RBI Revises Capital Adequacy Norms for Banks

On 8th May 2026, the Reserve Bank of India revised guidelines related to the inclusion of quarterly profits in banks’ core capital calculations, removing an earlier condition linked to provisioning for non-performing assets (NPAs).

  • Aim: Simplifying the framework used to assess banks’ financial strength and capital adequacy.

Key Revisions Made

  • Removal of NPA Provisioning Condition: The revised framework eliminates the earlier requirement related to incremental provisioning for non-performing assets (NPAs).
  • üEarlier, banks could include quarterly profits in CRAR calculations only if NPA provisions during any quarter did not deviate by more than 25% from the annual average provisioning level.
  • Simplified Capital Calculation: ....
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