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Informist, Wednesday, Aug. 20, 2025

--RBI releases draft circular for revised counterparty credit risk norms 

--RBI invites comments on draft for counterparty credit risk norms by Sept 10

MUMBAI – The Reserve Bank of India Wednesday invited public comments on the draft circular on counterparty credit risk, a press release published on the central bank's website said. The central bank would accept comments from banks, market participants, and other interest parties till Sept. 10 and the feedback can be submitted through the RBI's website or by email, the press release said.

The existing norms were last revised in August 2008 and the Basel Commitee on Banking Supervision reviewed these norms to reflect the development and depth of the respective market segments, the release said. The existing norms on capital adequecy prescribe the current exposure method for computation of counterparty credit risk and the RBI reviewed these to align the add-on factors for calculation of potential future exposure in the current method, the press release said.

The release also said that the central bank has reviewed these norms to clarify that banks acting as clearing members of stock exchanges recognised by the Securities and Exchange Board of India are required to maintain capital charge for the counterparty credit risk in the equity and commodity derivatives segments and are required to maintain capital charge for the counterparty credit risk.  End

Reported by Gowri Lakshmi

Edited by Akul Nishant Akhoury

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