee
payable by the applicant for the first year, which it shall
pay within thirty
days from the date of the receipt of the said communication.
applicant whose application is rejected may make a
representation to the Board within 30 days from the date of
communication of rejection.
Board may, if it considers necessary, afford an opportunity
of hearing to the applicant.
decision of the Board regarding the admission of the
applicant to the membership of the BCSBI shall be final.
5. Membership Fees
Membership fees payable by Members shall be in proportion to
their gross domestic assets as on March 31, of the previous
year and shall be of such amount, as the Board may determine
as payable by each Member. Provided that the Board may
prescribe a minimum fee that each Member shall be liable to
fee for the first year shall be paid as stated in Rule 4.4.
fee for the subsequent years shall be paid annually in
advance in respect of each financial year commencing April 1
within 30 days of the date of the invoice issued by the
to pay annual membership fee within the specified time shall
incur a charge of interest at the rate of 2 percent per
annum above the Bank Rate from the date it is payable till
the date of payment.
where a Member does not pay the membership fee together with
interest due thereon for six months from the date of
invoice, the Board shall have a right to cancel membership
of the bank without any further notice in the matter.
fee shall not be liable to be refunded on cessation of
membership whether on account of the Member's voluntary
withdrawal or on cancellation by the Board or for any reason
withdrawal of membership by the Member or its cancellation
by the Board shall not prejudice the right of the Board to
institute any investigation or disciplinary proceedings
within three months of such withdrawal/ cancellation or the
right to continue any investigation or disciplinary
proceedings following such withdrawal/cancellation.
6. Obligations of the Member
Member shall provide the BCSBI with such information as the
BCSBI may require from it from time to time to discharge its
function of monitoring compliance with the Code.
Authorised representatives of the BCSBI shall be entitled to
visit the premises of any Member to verify and gather such
information deemed necessary for monitoring compliance with
Member shall cooperate with the authorised representatives
of the BCSBI visiting the bank.
Incognito visits may also be undertaken to the
premises of the Member.
Member shall publish in its Annual Report sanctions
imposed by the BCSBI.
7. Obligations of the BCSBI
discharging its functions and in all its dealings with the
Members, the BCSBI shall act in good faith.
BCSBI shall not, save as required by law, or as permitted in
accordance with these Rules, divulge any information in
relation to the affairs or business of the Member which it
knows at the time to be confidential and which has come in
its possession in the course of its business.
this, the BCSBI shall be free to divulge any information
about any Member to the Reserve Bank of India.
CHAPTER II - COMPLIANCE POLICY
8. Submission of Annual Statement of Compliance
Annual Statement of Compliance containing such information
and details as the BCSBI may specify shall be submitted to
the Board before July 31. This Statement shall be signed by
the duly authorised Code Compliance Officer or an official
duly authorised by the Member.
to submit the duly completed Annual Statement of Compliance
by due date, shall render the Member liable to a daily
default fine as may be decided by the Board, provided that
such fine shall not exceed Rs.1,000/- (Rupees one thousand
only) per day.
further that if the default in submission of the duly
completed Annual Statement of Compliance continues for six
months from the date when it is due, the Board shall have
the right to take appropriate action.
9. Code Compliance Officer
Member shall have a Code Compliance Officer at each of its
Controlling Offices above the level of the branch and at the
Head Office. Name, address and contact details of Code
Compliance Officer/s shall be promptly notified to the BCSBI
and shall be displayed at the branches falling under his
jurisdiction as also be available to customers.
Code Compliance Officer shall maintain a Register to keep a
record of all breaches within his jurisdiction of which he
becomes aware and also the details of the remedial action
The Code Compliance Officer shall inform the BCSBI of (a)
every breach, within 7 days, and (b) the remedial action
taken, within 15 days, of the breach being brought to his
Failure to comply with or fulfil any commitment/s or
any obligation/s, in full or in part thereof, under the Code
or these Rules shall constitute a Breach.
The purposes of disciplinary sanctions for breach of the
Code or these Rules are:
act as a deterrent against future breaches by the
engender public confidence in the Code by
demonstrating that Members cannot indulge in unfair,
unreasonable or unethical conduct with impunity;
help prevent Members from profiting from breaches
whether by acts of commission, such as exploitative
marketing or misleading advertising, or acts of
omission, such as failure to upgrade systems and
procedures to ensure compliance with Code
help exclude Members which demonstrate unwillingness
or serious inability to comply with Code obligations
breach by a Member shall render it liable to sanction under
these Rules. The Board shall act in a manner that is
transparent, proportionate and consistent.
