Banks can take higher slice of SLR portfolio: RBI

The total carve-out from SLR available to banks would be 10% of their NDTL

Reserve Bank of India (RBI) on Thursday said that banks will be permitted to reckon government securities held by them up to another 3 per cent of their Net Demand and Time Liability (NDTL) under Facility to Avail Liquidity for Liquidity Coverage Ratio (FALLCR) within the mandatory statutory liquidity ratio (SLR) requirement for the purpose of computing their liquidity coverage ratio (LCR).

Hence, the total carve-out from SLR available to banks would be 10 per cent of their NDTL. For this purpose, it said that banks should continue to value such reckoned government securities within the mandatory SLR requirement at an amount no greater than their current market value.

State Bank of India, Chairman, Arundhati Bhattacharya said: "Instead of 5 per cent, we have asked for 15 per cent of SLR portfolio to be used for LCR."

Presently, the assets allowed as the Level 1 High Quality Liquid Assets (HQLAs) for the purpose of computing the LCR of banks include Government securities in excess of the minimum SLR requirement, and within the mandatory SLR requirement, government securities to the extent allowed by RBI, under Marginal Standing Facility (MSF) which is presently 2 per cent of the bank's NDTL and under FALLCR (presently 5 per cent of the bank's NDTL).