COVID19 Regulatory Package: RBI extends Resolution Timelines on stressed assets under the Prudential Framework

In terms of the existing Prudential Framework, lenders are required to implement a resolution plan in respect of entities in default within 180 days from the end of Review Period of 30 days. As announced in the RBI Governor’s statement on Friday (17.04.2020), on a review aimed at alleviating the lingering impact of Covid19 on…

Lending to NBFCs for on-lending to be classified as Priority sector up to a cap

Today (Monday, March 23, 2020), RBI advised commercial banks that their loans to registered NBFCs (other than MFIs) for on-lending to be eligible for classification as priority sector is extended for FY 2020-21. The circular further said that existing loans disbursed under the on-lending model will continue to be classified under the Priority Sector till…

Single borrower/ group exposure limit and priority sector lending target for UCBs revised

The Reserve Bank of India (RBI) on Friday (March 13, 2020) lowered the single borrower and group exposure limit for urban cooperative banks (UCBs) to 15% and 25% of tier I capital, respectively, to reduce concentration risks arising out of such large loans.  As per RBI Cir.No.44/13.05.00/2004-05 dated April 15, 2005,  Primary (Urban) Co-operative Banks…

Hereafter short term crop loans extended only through KCC is eligible for interest subvention scheme

Reserve bank of India advised all the scheduled commercial banks that with effect from April 1, 2020, Short Term Crop Loans should be extended only through KCC to be eligible for Interest Subvention Scheme (ISS) and Prompt Repayment Incentive (PRI). According to the notification, the Ministry of Agriculture & Farmers Welfare vide their Office Memorandum,…