RBI places Bank of India under prompt corrective action framework

The Reserve Bank of India, vide letter dated December 19, 2017, has placed Bank of India under prompt corrective action framework.

The RBI has placed prompt corrective action framework consequent to the onsite inspection under the risk based supervision model carried out for the year ended March 2017. This is in view of high net NPA, insufficient CET1 capital and negative return on asset for two consequent years.

The prompt corrective action would ensure overall improvement in risk management, asset quality, profitability, efficiency, etc of the bank.

The Bank reported net NPA ratio of 6.5% in H1FY18 which has improved as compared to 7.6% in H1FY17. The CRAR and CET-1 stand at 12.2% and 7.2% respectively, in H1FY18. The Return on Asset for FY16 and FY17 are -0.94% and -0.24% respectively on account of provisioning of stressed assets. The Net Interest Margins (NIM) in H1FY18 stood at 2.07%.

The stock is trading at a price of Rs174.45, down by 3.75% or Rs6.80, on NSE at 3.15pm.
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