Further, lower provisioning requirements were stipulated for Tier-I compared to Tier-II banks which is also intended to provide a measure of relief to the small UCBs, as lower provisioning would  BIS Review 111/2009  3  translate into higher profits that could, in turn, be used, during the transition period, to shore up the capital base of the banks.
b)  Consultative approach to supervision – TAFCUB  In order to address the problem of Dual Control, Reserve Bank in 2001-2002, suggested that a new Apex Supervisory body be constituted for the UCB sector, comprising representatives of Central / State Governments, RBI and experts from the field.