What changed
RBI issued a clarification in response to queries about its earlier circular on non-SLR investments. It explicitly stated that there is no relaxation in the overall limit of 10% of total deposits or the sub-ceiling of 5%.
What it means for you
Co-operative banks must continue to adhere strictly to the existing non-SLR investment caps. Any expectation of increased flexibility is unfounded, and banks must ensure compliance to avoid regulatory action.
What you must do
- Review your bank's non-SLR investment portfolio to ensure it does not exceed 10% of total deposits as of March 31 of the previous year.
- Verify that the sub-ceiling of 5% for any specific category is not breached.
- Place this circular before the board for formal acknowledgment and compliance.
- Acknowledge receipt of this circular to your respective RBI Regional Office.
Who it affects
State Co-operative Banks (SCBs), District Central Co-operative Banks (DCCBs)
What is the non-SLR investment limit for co-operative banks?
The overall limit is 10% of total deposits as on March 31 of the previous year, with a sub-ceiling of 5% as per the earlier circular.
Has RBI relaxed the non-SLR investment limit?
No, RBI has clarified that there is no relaxation in the limit. The existing caps remain unchanged.