RBI tightens leverage calculations, keeps bank ratios unchanged
In short
The Reserve Bank of India changed how banks must calculate leverage, starting April 1, 2027. It widened the measurement of derivatives, repo deals and off-balance-sheet exposures, but kept the minimum ratios at 4% for systemically important banks and 3.5% for others.
This matters because banks may have to show larger exposures and follow tougher disclosure rules. The reporting does not say how much balance sheets or capital needs will change.
What the reporting says
The Reserve Bank of India tightened leverage ratio calculations for banks by widening how derivatives, repo transactions and off-balance-sheet exposures are measured, effective April 1, 2027. It kept the minimum ratios unchanged at 4% for systemically important banks and 3.5% for others, while also strengthening disclosure rules and limiting the use of collateral and netting. The reporting does not quantify the resulting impact on bank balance sheets.
Why it matters
The Reserve Bank of India tightened leverage ratio rules for banks by expanding the exposures that count in the calculation, including derivatives, repo transactions and off-balance-sheet items. The minimum ratios stay at 4% for systemically important banks and 3.5% for others, with the rules effective April 1, 2027. The reporting also says disclosures will be stronger and collateral and netting will be more restricted, but it does not quantify the balance-sheet effect.