Financial services secretary Rajiv Kumar on Friday said that the government is not looking for relaxation in the Reserve Bank of India’s prompt corrective action (PCA) framework but hinted that the central bank should bring down the capital requirement norms and align with Basel III norms There is no easing that will be required, there is no case for easing of any norm what is being talked about what is required is aligning it with best international practices, he said when asked if the government wants RBI to relax the PCA framework. At present, minimum common equity (CET) Tier I ratio as prescribed by RBI stands at 5.5% as against 4.5% under Basel III norms. On the issue of liquidity crunch mostly for non-banking finance companies, Kumar said that government is concerned about both liquidity and asset quality concerns.
Government wants RBI to bring down capital requirements and align with Basel III norms
