UCO Bank Current Affairs - 2020
It is said that the finance ministry and the Reserve Bank of India are working on providing some relaxation on the prompt corrective action (PCA) framework for stressed banks.
Prompt Corrective Action (PCA) Framework
Prompt Corrective Action (PCA) framework has been issued by the RBI to maintain the sound financial health of banks. The RBI will initiate certain structured and discretionary actions for the bank under the PCA. The PCA framework kicks in when the Banks breach any of the three key regulatory trigger points
- Capital to risk-weighted assets ratio
- Net non-performing assets
- Return on assets.
The PCA framework is aimed at nudging the banks to take corrective measures in a timely manner, in order to restore their financial health.
Eleven Banks which are under PCA framework are Dena Bank, Central Bank of India, Bank of Maharashtra, UCO Bank, IDBI Bank, Oriental Bank of Commerce, Indian Overseas Bank, Corporation Bank, Bank of India, Allahabad Bank and United Bank of India.
Why there is a proposal for providing relaxation now?
After several measures taken for capital infusion in the Public Sector Banks, the Banks are well-capitalised. Even though the banks have not only shown improvement on recoveries but have further de-risked their portfolios. The relaxation would aid banks in exiting the PCA framework.
The Parliamentary Committee on Finance had observed that “It is not clear as to how these banks will turn around their operations with the existing curbs on lending and even deposit-taking in the case of some. This could trigger a vicious cycle in the banking sector and the economy at large”. The committee had recommended reviewing the PCA framework.
Tags: Allahabad Bank • Bank of India • Bank of Maharashtra • Central Bank of India • Corporation Bank
Iran has requested the Ministry of Finance and the Reserve Bank of India (RBI) to allow it to open accounts in multiple banks to facilitate better non-oil trade between the two nations.
As per Iran’s Ambassador Gholam Reza Ansari, Iran is looking at diversifying its economic relations with India through joint ventures, investments and technology transfer. It wants to strengthen relations with India by having multiple bank accounts to boost non-oil trade.
- For this, it has a proposal to build north-south rail corridor in Iran which would boost trade in the region.
- The UCO Bank account is for oil transactions and there is a need for multiple channels, as the trade relations between the two nations extend beyond oil.
- For all oil imports from Iran since July 2011, India has been paying 55 % of the amount in Euros through Ankara-based Halkbank. The remaining money is being remitted in rupees in Kolkata-based UCO Bank.
Note: Presently, only UCO Bank facilitates oil related transactions with Iran.
Tags: Current Affairs 2014 • IBPS • India-International Relations • India-Iran • Iran