MUMBAI, Sept 20 (Reuters) - The Reserve Bank of India on Tuesday said it has taken Central Bank of India CBI.NS, a state-owned commercial bank, off its prompt corrective action (PCA) list after it was found that the bank was not in breach of certain regulations.
Central Bank and several other lenders were placed under RBI's PCA framework in 2017 after the regulator found some state-run banks were in breach of rules on regulatory capital, bad loans and leverage ratios when Indian banks were battling high levels of bad loans.
The RBI said it was noted that as per the assessed figures of Central Bank for the year ended March 31, 2022, the bank is not in the breach of the PCA parameters.
"The bank has provided a written commitment that it would comply with the norms of minimum regulatory capital, net NPA and leverage ratio on an ongoing basis..." the RBI said.
Central Bank has also informed the regulator of structural and systemic improvements that it has put in place which will help the bank to continue to meet these commitments, the RBI said.
Central Bank, the last lender to come off RBI's PCA list, was placed under the PCA framework in June 2017 and in the quarter ending June 2017 the bank had reported a loss of 7.50 billion rupees while its gross bad loan ratio was at 17.27%.
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.
(Reporting by Nupur Anand; Editing by Jane Merriman)
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