The Reserve Bank of India has issued the Reserve Bank of India (Commercial Banks – Prudential Norms on Capital Adequacy) Third Amendment Directions, 2026, with immediate effect, amending the Reserve Bank of India (Commercial Banks – Prudential Norms on Capital Adequacy) Directions, 2025 to provide greater clarity on the treatment of Counterparty Credit Risk (CCR) exposures and align the framework with international standards. The amendment introduces a clarification that CCR exposures of all entities required to be consolidated must be included while computing capital requirements on a consolidated basis. It also revises the add-on factors for market-related off-balance sheet exposures (such as interest rate, exchange rate, equity, precious metal, and commodity contracts) under Table 16. Additional provisions clarify the treatment of contracts with periodic reset features, applicability of add-on factors to all outstanding CCR exposures, and CCR capital charge requirements for banks acting as clearing members of SEBI-recognised stock exchanges in derivatives segments. Further, the amendment modifies the risk-weight treatment for clearing member exposures to Qualified Central Counterparties (QCCPs), generally prescribing a 2% risk weight, with exemption from capital maintenance where the bank has a valid legal opinion confirming absence of reimbursement liability to clients in case of QCCP default.
Link – https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=13326&Mode=0
