RESTORING FINANCIAL HEALTH OF INDIAN PUBLIC SECTOR BANKS: A REVIEW OF PROMPT CORRECTIVE ACTION PLAN

Savitha Balasubramanian

Abstract


The Indian banking industry in recent times has been plagued by the ailing health of Public sector banks which dominate the credit space in the economy. The increase in stressed assets of Public sector banks accompanied by the threat of some banks breaching the minimum capital norms in 2017 forced the government and Reserve Bank of intervene and breathe life into these public sector banks using the recapitalisation and Prompt corrective action plan. Public sector banks constitute a major portion of the banking Industry in India and maintenance of their financial health is of utmost significance for the robustness of the economy with regard to credit and economic growth. The present research paper analyses the consistency of performance of public sector Banks that have been referred to under the Prompt corrective Action Plan using Key banking Indicators and also reviews the reforms that the Reserve bank of India has tried to initiate to strengthen the Banking Sector.


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ISSN : 2251-1547