PCA Prompt Corrective Actions framework is triggered when a bank breaches 1 ...........

Economic Affairs Types of Banks and Banking

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PCA (Prompt Corrective Actions) framework is triggered when a bank breaches

1. Minimum Capital

2. Return on Asset

3. Quantum of non-performing assets

Select the correct answer using the code given below

1 only

2 and 3 only

1 and 3 only

1, 2, and 3

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Explanation:

To ensure that banks don't go bust, RBI has put in place some trigger points to assess, monitor, control and take corrective actions on banks which are weak and troubled The process or mechanism under which such actions are taken is known as Prompt Corrective Action, or PCA The PCA is triggered when banks breach certain regulatory requirements like minimum capital, return on asset and quantum of non-performing assets.