Hong Kong Monitary Authority tightens norms for Allahabad Bank branch, all details here
According to the bank, the authority has asked maintain high quality liquid asset in Hong Kong equivalent to 100% of unpledged deposits.
State-owned Allahabad Bank has informed that the Hong Kong Monitary Authority, while assessing the implications of the capital position of the bank as on March 2018 (CRAR-8.69%), 'has enhanced the supervisory arrangements on our Hong Kong Branch'.
According to the bank, the authority has asked to maintain high quality liquid asset in Hong Kong equivalent to 100% of unpledged deposits.
HKMA even guided Allahabad Bank should not proactively solicit customer deposits in Hong Kong. However, transactional deposits such as pledged deposits for commercial loans would be excluded from this supervisory arrangement.
Further, any Hong Kong branch of Allahabad Bank should maintain a position of 'net due to' its Head Office, other branches and any direct or indirect subsidiaries and associates of the bank.
Lastly, the authority said Allahabad Bank should not incur additional non-bank credit exposures.
It needs to be noted that Allahabad Bank was placed under RBI's prompt corrective action (PCA) scheme in January. The central bank directed the bank to restrict expansion of risk-weighted assets (RWA).
In last quarter of FY18, the bank witnessed a net loss of Rs 3,510 crore, while posting a net non-performing assets of 8.04%.
Today, Allahabad Bank's share price finished at Rs 45.70 per piece gradually down by 0.22% on BSE.
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