Back to Career News

RBI harmonises provisioning norms for urban cooperative banks

April 25, 2023

RBI harmonises provisioning norms for urban cooperative banks
The Reserve Bank on Monday harmonised the provisioning norms for standard assets applicable to all categories of urban cooperative banks (UCBs). In December last year, the RBI had categorised UCBs into four tier 1, 2, 3 and 4 for regulatory purposes. Prior to that, such banks fell only in tier 1 and tier 2 categories.

“On a review, it has been decided to harmonise the provisioning norms for standard assets applicable to all categories of UCBs, irrespective of their tier in the revised framework,” the central bank said in a circular.

Direct advances to agriculture and SME sectors which are standard, would attract a uniform provisioning requirement of 0.25 per cent of the funded outstanding on a portfolio basis to all categories of UCBs under the revised framework.

Advances to commercial real estate (CRE) sector which are standard shall attract a uniform provisioning requirement of 1 per cent of the funded outstanding on a portfolio basis.

In case of Commercial Real Estate-Residential Housing Sector (CRE-RH) and all other loans and advances, the provisioning requirements would be 0.75 per cent and 0.4 per cent, respectively.

RBI has categorised all unit UCBs and salary earners’ UCBs (irrespective of deposit size), and all other UCBs having deposits up to ₹100 crore in tier 1.

Important Links:

Recommended for you ...

Axis Bank and Mastercard Launch Premium Credit Card for Small Business Owners
Axis Bank and Mastercard Launch Premium Credit Card for Small Business Owners

September 26, 2024

Banks Report Over 15% Growth in New Credit Card Additions: RBI Data
Banks Report Over 15% Growth in New Credit Card Additions: RBI Data

September 26, 2024

National Company Law Tribunal (NCLT) Approves Merger of IDFC and IDFC First Bank
National Company Law Tribunal (NCLT) Approves Merger of IDFC and IDFC First Bank

September 25, 2024

Chat on WhatsApp