Reserve Bank puts Lakshmi Vilas Bank under PCA framework over high NPAs

The bank said PCA would not have any adverse impact on its daily operations

The Reserve Bank of India (RBI) has initiated Prompt Corrective Action (PCA) against Lakshmi Vilas Bank (LVB) on account of a high level of bad loans, the lack of sufficient capital to manage risks, a negative return on assets for two consecutive years, and high leverage, the Chennai-based lender said on Saturday. 

The action came after an on-site inspection, under the risk-based supervision, was carried out for the year ended March 31, 2019. The regulator has advised the bank on restrictions put in place and corrective steps it needs to take. “The bank has taken note of (them) for necessary compliance,