RBI puts 4 PSBs under watch on asset quality concerns
|Source: The Hitavada Date: 24 Mar 2017 10:02:22|
THE Reserve Bank has put four public sector lenders, including IDBI Bank and Indian Overseas Bank, under watch and advised them to stay off risky assets so that their financial health is not stressed further. While UCO Bank also figures in the list, the name of the fourth lender could not be immediately ascertained.
Sources said these lenders were on the RBI’s radar as their financial health might not improve after the central bank’s asset quality review (AQR) came to an end on March 31. These banks had been advised by both the Finance Ministry and the RBI to improve their financials, look for avenues for capital infusion and create a self-sustaining model by selling assets, they added.
Queries sent to the RBI did not elicit any response, while no comments were available from the four lenders. The RBI had embarked on the AQR exercise from December 2015 and asked banks to recognise some top defaulting accounts as NPAs and provide for them. The move resulted in a spike in bad assets with lenders recognising over Rs 1 lakh crore of bad assets in the December quarter alone.