We at Finakon track the regulatory changes. We also use AI to create a summary. We are providing a quick overview of the RBI circulars on a weekly basis on our website. The summary is neither exhaustive nor comprehensive. For accurate information, users shall refer to the original circular of the regulator. Finakon shall not be responsible for inferences drawn based on the summary provided.
RBI Deletes Provision on Limits for Non-Option Derivative Contracts
The Reserve Bank of India (RBI) has amended the Commercial Banks – Miscellaneous Directions, 2025, by deleting Section C of Chapter IV (Paragraph 37), which deals with limits for non-option derivative contracts.
The amendment is effective immediately upon issuance.
https://rbi.org.in/Scripts/BS_CircularIndexDisplay.aspx?Id=13740
RBI Deletes Limits Provision for Non-Option Derivative Contracts for Small Finance Banks
The Reserve Bank of India (RBI) has amended the Small Finance Banks – Miscellaneous Directions, 2025, by deleting Paragraph 37 of Chapter IV, Section C, which deals with limits for non-option derivative contracts. The amendment is effective immediately upon issuance.
https://rbi.org.in/Scripts/BS_CircularIndexDisplay.aspx?Id=13741
RBI Directs Regulated Entities to Act on Updates to UNSC Sanctions List
The Reserve Bank of India (RBI) has notified regulated entities of amendments to three entries—two individuals and one entity—in the United Nations Security Council’s (UNSC) ISIL (Da’esh) and Al-Qaida Sanctions List, pursuant to the Unlawful Activities (Prevention) Act, 1967 (UAPA).
Regulated entities must take appropriate action in accordance with the RBI’s Know Your Customer (KYC) Directions and the prescribed UAPA procedure. They are also required to refer to the updated sanctions lists and ensure compliance with the applicable requirements.
https://rbi.org.in/Scripts/BS_CircularIndexDisplay.aspx?Id=13742
RBI Revises Leverage Ratio Framework for Commercial Banks
The Reserve Bank of India (RBI) has amended the Prudential Norms on Capital Adequacy Directions, 2025, to align the leverage ratio framework with the Basel Committee on Banking Supervision’s 2017 standard.
The revised directions specify minimum leverage ratios of 4% for Domestic Systemically Important Banks (D-SIBs) and 3.5% for other banks, with additional requirements for Indian branches of Global Systemically Important Banks (G-SIBs). They also update the methodology for measuring exposures, including derivatives, securities financing transactions and off-balance-sheet items, along with disclosure and reporting requirements.
The amendments will come into effect from April 1, 2027.
https://rbi.org.in/Scripts/BS_CircularIndexDisplay.aspx?Id=13743
RBI Delegates FEMA Compounding Powers to Regional Offices
The Reserve Bank of India (RBI) has delegated the authority to compound certain contraventions under the Foreign Exchange Management Act (FEMA), 1999, relating to Overseas Investments, Borrowing and Lending, and Guarantees to select Regional Offices.
Applications must be submitted to the designated Regional Office based on the applicable UIN or the Indian entity’s registered office or applicant’s domicile, as specified in the circular. Certain applications, including those involving multiple categories of contraventions, must be submitted to RBI’s Central Office.
https://rbi.org.in/Scripts/BS_CircularIndexDisplay.aspx?Id=13745
RBI Revises Operational Risk Capital Requirements for Commercial Banks
The Reserve Bank of India (RBI) has amended the Commercial Banks – Forthcoming Instructions Directions, 2025, relating to minimum capital requirements for operational risk, effective April 1, 2027.
The amendments revise the calculation of the Business Indicator (BI), including the classification of income, expenses and relevant balance-sheet items. They also specify the use of up to 10 years of operational risk loss data for calculating the Loss Component, with at least five years permitted where 10 years of high-quality data is unavailable when a bank first becomes subject to the Internal Loss Multiplier (ILM) calculation. Further, the directions clarify how losses arising from damaged or destroyed assets should be calculated.
https://rbi.org.in/Scripts/BS_CircularIndexDisplay.aspx?Id=13744
RBI Revises Lead Bank Responsibilities Following Delhi District Reorganisation
The Reserve Bank of India (RBI) has revised Lead Bank responsibilities in the National Capital Territory (NCT) of Delhi following the reorganisation of districts and the creation of three new districts: Old Delhi, Central North and Outer North. Shahdara district has ceased to exist.
The Lead Bank responsibilities for the newly created districts have been assigned to Canara Bank for Old Delhi, State Bank of India for Central North, and Punjab National Bank for Outer North. The Lead Bank assignments for the existing Central and Northwest districts have also been revised, with State Bank of India assigned to Central and Union Bank of India to Northwest.
The earlier Lead Bank assignment for Shahdara district to Bank of Baroda has been revoked. Lead Bank assignments for all other districts remain unchanged until further communication from the RBI.
https://rbi.org.in/Scripts/BS_CircularIndexDisplay.aspx?Id=13746
