Canara, Union Bank, PNB among possible candidates; may lead to recall of Rs 157-bn AT-1 bonds Five public sector banks (PSBs), including Canara and Union Bank of India, are on the brink of being put under the Reserve Bank of India’s (RBI’s) prompt corrective action (PCA) plan. According to rating agency Icra, their net non-performing assets (NPAs) rose above 6 per cent in December 2017. If the banking regulator places them under PCA, the action may drive these banks to recall additional tier-1 (AT-1) bonds, which is included in Tier-1 capital, of Rs 157 billion from investors. Besides Canara and Union Bank, three other PSBs that may come under PCA are Andhra Bank, Punjab National Bank, and Punjab & Sind Bank. While taking the decision on putting a bank under PCA, the RBI assesses its standing on three counts, namely capital adequacy ratio (CAR), net NPAs, and return on assets (RoA). Banks become PCA candidates when they feel the minimum requirements of CAR ...