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RBI tweaks norms for setting up of IFSC Banking Units

Press Trust of India  |  Mumbai 

Modifying the norms for setting up IFSC Units, RBI said today that the parent will be required to provide and maintain at all times a minimum capital of USD 20 million to its IBU.

In April 2015, the Reserve had formulated a scheme for setting up of International Centres (IFSC) Units (IBUs) by banks in

RBI said modification has been made based on suggestions from stakeholders to consider minimum prescribed regulatory capital at the parent level rather than at the IBU level.

"With a view to enabling IBUs to start their operations, the parent will be required to provide a minimum capital of USD 20 million or equivalent in any foreign currency to its IBU which should be maintained at all times," it said in a notification.

However, it added the minimum prescribed regulatory capital, including for the exposures of the IBU, should be maintained on an on-going basis at the parent level.

Also, the will be required to provide a Letter of Comfort for extending financial assistance, as and when required, in the form of capital/liquidity support to IBU.

The government has set up an IFSC in namely International Tec-City (GIFT) in Gandhinagar,

The guidelines are applicable to IBUs set up in GIFT as well as in other which may be set up in

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, May 17 2018. 19:20 IST