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      Question

      Which of the following Statements is/are True? I-

      PCA is a framework under which banks with weak financial metrics are put under watch by the RBI. II- The RBI introduced the PCA framework in 2002.                          III- It aims to check the problem of Non-Performing Assets (NPAs) in the Indian banking sector.
      A Only I Correct Answer Incorrect Answer
      B Only II Correct Answer Incorrect Answer
      C Only III Correct Answer Incorrect Answer
      D I & II Correct Answer Incorrect Answer
      E All of the above Correct Answer Incorrect Answer

      Solution

      PCA is a framework under which banks with weak financial metrics are put under watch by the RBI. The RBI introduced the PCA framework in 2002 as a structured early-intervention mechanism for banks that become undercapitalised due to poor asset quality, or vulnerable due to loss of profitability. It aims to check the problem of Non-Performing Assets (NPAs) in the Indian banking sector.

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