Acknowledging the improvement in performance of IDBI Bank, the Reserve Bank of India (RBI) has decided to take the bank out of prompt corrective action (PCA) framework. This follows a review of IDBI Bank Limited, by the Board for Financial Supervision (BFS) in its meeting held on February 18, 2021, the central bank said.
“It was noted that as per published results for the quarter ending December 31, 2020 the bank is not in breach of the PCA parameters on regulatory capital, Net NPA and Leverage ratio,” the RBI said.
IDBI Bank has provided a written commitment that it would comply with the norms of minimum regulatory capital, net NPA and leverage ratio on an ongoing basis and has 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, the RBI said.
“Taking all the above into consideration, it has been decided that IDBI Bank Limited be taken out of the PCA framework, subject to certain conditions and continuous monitoring, the RBI said. Under PCA, RBI closely monitors weak banks which slip below certain financial parameters such as capital ratios, asset quality and profitability.
