How many banks are in PCA now?

Currently, there are three public sector lender Indian Overseas Bank (IOB), UCO Bank and Central Bank of India that are under the RBI’s PCA framework.

Which banks are under PCA in 2020?

With this, only two public sector banks – Central Bank of India and Indian Overseas Bank – remain under RBI’s PCA framework.

Which banks are under PCA now?

Now, only Mumbai-based Central Bank of India remains under PCA regime. RBI, in a statement, said its Board for Financial Supervision reviewed the performance of the IOB. The bank is not in the breach of the PCA parameters as per its published results for the year ended March 31, 2021, said RBI.

Is prompt corrective action applicable to cooperative banks?

Prompt Corrective Action Framework refers to the central bank’s watchlist of weak banks. The regulator imposes restrictions like curbs on lending on such banks. The PCA Framework applies only to commercial banks and does not cover cooperative banks and non-banking financial companies.

Why banks are put under PCA?

The objective of the PCA framework, RBI said, is to enable supervisory intervention at appropriate time and require the supervised entity to initiate and implement remedial measures in a timely manner, so as to restore its financial health.

What is PCA prompt corrective action?

The RBI on Tuesday issued a revised Prompt Corrective Action (PCA) framework for banks to enable supervisory intervention at “appropriate time” and also act as a tool for effective market discipline. Capital, asset quality and leverage will be the key areas for monitoring in the revised framework, the RBI said.

Which three banks have been removed by the PCA framework by RBI?

IOB is being tipped as a privatisation candidate. In 2021, RBI has also removed PCA restrictions on IDBI Bank and UCO Bank.

Which bank has been removed by RBI from prompt corrective action framework?

For example, RBI removed PCA from Bank of India and Bank of Maharashtra in January 2019 after their net non-performing assets ratio fell below the risk threshold of 6\%. But they were not profitable when the restrictions were lifted.

What is prompt corrective action?

A prompt corrective action framework, introduced for banks in 2002 and upgraded a couple of times thereafter, works as an early warning signal for banks in stress. The framework gets activated when banks fail to meet certain financial parameters that the regulator…..