Public Sector Banks not being shut: RBI

Prompt Corrective Action (PCA) framework is not intended to constrain normal operations of the banks for the general public, said RBI

GN Bureau | December 22, 2017


#RBI   #Reserve Bank of India   #PSB  


The Reserve Bank of India (RBI) on Friday scotched rumours and said that Public Sector Banks are not being shut down.

“The RBI has come across some misinformed communication circulating in some section of media including social media, about closure of some Public Sector Banks in the wake of their being placed under the Prompt Corrective Action (PCA) framework,” said a statement.

Citing a June 5, 2017 press release, it said: “The Reserve Bank has clarified that the PCA framework is not intended to constrain normal operations of the banks for the general public.

“It is further clarified that the Reserve Bank, under its supervisory framework, uses various measures/tools to maintain sound financial health of banks. PCA framework is one of such supervisory tools, which involves monitoring of certain performance indicators of the banks as an early warning exercise and is initiated once such thresholds as relating to capital, asset quality etc. are breached.

“Its objective is to facilitate the banks to take corrective measures including those prescribed by the Reserve Bank, in a timely manner, in order to restore their financial health. The framework also provides an opportunity to the Reserve Bank to pay focussed attention on such banks by engaging with the management more closely in those areas. The PCA framework is, thus, intended to encourage banks to eschew certain riskier activities and focus on conserving capital so that their balance sheets can become stronger.”

It added that the PCA framework has been in operation since December 2002 and the guidelines issued on April 13, 2017 is only a revised version of the earlier framework.

Comments

 

Other News

America loves India, America respects India: Trump

America loves India, America respects India, said US president Donald Trump as he and first lady Melania Trump began their short visit of India from Ahmedabad on Monday, welcomed by prime minister Narendra Modi. The US president was in Ahmedabad, in Modi`s home state of Gujarat, to attend th

2020 is crucial for CPSE: Arjun Ram Meghwal

"The year 2020 is going to be a significant year for India and especially for Central Public Sector Enterprises (CPSE), "said the Arjun Ram Meghwal, Minister of State for heavy industries and public enterprises on Wednesday at the 7th PSU Awards and Conference organised by Governance Now on 19th

Vice President springs surprise, speaks in 22 languages

Highlighting the importance of preserving, protecting and promoting Indian languages, the vice president of India, Shri M Venkaiah Naidu spoke in 22 languages at an event to mark International Mother Language Day in New Delhi. He urged all the citizens to take a pledge to promote mother tongue and also lea

Title Insurance: new product for old issues

Real estate is among the priciest investments around. More so for the common man who has to live with the burden of monthly EMIs. Yet, it is an art to discover the real owner of any property. Government and revenue records, which are easily accessible to the public, are not properly maintained. Individual

Aadhaar linkage with electoral roll on cards

The election commission of India (ECI) has been working on a series of electoral reforms, and the agenda includes linking Aadhaar with the electoral roll, considering paid news and false affidavit as electoral offence/corrupt practice, better monitoring the role of print media and social media intermediari

Save Panje wetland, give it Ramsar status: environmentalists

To protect the fast depleting wetlands against being used as landfill and for development activities in Mumbai metropolitan region (MMR), environmentalists have asked the centre to declare the 289-hectare Panje wetlands in Uran tehsil of Raigarh district as a ‘Ramsar site’ and preserve its ecol



Archives

Current Issue

Video

CM Nitish’s convoy attacked in Buxar

Opinion

Facebook    Twitter    Google Plus    Linkedin    Subscribe Newsletter

Twitter