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RBI initiates PCA against Bank of Maharashtra

IANS  |  Mumbai 

The Reserve of (RBI) has initiated "prompt corrective action" (PCA) on state-run lender of in the view of its high non-performing assets (NPAs).

"The RBI vide its letter dated June 15 has initiated PCA for of in view of high net NPA," the said in a regulatory filing to the BSE on Saturday.

"This action will not have any material impact on the performance of the and will contribute to improve the internal controls of the and improvement in its asset quality, profitability and efficiency."

Earlier, the RBI had initiated a PCA on Central of India, IDBI Bank, Indian Overseas Bank, UCO and Dena

The development follows the April 13, 2017, revision of the PCA guidelines by the RBI.

In April, the RBI said that capital, asset quality and profitability would be the basis for the PCA framework on which the banks would be monitored and has defined three kinds of risk thresholds.

In a notification issued then, the RBI said mandatory action to be taken when a breaches the risk threshold includes restriction on dividend payment, remittance of profits, restriction on branch expansion, higher provisions, restriction on management compensation and director's fees.

"The PCA framework would apply without exception to all banks operating in India, including small banks and foreign banks operating through branches or subsidiaries based on breach of risk thresholds of identified indicators," the RBI had said.

With regard to credit risk related action, the RBI can ask the banks to prepare a time bound plan and commitment for reduction of NPAs; restrict or reduce credit expansion for borrowers below certain rating grades or unrated borrowers/unsecured exposures/loan/concentration of loans in identified sectors or borrowers.

--IANS

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

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RBI initiates PCA against Bank of Maharashtra

The Reserve Bank of India (RBI) has initiated "prompt corrective action" (PCA) on state-run lender Bank of Maharashtra in the view of its high non-performing assets (NPAs).

The Reserve of (RBI) has initiated "prompt corrective action" (PCA) on state-run lender of in the view of its high non-performing assets (NPAs).

"The RBI vide its letter dated June 15 has initiated PCA for of in view of high net NPA," the said in a regulatory filing to the BSE on Saturday.

"This action will not have any material impact on the performance of the and will contribute to improve the internal controls of the and improvement in its asset quality, profitability and efficiency."

Earlier, the RBI had initiated a PCA on Central of India, IDBI Bank, Indian Overseas Bank, UCO and Dena

The development follows the April 13, 2017, revision of the PCA guidelines by the RBI.

In April, the RBI said that capital, asset quality and profitability would be the basis for the PCA framework on which the banks would be monitored and has defined three kinds of risk thresholds.

In a notification issued then, the RBI said mandatory action to be taken when a breaches the risk threshold includes restriction on dividend payment, remittance of profits, restriction on branch expansion, higher provisions, restriction on management compensation and director's fees.

"The PCA framework would apply without exception to all banks operating in India, including small banks and foreign banks operating through branches or subsidiaries based on breach of risk thresholds of identified indicators," the RBI had said.

With regard to credit risk related action, the RBI can ask the banks to prepare a time bound plan and commitment for reduction of NPAs; restrict or reduce credit expansion for borrowers below certain rating grades or unrated borrowers/unsecured exposures/loan/concentration of loans in identified sectors or borrowers.

--IANS

rv/vd

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

image
Business Standard
177 22

RBI initiates PCA against Bank of Maharashtra

The Reserve of (RBI) has initiated "prompt corrective action" (PCA) on state-run lender of in the view of its high non-performing assets (NPAs).

"The RBI vide its letter dated June 15 has initiated PCA for of in view of high net NPA," the said in a regulatory filing to the BSE on Saturday.

"This action will not have any material impact on the performance of the and will contribute to improve the internal controls of the and improvement in its asset quality, profitability and efficiency."

Earlier, the RBI had initiated a PCA on Central of India, IDBI Bank, Indian Overseas Bank, UCO and Dena

The development follows the April 13, 2017, revision of the PCA guidelines by the RBI.

In April, the RBI said that capital, asset quality and profitability would be the basis for the PCA framework on which the banks would be monitored and has defined three kinds of risk thresholds.

In a notification issued then, the RBI said mandatory action to be taken when a breaches the risk threshold includes restriction on dividend payment, remittance of profits, restriction on branch expansion, higher provisions, restriction on management compensation and director's fees.

"The PCA framework would apply without exception to all banks operating in India, including small banks and foreign banks operating through branches or subsidiaries based on breach of risk thresholds of identified indicators," the RBI had said.

With regard to credit risk related action, the RBI can ask the banks to prepare a time bound plan and commitment for reduction of NPAs; restrict or reduce credit expansion for borrowers below certain rating grades or unrated borrowers/unsecured exposures/loan/concentration of loans in identified sectors or borrowers.

--IANS

rv/vd

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

image
Business Standard
177 22