The Reserve Bank on Thursday issued clarification regarding prudential treatment of exposures of foreign bank branches operating in India to their group entities, along with host of amendments to various other regulations. The amendments to Large Exposures Framework (LEF) and Intragroup Transactions and Exposures also suggests for certain methodological aspects relating to calculation of LEF and intragroup transactions and exposures (ITE). It further said banks shall have policies on concentration risk management of their exposures towards a single counterparty, groups of interconnected counterparties, specific sectors of the economy as also systems to monitor and address the risks emanating to them from their exposures to ultra-large borrowers.
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