The Reserve Bank of India (RBI) has imposed a ‘prompt corrective action’ against state-owned Oriental Bank of Commerce.
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- The action is taken for high bad loans.
- Various restrictions on the public sector lender including on fresh loans and dividend distribution will be placed.
- Net NPA of the bank rose to 9.56% of net advances as of June against 8.11% a year ago.
- The RBI took similar action against IDBI Bank, Indian Overseas Bank and UCO Bank.
What is Prompt Corrective Action?
Reserve Bank of India (RBI) has issued a policy action (first in May 2014 and revised effective from April 1, 2017) in the form of prompt corrective action (PCA) framework. When a bank have low capital adequacy or high Non- performing assets, which are specified as trigger point; in such case, RBI takes a corrective action. ..Read More
