The Hindu Business Line : Capital market exposure norms: Deadline extended

Mumbai, Jun 25 The Reserve Bank of India on Thursday further extended by six months the transition period for banks to comply with the capital market exposure norms with respect to loans extended to mutual funds and issue of irrevocable payment commitments (IPCs).

The new deadline for meeting the capital market exposure norms for banks is December 31.

The Annual Financial Inspection reports of certain banks and an analysis of the Consolidated Prudential Return (CPR) of some banks in 2007 had revealed that the banks had extended large loans to various mutual funds and had also issued Irrevocable Payment Commitments (IPCs) to stock exchanges (BSE & NSE) on behalf of mutual funds/FIIs.

These exposures had, however, not been included by the banks for computation of their capital market exposure.

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