The RBI has extended the deadline for the last tranche of CCB or capital conservative buffer by more six months.
Now the last tranche of CCB can be submitted by October 2021. The limit has been increased due to the resuming stress occurred by global pandemic Covid-19.
This implementation of the last tranche of CCB was scheduled to take place by April 1, 2020. It was postponed to April 1, 2021 further due to the pandemic.
The CCB was scheduled to be implemented in tranches of 0.625 percent as per the Basel standards. Also, there was a transition of full CCB around 2.5 percent which was scheduled to take place by March 31, 2019.
Apart from this the Central Bank RBI also decided to postpone the execution of NSFR or Net Stable Funding Ratio.
The NSFR reduces the risk of funding by making the banks to fund their activities along with satisfactory stable sources of funding.
Usually, the time period is of one year and it helps in risk mitigation of future funding stress. The NSFR was needed to be introduced from April 1, 2021 by all banks.
Also, the Reserve Bank of India increased the limits to 22 percent under Held to Maturity category. Earlier the limit was set at 19.2 percent.
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