New Delhi : Reserve Bank of India (RBI) recently changed its measures and upgraded guidelines for prompt corrective action (PCA).
According to new guidelines, if a bank reaches the ‘risk threshold 3’ category, it will be a likely candidate for recovery measures such as amalgamation, reconstruction and winding up.
“A bank will be placed under PCA framework based on the audited annual financial results and the supervisory assessment made by RBI. However, RBI may impose PCA on any bank during the course of a year (including migration from one threshold to another) in case the circumstances so warrant,” RBI said.
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