Master Circular- Prudential Norms for Classification, Valuation and Operation of Investment Portfolio by FIs- Amendment
Please refer to Paragraph No.2.5.3.4 (iii) of Master Circular DBR.No.FID.FIC.3/01.02.00/2015-16 dated July 01, 2015 on Prudential Norms for Classification, Valuation and Operation of Investment Portfolio by FIs.
2. The position has been reviewed with a view to aligning the asset classification norms applicable to All India Financial Institutions with those for banks. Accordingly, the Paragraph No.2.5.3.4 (iii) of the above Master Circular is amended as follows:-
| Existing Paragraph 2.5.3.4(iii) | Revised Paragraph 2.5.3.4(iii) |
| If any credit facility availed by the issuer of the security is classified as NPA in the books of the FI, investment in any of the securities issued by the same issuer would also be treated as NPI. | If any credit facility availed of by the issuer is classified as NPA in the books of the FI, investment in any of the securities, including preference shares issued by the same issuer would also be treated as NPI and vice versa. However, if only the preference shares are classified as NPI, the investment in any of the other performing securities issued by the same issuer may not be classified as NPI and any performing credit facilities granted to that borrower need not be treated as NPA.1 |
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