The Reserve Bank of India (RBI) today said IDBI Bank will be removed from the prompt prompt corrective action (PCA) framework after improvement in the bank's overall performance.
This is subsequent to the assessment of the bank by the Board for Financial Supervision (BFS) in its meeting held on February 18, 2021, the RBI said.
"It was noted that as per published results for the quarter ending December 31, 2020 the bank is not in breach of the PCA parameters on regulatory capital, Net NPA and Leverage ratio," the RBI said.
Also, the lender has given in writing that it would stick to the minimum regulatory capital requirements, net NPA and leverage ratio on an ongoing basis and has informed the central bank of the structural and systemic improvements that it has put in place which would help the bank in continuing to meet these commitments, the RBI said.
"Taking all the above into consideration, it has been decided that IDBI Bank Limited be taken out of the PCA framework, subject to certain conditions and continuous monitoring, the RBI said.
IDBI Bank was put under the PCA framework in May 2017. And all banks under PCA are closely monitored in terms of financial parameters including asset quality, capital ratios and and profitability.
For the December ended quarter of FY21, the bank posted a net profit of Rs. 378 crore on the back of healthy growth in interest income. In the year ago period, the bank posted standalone net loss of Rs. 5763 crore.