Question

The Reserve Bank of India's Financial Stability Report (FS

  • R heavily monitors the "Provisioning Coverage Ratio" (PC
  • R of commercial banks. A high PCR signifies that:
A The bank is highly exposed to unhedged foreign exchange risks.
B The bank has set aside a larger proportion of its funds to cover potential losses from bad loans (NPAs).
C The bank's credit-to-deposit ratio has crossed safe macroprudential thresholds.
D The bank is heavily reliant on short-term call money markets.
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