Central Bank may close its 600 branches, decision is possible to improve financial health

Central Bank may close its branches

There are 4,594 branches in the bank’s network. According to a government source, the bank is proceeding on a strategy to improve the economic situation by removing its loss-making assets. The NPAs of the bank remain very high as compared to other banks. The gross NPAs of the bank stood at 15.16 per cent during the December quarter.

central bank (central bank) can take some tough steps in the coming time to improve its turbulent financial situation. According to a Reuters report, the bank is working on a plan to reduce the number of its branches by 13 percent. Actually the bank is working on a plan to reduce the cost to improve its financial condition. In which a large number of banks are proposed to close their branches or merge the loss making branches with other branches. Along with this, the bank is also considering the sale of non-core assets. The financial health of the bank has been under pressure for the last several years. At present the bank is included in the PCA list of RBI.

Considering closing about 600 branches

The Reuters report wrote that information obtained from sources and looking at documents related to this decision has revealed that the bank is planning to close about 600 branches or merge them with other branches. The bank plans to reduce the number of branches by March 2023. Along with this, a government source has informed that the bank is also planning to sell non-core assets including real estate. The bank is continuously planning to strengthen its financial position, although this is the first time when the talk of branch closure is coming to the fore. There are 4,594 branches in the bank’s network. According to a government source, the bank is proceeding on a strategy to improve the economic situation by removing its loss-making assets. The NPAs of the bank remain very high as compared to other banks. The gross NPAs of the bank stood at 15.16 per cent during the December quarter.

Banks included in RBI’s PCA list

The Central Bank along with some other banks had joined the PCA (prompt corrective action) list of the Reserve Bank from the year 2017. This action was taken on these banks due to non-compliance of rules in many other cases including bad loans. Banks have to face many restrictions when they come in the PCA list. Along with this, the Reserve Bank also keeps a close watch on their functioning. In a document sent by the bank to its branch, based on which Reuters has reported, the bank has written that due to poor performance on profits and more efficient use of employees, the bank has been removed from the Reserve Bank’s PCA list since 2017. Trying to come out. At present, except the Central Bank, all other banks have come out of this list.