As part of the overall structure for Corporate Governance, the Compliance Function serves a critical role. Therefore, it has been decided to introduce certain principles, standards and procedures for Compliance Function in UCBs, keeping in view the principles of proportionality. Accordingly, this Circular shall be applicable to all UCBs under Tier 3 and Tier 4 categories1 except UCBs under All Inclusive Directions (AID)2. UCBs under Tier 1 and Tier 2 categories shall continue to be governed under the existing guidelines3.
2. The UCBs under Tier 4 category shall put in place a Board-approved policy and a Compliance Function, including the appointment of a Chief Compliance Officer (CCO), based on the Framework given in the Annex, latest by April 1, 2023. The UCBs under Tier 3 category shall implement the same latest by October 1, 2023.
3. This Circular shall be placed in the immediate next meeting of the Board of Directors for information and devising an implementation strategy, under the Board’s supervision, in a time-bound manner.
Yours faithfully,
(Tarun Singh)
Chief General Manager
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