Follow the 14 units to connect capital adequacy with lending, asset quality, liquidity, investments, loan transfers and regulatory reporting. Current rules and changes beginning 1 April 2027 are clearly separated.
Finin2min · Updated 25 October 2026
These guides principally explain the defined commercial-bank Directions; their usual definition excludes Small Finance Banks, Payments Banks and Local Area Banks. The NBFC scale-based module provides the separate NBFC route. Current capital, IRAC and credit requirements continue under their applicable 2025 Directions and amendments. The new credit-risk standardised and asset-classification/provisioning frameworks begin on 1 April 2027; publication in 2026 did not replace the current calculation rules early.
Sources: RBI Commercial Banks Prudential Norms on Capital Adequacy Directions, 2025 — updated 7 October 2026 — PDF pages 4–15; RBI Commercial Banks Credit Risk — Standardised Approach Directions, 2026 — effective 1 April 2027 — paragraphs 1–5; RBI Commercial Banks Asset Classification, Provisioning and Income Recognition Directions, 2026 — effective 1 April 2027 — paragraphs 1–5
Units 1–2 distinguish eligible CET1/AT1/Tier 2, the CRAR denominator, buffers and the separate leverage backstop. Base minima of 5.5% CET1, 7% Tier 1 and 9% total are supplemented by the 2.5% CET1 conservation buffer and applicable bank-specific requirements. Risk weights depend on the actual category and current rules; lending to a Government-linked entity or holding collateral does not automatically give zero weight. Unit 2 explains the coming 2027 standardised approach without presenting future thresholds as today’s obligations.
Sources: RBI Commercial Banks Prudential Norms on Capital Adequacy Directions, 2025 — updated 7 October 2026 — PDF pages 13–15, 94–245, 317–346; RBI Commercial Banks Credit Risk — Standardised Approach Directions, 2026 — effective 1 April 2027 — paragraphs 1–40
Units 3–4 explain concentration, connected counterparties, credit assessment and approvals. A permitted exposure still needs sound underwriting; a strong internal rating does not waive a legal prohibition. Unit 12 addresses related and connected lending, including conflicts and substantial-interest tests. Use the current Tier 1 exposure bases and the actual category exemptions, rather than an old undifferentiated capital-funds percentage. Credit-information duties in unit 13 continue separately from sanction and exposure limits.
Sources: RBI Commercial Banks Concentration Risk Management Directions, 2025 — official PDF — PDF pages 1–56; RBI Commercial Banks Credit Risk Management Directions, 2025 — official PDF — PDF pages 1–53; RBI Commercial Banks Credit Information Reporting Directions, 2025 — updated 1 July 2026 — paragraphs 1–42
Units 5–6 explain NPA triggers, day-end treatment, income recognition, provision rates and upgrades. Unit 11 follows stressed assets through review, resolution, restructuring, settlement and the specific project/calamity rules. The review and implementation periods do not suspend ordinary classification. A technical write-off preserves recovery rights, and a Government relief announcement alone does not extinguish the debt. Test the actual route and its conditions rather than assuming every modification produces the same result.
Sources: RBI Commercial Banks Income Recognition, Asset Classification and Provisioning Directions, 2025 — updated 1 October 2026 — paragraphs 1–147; RBI Commercial Banks Resolution of Stressed Assets Directions, 2025 — updated 1 October 2026 — PDF pages 1–62
Unit 7 separates maturity-gap controls, the LCR and NSFR, each with its own horizon, weights and reporting requirements. Unit 8 explains HTM, AFS and FVTPL, with HFT as a FVTPL sub-category, fair valuation, impairments and investment income. A security’s accounting category, its HQLA eligibility and its capital treatment are different questions. Reclassifying it does not create cash or remove an underlying NPA. Current valuation and 2026 liquidity amendments are incorporated in their respective guides.
Sources: RBI Commercial Banks Asset Liability Management Directions, 2025 — paragraphs 1–284; RBI Commercial Banks Classification, Valuation and Operation of Investment Portfolio Directions, 2025 — updated 1 October 2026 — paragraphs 1–115
Units 9–10 explain two transaction frameworks. Securitisation requires the actual eligible pool, holding/retention, due-diligence, structural and disclosure tests; ordinary assignment, novation or participation has different rules. Stressed-loan transfers cannot simply use performing-loan participation. MHP timing, valuation, seller retention and credit enhancement must be tested under the applicable route. Retain the loan records, borrower/security consents and transaction disclosures required for the relevant route.
