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Why RBI has placed Bank of India under prompt corrective action

The action would mean the Mumbai-based lender would face restrictions on lending activity

Abhijit Lele  |  Mumbai 

With continuing weak financial and credit profile, the Reserve Bank of India (RBI) put public sector lender, Bank Of India (BOI), under prompt corrective action (PCA) with immediate effect. The fallout of the RBI action would be an increase in the cost of funds when the bank taps the market for resources and a dent in its market perception.

The action would mean the Mumbai-based lender would face restrictions on lending activity. BOI, where the government holds 75.1 per cent stake, will also have to step up efforts on recoveries from stressed assets, sale of non-core assets, and control ...

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First Published: Thu, December 21 2017. 10:00 IST
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