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Tuesday, December 5, 2023

Exclusive: At least two Indian banks taken off of RBI’s corrective action list-source

Exclusive: At least two Indian banks taken off of RBI's corrective action list-source© Reuters. A security guard stands next to the logo of {{0|Reserve Bank of India}} inside its headquarters in Mumbai

NEW DELHI (Reuters) – A Reserve Bank of India panel has decided to remove both Bank of India and Bank of Maharashtra from its prompt corrective action plan (PCA) for state-owned banks that had high levels of bad debt and inadequate capital, a source directly aware of the development told Reuters on Thursday.

The source, who asked not to be named as the discussions are private, said the move follows improvements in the asset quality and capital ratios of both banks.

The central bank’s board for financial supervision took the decision at its meeting on Thursday after reviewing the December quarter performance of all banks on the PCA list, the source said.

One other bank may also be removed from the list pending the outcome of a technical clarification from the bank, the source added.

The RBI put 11 state-owned lenders on the PCA list in the past few years. As a result, it barred them from issuing fresh big-ticket loans and expanding their operations, as well as putting their financial performance under close scrutiny.

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Source: Investing.com

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