Fixed Reverse Repo rate reduced by 25 basis points from 4 % to 3.75%.
WMA Limit- To increase WMA limits by 60% to all the state governments amid Covid-19. Ways and means advances is a mechanism used by Reserve Bank of India under its credit policy to provide to States, banking with it, to help them tide over temporary mismatches in the cash flow of their receipts and payments.
Asset classification – The payment moratorium period to be excluded by banks and other financial institutions from 1st March 2020 til 31th May 2020 from 90 days classification of NPA norms.
Provisions - Banks will have to maintain a provision of all such accounts to who moratorium has been provided @10 % for the quarter ending March 2020 and June 2020.
Schedule commercial banks, all India financial institutions and NBFC are required to make provision @ 20% if the defaulted amount cannot be recovered within 210 days of default. Such a period of 210 days has been extended for a further period of 90 days.
No Dividends - Scheduled commercial banks and other commercial banks shall not pay any dividends till further orders of RBI, however, RBI shall further look into this matter on 30th Sep 2020.
LCR- The liquidity coverage ratio (LCR) refers to the proportion of highly liquid assets held by financial institutions, to ensure their ongoing ability to meet short-term obligations. LCR requirement for scheduled commercial banks will be brought down from 100%-80% with immediate effect. It will be restored back in 2 Phases: As on 1st OCT 2020 it will be restored to 90%, As on 1April 2021 it will be again restored to 100 %.
Loans given by NBFC’s for commercial Real Estate projects – Period of Repayment shall be extended for 1 year without Restructuring of Assets. For Original Press Release click on the link below:
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