India

RBI lifts UCO Bank out of corrective action list after four years

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Leaflets advertising loans are pictured inside a commercial branch of the UCO Bank in Mumbai June 1, 2013. REUTERS/Vivek Prakash (INDIA - Tags: BUSINESS)

BENGALURU, Sept 8 (Reuters) - The Reserve Bank of India said on Wednesday it had taken UCO Bank (UCBK.NS) out of its prompt corrective action (PCA) list after finding that the state-run lender was not in breach of its rules on regulatory capital, bad loans and leverage ratio.

UCO Bank was placed under the so-called PCA framework in 2017 due to its deteriorating financial health, at a time when Indian lenders battled record levels of soured assets, prompting the RBI to tighten thresholds.

The bank was no longer in breach of these PCA parameters as per its March-quarter results, the central bank said in a statement.

The RBI added that UCO Bank had committed to complying with its rules on an ongoing basis.

The central bank in March removed another state-run lender, IDBI Bank Ltd (IDBI.NS), from its PCA list.

Under RBI rules, prompt corrective action is triggered if a bank's net non-performing loans ratio crosses 6% or if the capital requirements to be maintained are breached.

Reporting by Nallur Sethuraman in Bengaluru and Nupur Anand in Mumbai; Editing by Arun Koyyur and Aditya Soni

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