InvestorQ : What does it mean that UCO Bank is out of PCA framework?
prachi Patwardhan made post

What does it mean that UCO Bank is out of PCA framework?

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sara Kunju answered.
3 months ago
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As was expected, the RBI has removed UCO Bank from the Prompt Corrective Action framework or PCA as it is known in short. UCO Bank was put under the PCA framework in 2017. Normally, a bank is put under PCA when their net NPAS tend to spiral out of control. Banks under PCA will typically need approval for most decisions, they cannot expand their loan books, recruit officers, give pay hikes to senior management and they are also not allowed to declare dividends till they come out of the PCA framework.

With the RBI removing UCO Bank from PCA, it can focus on expanding its lending book and also look to expand its network and its manpower needs. Net NPAs of UCO Bank are down from 8.54% in Mar-17 to 3.94% currently, which has propelled this shift out of PCA. UCO Bank also posted net profits in the recent fiscal ended March 2021. Government already infused Rs.2,600 crore into UCO Bank capital this year, and it can make aggressive plans.

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