In a Circular written to the Chief Executive Officer of Primary Urban Co-operative Banks RBI has asked them to report Large Exposures to Central Repository of Information on Large Credits. On this occasion, RBI also reminds UCBs of its earlier circular on the issue.
“It has been decided that Primary (Urban) Co-operative Banks (UCBs) having total assets of Rs 500 crore and above as on 31st March of the previous financial year shall report credit information, including classification of an account as Special Mention Account (SMA), on all borrowers having aggregate exposures of Rs 5 crore and above with them to Central Repository of Information on Large Credits (CRILC) maintained by the Reserve Bank”, the letter reads.
Special Mention Account (SMA) is an account which is exhibiting signs of incipient stress resulting in the borrower defaulting in timely servicing of her debt obligations, though the account has not yet been classified as NPA as per the extant RBI guidelines.
As early recognition of such accounts will enable banks to initiate timely remedial actions to prevent their potential slippages into NPAs, it is advised that UCBs having total assets of Rs 500 crore and above as on 31st March of the previous financial year shall take necessary steps to classify loans/advances accounts as SMA, as under:
To start with, UCBs will be required to submit CRILC Report on a quarterly basis with effect from December 31, 2019. Detailed operating instructions will be issued shortly by Department of Supervision, Reserve Bank of India.
UCBs should take utmost care about data accuracy and integrity while submitting the information /data on large credit to RBI, failing which penal action as per the provisions of the Banking Regulation Act, 1949 may be taken.
The Reserve Bank has created a Central Repository of Information on Large Credits (CRILC) of scheduled commercial banks, all India financial institutions and certain non-banking financial companies with multiple objectives, which, among others, include strengthening offsite supervision and early recognition of financial distress.
With a view to building a similar database of large credits extended by primary (urban) co-operative banks (UCBs), it has been decided to bring UCBs with assets of Rs 500 crores and above under the CRILC reporting framework.
