UCO Bank, IDBI Bank, Central Bank approach RBI for permission to exit PCA framework

UCO Bank, IDBI Bank and Central Bank of India have sought permission from the RBI in order to exit the prompt corrective action (PCA) framework, informed sources.
The three banks were placed under the PCA framework, which imposes partial restrictions on loan disbursements, after a huge asset quality deterioration, losses in the books and lower capital levels.
According to the sources, the IDBI Bank has met all but one of the criteria for coming out of PCA. The bank’s return on assets (ROA) was negative at -7.63% for the quarter ended December 2019, while the RBI’s PCA framework requires the ROA to be above 0.25%. But the bank’s net non-performing assets (NPAs) remained at 5.25% in the December quarter – below the 6% threshold set by RBI.