RBI to impose fines on banks with poor progress

The Reserve Bank of India (RBI) may impose heavy penalties on banks, and stipulate higher provisioning for stressed loans following a supervisory review of its June 7 circular. And, in a first-of-its-kind move, chief executive officers (CEOs) and senior management of banks could also be held liable for lack of progress.

Daily Current Affairs Quiz 2020

RBI indicated that banks can start the resolution of stressed loans less than Rs.1,500 crore without waiting for a formal notification. It also mentioned that the 7 June 2019 circular was only applicable for stressed accounts in excess Rs.2,000 crore. RBI review of 7 June circular notes Inter-creditor Agreement (ICA) (of 13 banks) yet to be signed for exposures amounting to Rs.3,610 crore.