Question
Which of the following are parameters for evaluating whether the bank (Scheduled Commercial Bank) is to be brought under the ambit of Prompt corrective action or not?
Which of the following are parameters for evaluating whether the bank (Scheduled Commercial Bank) is to be brought under the ambit of Prompt corrective action or not?
A. Common Equity Tier 1
B. NNPA
C. Tier 1 Leverage Ratio
D. Net Stable Funding ratio and Liquidity Coverage Ratio
Read the following passage and answer the next 5 question Central Bank along with a clutch of other lenders was placed under RBI's prompt corrective action (PCA) in 2017 after the regulator found some state-run lenders were in breach of its rules on regulatory capital, bad loans and leverage ratios. Since then all the lenders except Central Bank have improved their financial health and come off RBI's PCA list. A bank under PCA faces greater scrutiny by the regulator and may face lending and deposit restrictions, branch expansion and hiring freezes and other limitations on borrowings. The RBI introduced these norms at a time when Indian lenders were battling record levels of soured assets, prompting the RBI to tighten thresholds. Source: economictimes
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