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

What exactly is the true purpose of business?

Invaluable By Somik Raha IndiePress, 316 pages, Rs 701 From coding at age 12 to a deep dive into philoso

Yoga Day has changed perceptions about it in ten years: PM

The expanding awareness of Yoga over the past ten years has changed perceptions associated with it, prime minister Narendra Modi said in Srinagar on Friday on the occasion of the International Day of Yoga.   “Yoga is now emerging beyond limited boundaries. The world is witnessing t

Listening to tomorrow: The imperative for youth-driven data in India

Over a decade and a half ago when I was still a student, millennials felt the burning need to break down the barriers of gatekeeping in traditional media. Young voices, brimming with ideas and opinions, were often sidelined, their perspectives deemed too marginal or unrefined for mainstream discourse. This

Israel-Palestine War: Lessons from Past Peace Efforts

Israel-Palestine War: Give Peace a Chance By Dr. Joseph K. Thomas IndiePress, 243 pages, Rs 399 T

How inner work helps subvert painful narratives

Unashamed By Neha Bhat HarperCollins, 240 pages, Rs 499   * How do I connect better with my partner? *&nbs

Heatwave spikes power demand: measures taken to ensure supply

The Northern Region has been experiencing high power demand conditions due to a prevailing heat wave since May 17. Despite these challenging conditions, the highest ever peak demand of 89 GW in the Northern Region was successfully met on June 17. This achievement was made possible by import

Visionary Talk: Amitabh Gupta, Pune Police Commissioner with Kailashnath Adhikari, MD, Governance Now


Archives

Current Issue

Opinion

Facebook Twitter Google Plus Linkedin Subscribe Newsletter

Twitter