CrackitToday App

Prompt Corrective Action Framework : RBI

Kumari Sonali

Prompt Corrective Action Framework : RBI

The Reserve Bank of India (RBI) has introduced a Prompt Corrective Action (PCA) framework for Urban Cooperative Banks (UCBs).

  • This framework aims to enable timely supervisory intervention and ensure UCBs implement necessary remedial measures to restore their financial health.
  • It replaces the existing Supervisory Action Framework (SAF) last revised in January 2020.
  • The new PCA framework is designed to provide flexibility by allowing entity-specific supervisory action plans based on individual risk assessments.
  • It aligns with similar frameworks for Scheduled Commercial Banks and Non-Banking Financial Companies while maintaining supervisory rigor.
  • The revised framework focuses on capital, asset quality, and profitability, particularly targeting larger UCBs for intensive monitoring.
  • It will not apply to small Tier 1 UCBs. The RBI has categorized UCBs into four tiers for regulatory purposes.

...Read more on our test console

...Read these too

  • Prompt Corrective Action Framework

    Prompt Corrective Action Framework: Reserve Bank of India has removed the Central Bank of India from its Prompt Corrective Action Framework (PCAF) after the lender showed improvement in various financial…

  • What is Prompt Corrective Action Framework of RBI?

    Prompt Corrective Action Framework: The Reserve Bank of India has taken IDBI Bank Ltd out of its prompt corrective action list after it found the state-run lender was not in…

  • Prompt Corrective Action (PCA) Framework: RBI

    Prompt Corrective Action (PCA) Framework: RBI The Reserve Bank of India (RBI) has announced a revised Prompt Corrective Action (PCA) framework. The PCA framework enables supervisory intervention of RBI over…