NEW DELHI: Shares of Indian Overseas Bank on Thursday jumped 20 per cent after the Reserve Bank removed it from the Prompt Corrective Action Framework (PCAF).
The stock zoomed 20 per cent to Rs 24.60 on the BSE.At the NSE, it gained 19.80 per cent to Rs 24.50. The Reserve Bank on Wednesday removed Indian Overseas Bank from the Prompt Corrective Action Framework (PCAF), following improvement in various parameters and a written commitment that the state-owned lender will comply with the minimum capital norms.
On a review of the performance of the IOB, the Board for Financial Supervision on the basis of the published financial results for 2020-21, found that the bank was not in breach of the PCA parameter, the RBI said in a statement.
The bank has provided a written commitment that it would comply with the norms of Minimum Regulatory Capital, Net NPA and Leverage ratio on an ongoing basis, it added.
The lender has also apprised the RBI of the structural and systemic improvements that it has put in place, which would help the bank in continuing to meet these commitments.
"Taking all the above into consideration, it has been decided that Indian Overseas Bank is taken out of the PCA restrictions subject to certain conditions and continuous monitoring," the central bank added. IOB was placed under PCA in 2015.