No sanction shall be imposed on any Member without
giving it an opportunity of hearing by the Board.
CHAPTER III - DISCIPLINARY PROCEDURE
objective of the Disciplinary Procedure is to enable a
non-compliant member to put right the system in a
collaborative manner as quickly as possible. The effort
would be to take remedial action involving minimum cost and
inconvenience rather than penal measures.
12. Sources of Information
The BCSBI may choose to keep confidential, if so
requested, the identity of any person who refers a breach
for investigation to the BCSBI or its representative.
The BCSBI shall not undertake or cause investigation
on a complaint which is anonymous or is
considered to be fictitious, vexatious or frivolous. With
respect to other complaints, the BCSBI may undertake or
cause investigation at its discretion, but shall be under no
obligation to do so.
The Board may conduct or cause to conduct an
investigation into a breach which is alleged or suspected of
having been committed or which is alleged or suspected of
being committed by a Member.
The Executive may make enquiries, seek clarification if
necessary from the Code Compliance Officer, or in his
absence, from the Chief Executive of the Member concerned,
and from any other person it considers necessary.
The Board may appoint or request the Member to appoint
accountant/s or other relevant professional/s to assist it
in the investigation. Expenses including professional fees
in respect of such appointment shall be payable by the
The Executive shall prepare a draft statement of facts
making out a prima facie case of the alleged Breach.
The draft statement of facts shall be served on the Member
concerned, calling upon it to submit its explanation thereto
within the time specified in the notice.
The Board shall consider the explanation, if any, and decide
if the Breach is established and the sanction to be imposed,
having regard to its gravity and other relevant factors.
BCSBI shall inform its decision to the Member within 10 days
of the meeting of the Governing Council in which such
decision is taken.
The Member shall be provided with the reasons for the
decision, and for the proposed sanction, if any, to enable
it to make a representation in writing to the Board. The
representation must reach the Board within 30 days of the
date of the letter advising the Member of the decision of
representation under Rule 14.5 shall be considered by the
Board to decide whether its decision under Rule 14.3 needs
Member shall be advised of the Board's final decision within
ten days of the meeting of the Board at which that decision
final decision shall take effect from the date it is
communicated to the Member concerned.
that where no representation is received under Rule 14.5
within 20 days of the date of the letter advising the Member
of the decision of the Board, the decision of the Board
shall become effective on the expiry of that period.
For arriving at the sanction, all relevant factors shall be
taken into account, including:
extent of actual or potential harm to the customer;
the breach was isolated or systemic;
the breach was inadvertent, or represented a knowing
act of commission or omission;
length of time over which the breach continued
undetected or without effective remedial action being
there were any warning signals, such as concerns
expressed in the media, customer complaints, or
guidance from the BCSBI, and what heed was paid to
extent of damage to confidence in, or the reputation
of, the banking industry at large;
extent to which the Member sought to profit, or to
avoid or mitigate a loss, by its actions or omissions.
The Board shall be entitled to
impose one or more of the following sanctions:
publication of the Member's name and details of the
breach in the Annual Report of the BCSBI;
issue of directions as to future conduct of the
issue of a warning or reprimand to the Member;
cancellation or suspension for a limited period of
membership of the Member;
censure of the Member, by notifying the media of
the findings in respect of a breach or breaches
and any sanctions applied, and posting the press
release on the BCSBI's website. Instead of, or in
addition to, notifying the media, notification may
also be made to any other bodies, as the Board may
The Board shall ensure that its sanction does not
affect the confidentiality obligation of the Member to its
party shall bear its own costs incurred during the
Disciplinary Procedure except that the Member shall bear the
cost of any appointments made under Rule 14.3.
17. Intimation to the Reserve Bank of India
a sanction is imposed on any Member, the BCSBI shall inform
the Reserve Bank of India the details of the Breach and the
A Member who is dissatisfied in his dealings with the BCSBI
may address his complaint initially to the Chief Executive
Officer, unless it concerns the Chief Executive Officer's
personal handling of the matter.
If the Chief Executive Officer fails
to resolve the complaint, or is personally involved in the
cause of complaint, the complainant may write to the
Chairman of the
Such complaints will be dealt with within thirty days
from the date of its receipt.