RBI removes lending curbs on UCO Bank

State-owned UCO Financial institution will now not be topic to strict lending curbs imposed in Might 2017, with the Reserve Financial institution of India (RBI) taking the lender out of the immediate corrective motion ( Prompt Corrective Action ) restrictions.

With this, solely two banks stay underneath PCA—Indian Abroad Financial institution and Central Financial institution of India.

The central financial institution makes use of the PCA framework to rein in banks that have breached sure regulatory thresholds in unhealthy loans and capital adequacy. PCA entails curbs on high-risk lending, setting apart extra money on provisions and restrictions on administration wage.

Reserve Bank of India has taken public sector lender UCO Bank out of the Prompt Corrective Action (PCA) framework on improvement in financial and credit profile. This decision gives the bank more freedom for lending, especially to corporations, and grows the network, subject to prescribed norms. The Kolkata-based lender was placed under PCA in May 2017 on account of high Net Net-Performing Assets (NPAs) and negative Return on Assets (RoAs).