CURRENT AFFAIRS

Detailed explanation-1: -Background: PCA is a framework under which banks with weak financial metrics are put under watch by the RBI. The RBI introduced the PCA framework in 2002 as a structured early-intervention mechanism for banks that become undercapitalised due to poor asset quality, or vulnerable due to loss of profitability.

Detailed explanation-2: -Prompt Corrective Action (PCA)is a framework introduced by the Reserve Bank of India in 2022. The Prompt Corrective Action framework is a structured early-intervention mechanism for banks with weak financial records due to loss of profitability or poor asset quality.

Detailed explanation-3: -The Prompt Corrective Action Framework The PCA framework is intended to act both as a supervisory tool and a tool for effective market discipline to restore the financial health of the supervised entity in question.