Centre may revamp framework for setting state-owned banks' targets

New framework could be on lines of earlier 'Statement of Intent' used to fix annual targets, will monitor performance on parameters such as return on assets, NPA, financial inclusion initiatives

The Centre may revamp the target-setting mechanism for public sector banks (PSBs) and is looking to come up with a fresh framework to monitor the performance of state-owned lenders. The new framework could be on the lines of ‘Statement of Intent’ (SoI) the government used to sign with PSBs to fix their annual targets.

If implemented, the new framework will monitor the performance of these banks based on parameters such as return on assets (RoA), reducing non-performing assets (NPA), efforts taken to improve financial inclusion, customer-centric initiatives, among others, an official said.

Through EASE 5.0, the common reforms agenda for PSBs, state-owned