India Strengthens Banking Regulation - Several Measures taken by RBI

RBI asks UCBs to report large accounts data almost with immediate effect

 

In its drive to strengthen supervision of Urban Co-operative Banks (UCBs) post the PMC, UCBs told to report exposures above Rs 5 crore to CRILC, almost with immediate effect. It has issued detailed guidelines for reporting, making rules closer to that for commercial banks.

The detailed guideline stipulates that the reporting frequency of the CRILC (Central Repository on Information on large Credits)– UCBs return is quarterly to start with. The banks need to submit the data on large exposures within 30 days from the end of the quarter through XBRL reporting platform of RBI. Banks may put in place appropriate systems to be in readiness to submit the return on a more frequent periodicity.

The CRILC – UCBs return need to be under three broad heads including, exposure to large borrowers, reporting of Technically/ Prudentially Written-off Accounts and reporting of Balance in Current accounts. The regulator has also warned that UCBs need to take utmost care about data accuracy and integrity while submitting the data on large credits to the RBI, failing which they could face penal action. Even large commercial banks like State Bank of India have been fined for not fully complying with the CRILIC requirement.

Earlier on December 27, in a notification issued to Primary (Urban) Co-operative Banks (UCBs) on Tuesday, the Reserve Bank of India mandated that all UCBS having total assets of Rs 500 crore and above shall report credit information, including classification of an account as Special Mention Account (SMA), on all borrowers having aggregate exposures of Rs 5 crore and above with them to CRILC. The central bank also clarified that aggregate exposure shall include all fund-based and non-fund based exposure, including investment exposure on the borrower. UCBs need to submit the data in CRILC-UCBs return from the quarter ended December 31, 2019, RBI clarified.

The guidelines follows the regulatory announcements that the governor during RBI’s December 2019, bi monthly policy statement in which it said that with a view to building a database of large credits of UCBs, it has been decided to bring UCBs with assets of Rs 500 crores and above under the CRILC reporting framework

The reporting frequency of the CRILC– UCBs return is quarterly to start with and banks need to submit the data on large exposures within 30 days from the end of the quarter through RBI’s XBRL reporting platform. XBRL is a reporting platform set up by the banking regulator which facilitates real time reporting of data on a bank’s operations of RBI. Banks may put in place appropriate systems to be in readiness to submit the return on a more frequent periodicity. These guidelines are applicable to all commercial banks for more than five years now.

Source: Economic Times

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