FromINDIAN OVERSEAS BANKCENTRAL OFFICECHENNAI : 600 002

Ref. No.DateIssuing Dept.

MASTER/ bg- / 2015-1603.07.2015

: OPERATIONS DEPT

TO ALL BRANCHES / REGIONAL OFFICES / ZO / OTHER OFFICES

I SYSTEMS AND PROCEDURES IREVISED POLICY -2015 ON KNOWYOUR CUSTOMER (KYC) NORMS /

ANTI MONEY LAUNDERING (AML) STANDARDS /

COMBATING OF FINANCING OF TERRORISM {CFT} AND

OBLIGATION OF THE BANKS UNDER PREVENTION OF MONEY LAUNDERING ACT

1. PREAMBLE

1.1. Our Bank's Policy on Know your Customer {KYC}norms /Anti Money Laundering {AML} Standards / Combating ofFinancing of Terrorism {CFT} was first approved by theBoard, in December 2005. Central Office had issued adetailed circular on Policy Document on KYC and AMLProcedures {PDoc. KYC AML} vide MISC/250/2005-06dated 31st December 2005.

1.2. Based on RBI Master Circular DBOD.AML.BC.No.24/14.0l.001/ 2013-14 dated 1st July 2013,the revisionsmade in KYC/ AML/ CFT gu ide li n es up to June 2013 wereadvised vide CO Circular MASTER/ 49 / 2014-15 dated13.05.2014.

1.3. Reserve Bank of India has subsequently issued manydirectives which have been advised to branches by way ofcirculars periodically. Reserve Bank of India has also issueddirectives on KYC Norms/ AML Standards/CFT in respect ofMoney Changing Activities and Cross Border InwardRemittance under Money Transfer Service Scheme. ReserveBank of India has come out with MasterCircularDBOD.AML.BC.No.22/ 14.0 l.00 1/2014-15 dated 1stJuly 2014 consolidating the instructions on KYC/ AML/ CFTissued up to 30th June 2014.

1.4. The revised policy on KYC norms/ AML Standards/ CFT andobligations of the Bank under Prevention of MoneyLaundering Act, on the basis of aforesaid directives andsubsequent directives issued by Reserve Bank of India upto 30th November 2014 was approved by the RiskManagement Committee of the Board on 22.06.2015 andconfirmed by the Board at its meeting held on 25.06.2015.The text of the revised policy is enclosed in the annexure forthe benefit of Branches, Regional Offices, ZOs and OtherOffices.

1.5. Circulars issued by the Operations Department onmodifications in KYC/AML policy effected subsequent toNovember 30, 2014 (which have already been ported in lOBonline & RBI.org.in) will be incorporated in the ensuingmaster circular.

2. OPERATIONAL INSTRUCTIONS

2.1. Branches, Regional offices, ZOs and other Offices arerequired to note that the revised Policy Document on KYC

2and AML Procedures, as per Annexure, standsoperationalised with immediate effect.

2.2. The Revised Policy is to be read with our Permanent/Misecircularsa) 340/2013-14 dated 2l.1l.2013 - KYC-Information sought

by banks from customers.b) 341/2013-14 dated 2l.1l.2013 Opening of Bank

Accounts by Foreign Students studying in India - KYCprocedure for opening of bank accounts.

c) 342/2013-14 dated 23.1l.2013 - KYC - e-KYC service ofUIDAI - Recognising ONLINE Aadhaar authentication(electronic verification process) to be accepted as an'Officially valid document' under PML rules.

d) 361/2013-14 dated 07.0l.2014 - KYC Amendment toSection 13(2).

e) 379/2013-14 dated 06.03.2014 - KYC - Recognising e-Aadhaar as an 'officially valid document' under PMLrules.

f) 398/2014-15 dated 12.05.2014 - KYC - Harmonization ofKYC norms for Foreign Portfolio Investors (FPls).

a) MISC/455/2014-15 dt.9.10.2014 by OperationsDepartment - Officially Valid KYC documents based onRBI circular no. DBOD.AML.BC.No. 26/14.0l.001/2014-15 dt 17.07.2014

b) MISC/456/2014-15 dt 1l.10.2014 by OperationsDepartment - clarifications officially valid documents -based on IBA circular letter no. RB/KYC&AML/660 dt22.09.2014

c) MISC/458/2014-15 dt 15.10.2014 procedure fordetermining Beneficial ownership - based on RBIcircular No. DBOD.AML.BC.No. 26/14.0l.001/2014-15 dt17.07.2014

d) MISC/460/2014 - 15 dt 20.10.2014 - clarification onproof of address based on RBI circular no.DBOD.AML.No. 5487/14.01.001/2014-15 dt. 13.10.2014

e) MISC/462/2014-15dt 25.10.2014- Partial Freezing ofaccounts - based on RBI circular no. DBOD.AML.BC.no.44/14.0l.001/2014-15 dt. 2l.10.2014

f) MISC/470/2014-15 dt 26.1l.2014 by Operations Dept-Dispensation of Positive confirmation - based on RBIcircular no DBOD.AML.BC. No.39/14.0l.001/2014-15 dt04.09.2014

2.3. Section-R of the aforesaid revised policy details theguidelines on KYC norms / AML Standards / CFT in respect ofmoney changing activities and Cross Border InwardRemittance under Money Transfer Service Scheme.

2.4. Operational/Administrative staff at branches, RegionalOffices and other Offices are advised to carefully peruse therevised text of Policy Document on KYC/ AML and fine tunetheir perception to assimilate the spirit underlying in eachand every issue, addressing to the dire need to safeguardour . Banki~g .. System and genuine customers from the L--,dubIOUS ac tivi ti es of Money Launderers. \-

33. CONCLUSION

3.1. Branches, Regional Offices, ZOs and other offices areadvised to note that the guidelines on KYC and AMLprocedures advised by RBI and the statutory obligationsunder Prevention of Money Laundering Act will go a longway in tackling the menace of Money Laundering,

3.2. Violation/non-compliance of KYC/ AML Procedures shallattract penalty and will also result in down-rating of ourBank's performance in the Annual Financial Inspection (AFI)report by Reserve Bank of India,

3.3. Operational Staff are required to realize the functionalsignificance of KYC/ AML Procedures and ensure sin cer ecommitment for compliance in their day-to-day activities ofbranch banking to safeguard our esteemed genuinecustomers, the bank and its work force from he nefariousactivities of Money Launderers.

(BA KISHAN T)GENERAL MANAGER

INDEX UNDER: SYSTEMS AND PROCEDURES

ANNEXURE : Revised policy on KYC Norms I AML Standards I Combating of Financing of Terrorism(CFT) and Obligation of the Banks under Prevention of Money Laundering Act.