Reforms meaningful only if understood in proper perspective: Mundra

RBI’s prompt corrective action framework facilitates banks to take corrective measures to restore their financial health, said SS Mundra

geetanjali

Geetanjali Minhas | July 14, 2017 | Mumbai


#prompt corrective action   #banks   #RBI deputy governor   #SS Mundra   #Governance Now   #India Banking Reforms Conclave 2017  


“Any intended reforms will be meaningful only if they are understood in proper perspective which all stakeholders have to value,” said RBI deputy governor SS Mundra while delivering his keynote address at the Governance Now, India Banking Reforms Conclave 2017, in Mumbai on Friday.
 
Mundra said that despite banks deploying best technology for securing their network, cyber attacks  have acquired unprecedented scale and complexity. 
 
He cautioned customers to use passwords protection provided by banks rationally and with responsibility. He added: “All security footprints of the person who has initiated the transaction can be captured in the system.”
 
Explaining PCA (Prompt Corrective Action) framework of the RBI, the top banking official said: “Sometimes the stake holders fail to appreciate the import of intended changes and get misled by the uninformed or at times motivated interpretations. The related aspect is the reaction of customers to such propaganda.”
 
He added: “PCA framework is one such supervisory tool which involves monitoring of certain performance indicators of banks as an early warning exercise. It is initiated on thresholds relating to capital, asset quality etc. Its objective is to facilitate for banks to take corrective measures including those prescribed by the RBI in a manner to restore their financial health.”
 
Mundra said though PCA Framework has been in operation since Decemeber2002, the April 13, 2017 guidelines are only a revision in the framework .
 
“The entire exercise is to restore the health of PCA bank through closer and expert engagement of our supervisory team with management of  such banks  for assessment of progress made.”
 
He explained that the amount of Rs 6 lakh crore lent to 10 companies/ individuals as mentioned by sections of the media may be exposure to certain groups of certain industrial conglomerates or several entities within the group, including SPVs. “It is too ad hoc to assume that all entities under in such a group are under stress and all would simultaneously default.”
 
He added that RBI being the regulator of financial sector is no way connected to lending by banks.
 

 

Comments

 

Other News

How much time do you spend talking on phone?

How much time do Indians spend talking on phone? It is on average 761 minutes per month, according to a new report from the Telecom Regulatory Authority of India (TRAI). The telecom regulator released its report, titled ‘The Indian Telecom Services Performance Indicators: July-Septemb

“Developing public health infrastructure key to sustainable healthcare for all”

Renowned cardiologist Dr Ramakanta Panda has said that the pandemic has exposed the inadequacy of existing healthcare systems and it is wrong to draw comparisons with Korea, a country with the population equal to that of a single Indian state. While speaking to Kailashnath Adhikari, MD, Gove

SC-appointed panel on farm laws holds first meet

The committee of experts appointed by the supreme court to deliberate with the stakeholders on the new farm laws held its first meeting here Tuesday, with one of its members saying that all stakeholders, including individual farmers, will be heard. Hearing a petition on the farm laws enacted

India’s glitch-free vaccination gathers pace

The nationwide vaccination campaign launched Saturday, the largest such exercise in the world, has started setting new benchmarks, with vaccines administered to 2,24,301 beneficiaries in the first two days. “India has vaccinated the highest number of persons on Day1 under its COVID19 v

Maharashtra to spend Rs 2,500 crore to augment, develop power infrastructure

The Maharashtra government has announced a spending of Rs 2,500 crore annually to develop infrastructure of state-owned distribution company Mahavitaran (MSEDCL).   Out of the total amount, Rs 1,500 crore will be spent on energisation of conventional agriculture pumps and Rs 1,000 crore

Launched: Largest vaccination drive in history

India on Saturday began the massive vaccination drive against Covid-19, as prime minister Narendra Modi paid tributes the ‘corona warriors’. “Such a vaccination drive at such a massive scale was never conducted in history. There are over 100 countries having less than 3 cro

Masterminds: Masterclass on World Affair with Sreeram Chaulia





Archives

Current Issue

Opinion

Facebook    Twitter    Google Plus    Linkedin    Subscribe Newsletter

Twitter