........What makes the situation worrisome for state-owned banks is the inadequate provisioning for these bad loans. In 2009, the Reserve Bank of India (RBI) had made it mandatory for banks to put aside Rs 70 for every Rs 100 that had become an NPL. Last April, the central bank unexpectedly relaxed the norms on this provisioning coverage ratio (PCR), under which banks were not required to maintain a PCR of 70 per cent for bad loans after September 2010..............
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