UCO Bank is likely to restructure retail and MSME loans to the tune of ₹1000 crore by June this year, under the Reserve Bank of India’s Resolution Framework 2.0.

According to Atul Kumar Goel, MD and CEO, UCO Bank, close to 2,314 accounts amounting to ₹127 crore have been restructured under the framework so far.

The Resolution Framework 2.0 was announced by the RBI on May 5 to help small borrowers tide over the impact of the second Covid-19 wave and State-level lockdowns.

“It is still premature to say what would be the actual amount of restructuring but it is likely to be more than last year. We had restructured personal loans amounting to ₹92 crore and MSME loans worth ₹281 crore last year,” Goel told newspersons at a virtual press meet on Monday.

Goel expects credit demand to pick up following unlocking in various States. The bank is hopeful of registering 7-10 per cent growth in credit during the current fiscal. It had posted a credit growth of around three per cent in FY21.

“I am hopeful that there will be a good demand for credit on account of unlocking in all states. We have witnessed a credit growth of around ₹2000 crore so far during the current fiscal,” he said.

PCA framework

UCO Bank is hopeful of coming out of RBI’s prompt corrective action (PCA) framework. Having complied with all key regulatory parameters during the quarter-ended March 31, 2021, the bank has written to the central bank urging it to consider withdrawing PCA.

PCA is triggered when banks breach certain regulatory requirements such as minimum capital, return on asset and quantum of non-performing asset.