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    Question

    Read the following passage and answer the next 5 question Central Bank along with a clutch of other lenders was placed under RBI's prompt corrective action (PCA) in 2017 after the regulator found some state-run lenders were in breach of its rules on regulatory capital, bad loans and leverage ratios. Since then all the lenders except Central Bank have improved their financial health and come off RBI's PCA list. A bank under PCA faces greater scrutiny by the regulator and may face lending and deposit restrictions, branch expansion and hiring freezes and other limitations on borrowings. The RBI introduced these norms at a time when Indian lenders were battling record levels of soured assets, prompting the RBI to tighten thresholds. Source: economictimes

    The current PCA Framework was revised in which year?

    A 2011 Correct Answer Incorrect Answer
    B 2014 Correct Answer Incorrect Answer
    C 2017 Correct Answer Incorrect Answer
    D 2020 Correct Answer Incorrect Answer
    E 2021 Correct Answer Incorrect Answer

    Solution

    The existing PCA Framework for SCBs has since been reviewed and revised with a circular dated Nov 02.2021 The provisions of the revised PCA Framework will be effective from January 1, 2022. The PCA framework will be reviewed after 3 years . In India, PCA framework was first introduced in 2002 , during the period ofRBI Governor Bimal Jalan, along the lines of the Federal Deposit Insurance Corp.’s (FDIC) PCA framework.

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