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

Four trends that will shape healthcare post-Covid

The Covid-19 pandemic has disrupted economies and healthcare systems across the world. Even in the countries like the US that have the highest spend on healthcare and public health emergency preparedness, the impact of coronavirus pandemic on health and livelihoods of people has been tremendous. There are

India to play leading role in global revival: Modi

India would play a leading role in the global revival, prime minister Narendra Modi said on Thursday, as he addressed the inaugural session of India Global week via video-conference. He said that this is closely linked with two factors. “First is - Indian talent and second is India`s

BMC spells out numbers to counter Fadnavis’ claims

The BrihanMumbai municipal corporation (BMC) has countered Maharashtra leader of opposition Devendra Fadanvis’s suspicions of fewer Covid-19 tests, as it outlined various measures it has adopted since the first test conducted on February 3, and how it has gradually brought down the number of cases in

Mumbai opts for “most liberal Covid-19 testing” in the world

As part of the four T strategy of trace-test-track-treat, Mumbai – the most affected city in India – has decided to make Covid-19 tests accessible to all. The municipal corporation of Greater Mumbai (MCGM) has come out with guidelines allowing all laboratories to conduct RT-PCR (

Exit the Dragon, Enter the Tiger

In a major development on July 6, the Chinese army started moving back its tents, vehicles as well as troops from locations where disengagement was agreed upon in eastern Ladakh’s Galwan Valley. This is a significant milestone in regional geopolitics with India having been successful in isolating the

Hiranandani Group launches ambitious data centre project

With the Covid-19 pandemic pushing more online activity and the capacity usage of data centres going up, India’s largest data centre (DC) building and the biggest tier-IV data centre, Yotta NM1,the  second largest in the world, has been launched in Mumbai. The launch event on Tue



Archives

Current Issue

Opinion

Facebook    Twitter    Google Plus    Linkedin    Subscribe Newsletter

Twitter