Sources: RBI Commercial Banks Securitisation Transactions Directions, 2025 — paragraphs 1–116; RBI Commercial Banks Transfer and Distribution of Credit Risk Directions, 2025 — updated 1 October 2026 — paragraphs 1–146
Units 13–14 distinguish bureau reporting, correction/compensation and prudential returns. Credit information has the current reference dates and incremental/full-file deadlines; an ordinary supervisory return has a different frequency and due-date rule. Public capital and leverage disclosures are additional obligations with their own quarterly/half-yearly scope. Reconcile the relevant population, balances, classification and rejected records; one submitted file does not establish compliance with all these requirements.
Sources: RBI Commercial Banks Credit Information Reporting Directions, 2025 — updated 1 July 2026 — paragraphs 1–42; RBI Commercial Banks Supervisory Returns Directions, 2026 — 31 July 2026; RBI Commercial Banks Prudential Norms on Capital Adequacy Directions, 2025 — updated 7 October 2026 — PDF pages 307–316, 344–346
A sound capital assessment checks eligible capital, its quality, risk-weighted assets, buffers and the separate leverage ratio. Use the current bank rules alongside their stated exceptions and future commencement dates.
The April 2026 Direction is a forthcoming banking-book framework. Its exposure classes, rating adjustments, retail tests and off-balance-sheet phase-in must not be applied as if they already governed October 2026.
The October 2026 consolidated bank Direction separates large exposures, capital-market exposure, intra-group limits and country risk. The percentage and its capital base must be tested together.
The current bank framework combines independent credit appraisal with defined data, collateral, foreign-currency and transaction-account controls. A policy document alone does not demonstrate compliance.
Use the current 2025 IRAC Direction, updated on 1 October 2026. The separate 2026 ECL Direction starts on 1 April 2027; its publication did not replace the current rules early.
Current bank provisions depend on asset class, security and ageing. Keep the NPA provision, income reversal, gross/net NPA ratio and the forthcoming ECL framework separate.
Banks need cash-flow, stock, intraday, 30-day stress and stable-funding measures together. Meeting one ratio does not establish that a bank can meet every payment, transfer liquidity across entities or absorb interest-rate risk.
The current framework uses HTM, AFS and FVTPL, with HFT inside FVTPL. Classification depends on the acquisition objective and contractual cash flows; valuation, income, impairment and sale accounting then follow separate rules.
Securitisation repackages the cash flows and credit risk of eligible underlying assets into at least two tranches. It does not eliminate borrower risk, remove investor due diligence or make the notes insured deposits.
A non-defaulted loan transfer, a stressed-loan sale, a co-lending arrangement and an inter-bank participation are different transactions. Each has its own eligibility, due-diligence, holding-period, pricing and accounting conditions.
Stress must be recognised and resolved through the applicable documented process. A proposal under discussion, a technical write-off or a Government announcement does not by itself cure a default or waive the borrower’s debt.
The framework effective from 1 April 2026 defines related persons and reciprocal relationships, sets specific prohibitions, and requires stronger approval and monitoring for otherwise permitted loans.
From 1 July 2026, the main bank credit-information file uses four monthly reference dates. Reporting quality, customer corrections and compensation follow separate requirements.
The 31 July 2026 Supervisory Returns Direction provides the current bank return inventory and general calendar. Return-specific exceptions, reference dates and data reconciliation determine the actual filing requirement.
A borrower modification can affect several units: first identify default and asset status, then test resolution or transfer eligibility, calculate the applicable provision and capital exposure, assess liquidity effects and update the correct reporting files. The transaction does not become compliant solely because one return has been submitted or one approval recorded.
Their specified 1 April 2027 commencement must be respected. Use current rules until then and prepare the migration separately.
No. They address different risks, use different denominators and have separate scope and conditions.
Illustrations are hypothetical and depend on the stated assumptions. Official blank formats and guidance are identified separately from completed reports.