RBI has reviewed and revised the existing framework for SCB’s and also issued fresh PCA Framework for NBFC’s. The new PCA norms for SCB’s shall be effective January 1st, 2022 & for NBFC’s the PCA norms will be effective wef October 1, 2022.
Tag: NBFC
RBI had constituted an internal working group on 12 June to review extant ownership guidelines and corporate structure for Indian private sector banks.The internal working group of Reserve Bank of India (RBI) suggested that large Non-Banking Financial Company (NBFCs) can convert into banks if they fulfill certain criteria. “Well run large NBFCs, with an asset size of ₹50,000 crore and above, including those which are owned by a corporate house, may be considered for conversion into banks subject to completion of 10 years of operations and meeting due diligence criteria and compliance with additional conditions specified in this regard,” the central bank panel recommended.
The Government of India has approved a scheme to improve the liquidity position of NBFCs/HFCs through a Special Purpose Vehicle (SPV) to avoid any potential systemic risks to the financial sector.
RBI brings in norms to curb malpractices by lending apps. RBI had to bring in these norms as hundreds of lending apps have mushroomed over the past year or so. RBI has made banks or NBFCs directly responsible for the actions of the digital platforms they have tied up with. RBI said that digital platforms and lenders must make adequate efforts towards the creation of grievance redressal mechanism.
RBI Governor meets MD & CEOs of Public and Private Sector Banks, NBFCs & Mutual Funds to review theCurrent Economic condition, over Video Conference. Credit flows to different sectors of the economy, including liquidity to Non-Banking Financial Companies, Micro Finance Institutions, Housing Finance Companies, Mutual Funds, etc.;Post lockdown strategies for supply of credit, including working capital, to MSMEs, traders and bottom of pyramid customers in semi-urban, rural and urban areas; Impact of measures taken by the Reserve Bank with regard to the provision of liquidity etc.
Non-Banking Financial Companies (NBFCs) covered by Rule 4 of the Companies (Indian Accounting Standards) Rules, 2015 are required to comply with Indian Accounting Standards (Ind AS) for the preparation of their financial statements in order to promote a high quality and consistent implementation as well as facilitate comparison and better supervision,
The govt said it would allow PSBs to get partial guarantees against the purchase of BBB+ rated securities of NBFCs in addition to existing norms for AA or higher rated assets
Banks have been lending only to good quality NBFCs; they may continue to be wary of risky assets.
RBI proposes new, stringent liquidity norms for NBFC.
To improve risk-management practices, RBI tells NBFCs to post ‘chief risk officer’