Indian regulations on capital requirements, provisioning for sour assets and prompt corrective action (PCA) restricting regular activities by lenders are conservative and rule-based, SBI’s research wing said in a report. It did not call for any relook in the report which comes amid a heated debate between the government and the RBI over such aspects. “Whether a rule-based or a discretion-based approach works better remains a matter of empirical debate till date,” it said.
