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Corporate Laws Central Ministry of Finance Reserve Bank of India Act, 1934

Non-achievement of PSL targets- Prudential treatment of contribution towards eligible funds with NABARD, NHB, SIDBI and MUDRA Ltd

09-Jun-2025 | RBI/2025-26/49 DoR.CRE.REC.28/07.10.002/2025-26

RBI has issued the notification relating to the Non-achievement of PSL targets - Prudential treatment of contribution towards eligible funds with NABARD, NHB, SIDBI and MUDRA Ltd. By virtue of the notification, the following has been stated: 1. Exemption from exposure norms- It has been decided that the contribution by UCBs towards eligible funds with NABARD, NHB, SIDBI, MUDRA Ltd., or any other entity specified by the RBI, on account of a shortfall in PSL targets, shall not be included while computing the aggregate exposure of a UCB to such counterparties to decide the above prudential exposure limits. 2. Risk weight- It is further clarified that contribution by UCBs towards above eligible funds on account of shortfall in PSL targets, shall fall under the category of ‘all other assets’, attracting a risk weight of 100 per cent for capital adequacy purposes, in terms of Annexure 1 of the RBI circular dated April 25, 2001, on Application of Capital Adequacy Norms to Urban (Primary) Co-operative Banks.

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