An analysis of United Bank of India and Indian Overseas Bank shows that RBI’s prompt corrective action does more harm. These 11 banks also hold close to ₹25 trillion worth of public deposits garnered across a massive network of over 30,000 branches. Their relevance is under debate because they are under the Reserve Bank of India’s (RBI) prompt corrective action (PCA). It is, essentially, a regulatory intensive care unit for sick banks with deep holes in their balance sheets. That is why PCA must be followed by other more critical measures for sick banks to become healthy.

Source: Mint June 04, 2018 06:56 UTC