Reserve Bank of India provided relief to a large number of banks by permitting lenders to include write-offs while increasing the provisioning coverage ratio (PCR) to 70 percent.

Technical or prudential write-offs are the amount of non-performing loans in the books of the branches, but yet to be written off at the head office. RBI said the amount of technical write-offs would have to be certified by statutory auditors.

In the July-September quarter review, the central bank had directed the public sector banks to increase the provisioning requirements for NPAs to provide a better cushion against losses.

RBI allowed banks to include floating provisions that were not included in Tier-II capital while calculation of PCR.

Bankers had requested the regulator to extend the deadline and include technical write-offs in the PCR.

A PCR without the inclusion of technical write-offs would have resulted in State Bank of India keeping aside another Rs. 5,000 crore for bad debts by September 2010, while ICICI would have been required to set aside an additional 1,700 crore for four quarters. Canara bank would have provided Rs 1,000 crore more.

Senior officials of government-owned banks said that inclusion of technical write-offs while calculating the coverage ratio would reduce pressure on banks. RBI, however, kept quiet on how many years' write-offs should be considered while computing the ratio.