Category: Prudential Norms

Seventh Bi-monthly Monetary Policy Statement, 2019-20 – Resolution of the Monetary Policy Committee (MPC) Reserve Bank of India

A day after Modi govt began its economy rescue in right earnest with a Rs 1.70 lakh crore coronavirus counter, the Reserve Bank of India joined the big fight today with a host of measures aimed at minimising the damage from Covid-19.
These measures come just hours after Moody’s Investors Service cut India’s growth forecasts for 2020 calendar year to 2.5% from 5.3%. The MPC decided by 4-2 majority to reduce repo rate by 75 basis points to 4.4 per cent. The reverse repo rate was cut by 90 bps to 4 per cent, creating an asymmetrical corridor.

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Reporting of Large Exposures to Central Repository of Information on Large Credits (CRILC) – UCBs

RBI decided that Primary (Urban) Co-operative Banks (UCBs) having total assets of ₹500 crore and above as on 31st March of the previous financial year shall report credit information, including classification of an account as Special Mention Account (SMA), on all borrowers having aggregate exposures of ₹5 crore and above with them to Central Repository of Information on Large Credits (CRILC) maintained by the Reserve Bank. Aggregate exposure shall include all fund-based and non-fund based exposure, including investment exposure on the borrower.

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Prudential Framework for Resolution of Stressed Assets

Reserve Bank of India has issued a new framework on 7th June 2019 for resolution of bad loans, replacing the previous norms quashed by the Supreme Court in April, offering a 30-day gap for stress recognition instead of the one-day default earlier. The apex court had on April 2 struck down the stringent RBI circular, issued…

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