The much-touted Board meeting of the Reserve Bank of India’s (RBI) Central Board took place in Mumbai on Monday. The meeting discussed the Basel regulatory capital framework, a restructuring scheme for stressed MSMEs, bank health under Prompt Corrective Action (PCA) framework and the Economic Capital Framework (ECF) of RBI.
Govt expected its nominees to strongly argue case of loosening credit flow in the economy. Sahakar Bharati Patron and a well-known cooperator Satish Marathe is one of the two government nominees on the Central Board.
The Board decided to constitute an expert committee to examine the ECF, the membership and terms of reference of which will be jointly determined by the Government of India and the RBI.
The Board also advised that the RBI should consider a scheme for restructuring of stressed standard assets of MSME borrowers with aggregate credit facilities of up to ? 250 million, subject to such conditions as are necessary for ensuring financial stability.
The Board, while deciding to retain the CRAR at 9%, agreed to extend the transition period for implementing the last tranche of 0.625% under the Capital Conservation Buffer (CCB), by one year, i.e., up to March 31, 2020. With regard to banks under PCA, it was decided that the matter will be examined by the Board for Financial Supervision (BFS) of RBI.