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RBI withdraws corrective restrictions on IDBI Bank with riders

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

twitter-logoBusinessToday.In | March 10, 2021 | Updated 21:07 IST
RBI withdraws corrective restrictions on IDBI Bank with riders
RBI said the action is subject to certain conditions and continuous monitoring

The Reserve Bank of India has taken IDBI Bank out of the Prompt Corrective Action (PCA) framework, four years after the banking regulator placed restrictions on the state-run lenders. The moves, however, is subject to "certain conditions and continuous monitoring", the apex bank stated.

"The performance of IDBI Bank Limited, currently under the Prompt Corrective Action Framework (PCAF) of RBI, was reviewed by the Board for Financial Supervision (BFS) in its meeting held on February 18, 2021. 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 central bank said in a notification on Wednesday.

"The 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 further stated.

RBI said that considering all of this, it has decided to take IDBI Bank out of the PCA framework, subject to certainconditions and continuous monitoring. However, it did not list the conditions.

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