NEW DELHI: The government will hold a review meeting on May 17 of state-run banks that are under the Reserve Bank of India’s prompt corrective action (PCA) framework. At present, there are 11 banks under PCA on account of poor performance.
“A review meeting has been called for some of the weak banks next week, where we will discuss their progress to catch up with their peers and impediments in their growth,” said financial services secretary Rajiv Kumar.
Dena Bank, Central Bank of India, Bank of MaharashtraNSE -0.73 %, UCO Bank, IDBI Bank, Oriental Bank of Commerce, Indian Overseas Bank, Corporation Bank, Bank of India, Allahabad BankNSE -0.65 % and United Bank of India are under the RBI’s PCA framework.
In January, the government had announced its Enhanced Access and Service Excellence (EASE) reform agenda under which banks will need to set up specialised monitoring agencies for loans above 250 crore and a separate vertical for non-performing assets (NPAs), apart from selling non-core assets and rationalising overseas businesses. They also need to have a minimum 10% exposure in consortium loans to prevent a situation in which too many lenders are involved when it comes to debt resolution.
GST on bank services
The Department of Financial Services (DFS) has also decided to approach the revenue department to clear confusion over levy of goods and services tax on some of the free services like free cheque books, ATM withdrawal offered by banks to its customers. – Our Bureau
“This issue of imposition of GST on some of the free services offered by banks to its customers will be taken up with the revenue department and we hope to resolve the issue soon,” Kumar said.
The department is of the opinion that issuance of cheque book, account statements, certain ATM withdrawal and other free services are not commercial activities which can be brought under the ambit of GST, he added.
Indian Banks’ Association on behalf of the management of banks have already made representation to the tax authorities.