Updated: September 30, 2021 10:07:47 am
The Reserve Bank of India (RBI) on Wednesday removed Indian Overseas Bank from the Prompt Corrective Action Framework.
IOB was placed under the PCA framework in 2015.
The Board for Financial Supervision, after review of IOB’s performance, on the basis of the published financial results for 2020-21 found that the bank was not in breach of the PCA parameter, the central bank said in a statement. The bank also provided a written commitment that it would comply with the norms of Minimum Regulatory Capital, Net NPA and Leverage ratio on an ongoing basis, it added.
The lender has also apprised the RBI of the structural and systemic improvements that it has put in place, which would help the bank in continuing to meet these commitments.
“Taking all the above into consideration, it has been decided that Indian Overseas Bank is taken out of the PCA restrictions subject to certain conditions and continuous monitoring,” the central bank added. PCA is triggered when banks breach certain regulatory requirements such as return on asset and quantum of NPA.
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