**Policy Summary: Deferral of Net Stable Funding Ratio (NSFR) Implementation**
This circular, DOR.No.LRG.BC.4021/04.098/2020-21, issued by the Reserve Bank of India (RBI) on February 05, 2021, addresses the implementation of the Basel III Framework on Liquidity Standards, specifically the Net Stable Funding Ratio (NSFR). This circular is directed towards all Commercial Banks, excluding Regional Rural Banks, Local Area Banks, and Payments Banks.
The circular announces a further deferral of the NSFR guidelines implementation, initially scheduled for April 1, 2021, as per circular DOR.BP.BC.No.16/21.04.098/2020-21 dated September 29, 2020. This deferral is attributed to the ongoing stress caused by the COVID-19 pandemic.
As a result of this decision, the NSFR Guidelines will now come into effect from October 1, 2021.
For further information, contact Usha Janakiraman, Chief General Manager, Department of Regulation, Central Office, Reserve Bank of India, 12th/13th Floor, Central Office Building, Shahid Bhagat Singh Marg, Mumbai – 400001. Telephone: 22661602, 22601000. Fax: 022-2270 5670, 2260 5671, 2270 5691, 2260 5692. Website: www.rbi.org.in.
Key Entities Referenced
Reserve Bank of India: The central bank of India, responsible for monetary policy and regulation of the banking system.
Basel III Framework on Liquidity Standards: An international regulatory framework for banks, designed to improve the banking sector's ability to absorb shocks arising from financial stress.
Net Stable Funding Ratio (NSFR): A key component of the Basel III framework, it requires banks to maintain a minimum amount of stable funding relative to their illiquid assets.
Commercial Banks: Banks that are operating for profit.
Regional Rural Banks: Banks operating at a regional level in India to cater to rural areas.
Local Area Banks: A type of private sector bank in India.
Payments Banks: A type of bank in India that can accept deposits and offer payment services, but cannot lend.
Mumbai, Maharashtra: A city in India, location of Central Office of Reserve Bank of India.
भारतीय �रजवर् ब�क
___________RESERVE BANK OF INDIA___________
www.rbi.org.in
RBI/2020-21/95
DOR.No.LRG.BC.40/21.04.098/2020-21 February 05, 2021
All Commercial Banks
(excluding Regional Rural Banks,
Local Area Banks and Payments Banks)
Dear Sir/Madam,
Basel III Framework on Liquidity Standards –
Net Stable Funding Ratio (NSFR)
Please refer to our circular DBR.BP.BC.No.106/21.04.098/2017-18 dated May 17,
2018 on Basel III Framework on Liquidity Standards - Net Stable Funding Ratio
(NSFR)-Final Guidelines (‘NSFR Guidelines’) and circular
DOR.BP.BC.No.16/21.04.098/2020-21 dated September 29, 2020 deferring the
implementation of the said guidelines till April 1, 2021.
2. In view of the ongoing stress on account of COVID-19, it has been decided to defer
the implementation of NSFR guidelines by a further period of six months. Accordingly,
the NSFR Guidelines shall come into effect from October 1, 2021.
Yours faithfully
(Usha Janakiraman)
Chief General Manager
िविनयमन िवभाग, क�द्रीय काया�लय, 12वी ंऔर 13वी ंमंिज़ल, क�द्रीय काया�लय भवन, शहीद भगत िसंह माग�, मुंबई 400001
टेलीफोन /Tel No: 22661602, 22601000 फै�/Fax No: 022-2270 5670, 2260 5671, 5691 2270, 2260 5692
Department of Regulation, Central Office, 12th & 13th Floor, Central Office Building, Shahid Bhagat Singh Marg, Mumbai -
400001
Tel No: 22661602, 22601000 Fax No: 022-2270 5670, 2260 5671, 5691, 5692