The RBI today issued detailed NSFR guidelines to ensure that banks maintain a stable funding profile in relation to the composition of their assets and off-balance sheet activities.
In the backdrop of the global financial crisis that started in 2007, the Basel Committee on Banking Supervision (BCBS) proposed certain reforms to strengthen global capital and liquidity regulations with the objective of promoting a more resilient banking sector.
"The NSFR would be applicable for Indian banks at the solo as well as consolidated level.
"For foreign banks operating as branches in India, the framework would be applicable on stand-alone basis (for Indian operations only)," the guidelines said.
The NSFR is defined as the amount of available stable funding relative to the amount of required stable funding.
The NSFR would be binding on banks with effect from a date which will be communicated in due course, the RBI added.
The RBI had issued draft guidelines on the NSFR for banks in India on May 28, 2015.
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