RBI Press Conference LIVE | From the perspective of regulatory norms to spur an economic revival, the measures announced aim to maintain adequate liquidity in the system, facilitate bank credit flow and ease financial stress. These are absolutely welcome, given that economic activity has come to a standstill during the lockdown. The RBI had earlier permitted extension by one year without asset classification downgrade, if DCCO was delayed for reasons beyond control of promoters. This relief is now also allowed for NBFCs; loans by NBFCs to commercial real estate will get the same relief. This move will positively impact NBFCs and real estate. The positive GDP growth forecast by IMF for India at 7.4% post Covid crisis is silver lining amidst dark terrain. Today’s overarching financial instrumental steps announced by RBI assured the constant monitoring of the daunting Human- Economic crisis. Today’s targeted liquidity transfusion measures aimed to improve the yield curve and incentivize banks to deploy more funding to the industry seems to be a kick-start step towards financial resilience: Niranjan Hiranandani, President – Assocham and NAREDCO
RBI Governor Press Conference Highlights | RBI monitoring situation, will use all instruments to address COVID-19 challenge, says Shaktikanta Das
Catch live updates of RBI Governor Shaktikanta Das' key announcements on our blog
Reserve Bank of India (RBI) Governor Shaktikanta Das addressed the media for a second time since the COVID-19 outbreak. Here's a round-up of the key announcements.The announcements covered four key points:
- Maintaining liquidity in the system
- Facilitating and incentivising bank credit flows
- Easing financial stress
- Enabling formal working of markets
- NPA classification will now not include the 90- day moratorium on loans.
- Another liquidity boost through TLTRO 2.0 worth Rs 50,000 crore to begin with for NBFCs, HFCs and MFIs
- Special refinance facilities of Rs 50,000 cr to NHB, SIDBI and NABARD
- LCR requirement for SCB to be brought down from 100 percent to 80 percent with immediate effect
- Fixed reverse repo rate under LAF cut by 25 bps to 3.75 percent from 4 percent with immediate effect
- For all accounts where moratorium or deferment has been applied, there would be an asset classification standstill
- DCCO delayed for reasons beyond the control of promoters, can now be extended by one year without asset classification downgrade. This relief is now also allowed for NBFCs.
- For large accounts under default, additional provisioning of 20 percent is required for not implementing resolution in 180 days. This has now been relaxed.- Banks shall not declare dividends until further notice