11 Banks under RBI watch list: Secretary (FS)
Published: Aug 16, 2018
By TIOLCORPLAWS News Service
NEW DELHI , AUGUST 16, 2018: The Financial Services Secretary Mr Rajiv Kumar told today that the banks would come out of the Prompt Corrective Action (PCA) framework this fiscal, asserting that the worst is behind for state-owned lenders.
As many as 11 out of 21 banks are under the RBI's watch list. Of these, two banks - Dena Bank and Allahabad Bank, are facing restriction on expansion of business. Various measures taken by the govt including implementation of Insolvency and Bankruptcy Code (IBC) had yielded good results in terms of reining bad loans and increasing recovery.
Mr Kumar further said that the cleaning of balance sheets has put worst behind and banks had made recovery of Rs 36,551 cr during the first quarter registering a 49 % growth over the last fiscal. At the same time, operating profit has risen by 11.5 % while losses fell 73.5 % on quarter on quarter basis, he said, adding asset quality has been addressed through falling NPA slippage.
According to Mr Kumar, the Provision Coverage Ratio of banks had reached a healthy level of 63.8 %.
