RBI updates rules to lower banks' exposure to capital markets risk, introducing a clause for custodian banks issuing IPCs and capping intraday risk at 30%.
RBI updates rules to lower banks' exposure to capital markets risk by requiring custodian banks issuing Irrevocable Payment Commitments (IPCs) to have a clause granting them an inalienable right over securities to be received in any settlement. This rule is not enforced if transactions are pre-funded. The new rules cap the maximum intraday risk at 30% of the settlement amount.
May 03, 2024
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