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Master Circular on Risk Management and Inter-Bank Dealings (2009)

No longer current — replaced by Master Circular on Risk Management and Inter-Bank Dealings

Source: Reserve Bank of India · RBI/2009-10/26 · issued 01 Jul 2009 · ~2 min read

Quick answerRBI consolidated all instructions on risk management and inter-bank dealings into one Master Circular, covering forward contracts, currency futures, commodity hedging, and non-resident bank accounts. This circular had a one-year sunset clause, expiring July 1, 2010.

What changed

RBI issued Master Circular No. 06/2009-10 on July 1, 2009, consolidating existing instructions on risk management and inter-bank dealings into a single document. The circular included a sunset clause, meaning it would stand withdrawn on July 1, 2010 and be replaced by an updated version.

What it means for you

Banks and authorised dealers now have a single reference for all rules on forward contracts, currency futures, commodity hedging, and non-resident bank accounts. The sunset clause signals that RBI expects regular updates, so banks must stay alert for the next circular. This consolidation simplifies compliance but requires banks to track the expiry date.

Historical instruction — do not use for current compliance. This is what was required at the time; it no longer reflects current RBI requirements. If no replacement rule is linked above, that only means none is recorded on our register yet — it does not prove no later applicable rule exists. Confirm on the official RBI source below.

What banks were required to do at the time

Review the consolidated instructions in this Master Circular for all risk management and inter-bank dealings.
Ensure your bank's internal policies align with the provisions on forward contracts, currency futures, and commodity hedging.
Prepare for the circular's expiry on July 1, 2010 and monitor for the updated version.
Verify that all underlying exposures for forward contracts are properly documented as per the circular.

Who it affects

All Authorised Dealers - Category I banks, Persons resident in India (importers, exporters, entities hedging commodity price risk), Non-resident banks and exchange houses, Foreign Institutional Investors (FIIs) and Non-resident Indians (NRIs)

❓ Common questions

Regulatory timeline

Decoded by BankPulse 2026-06-19 09:35 IST
Superseded by — Master Circular on Risk Management and Inter-Bank Dealings
Status change: superseded 03 Aug 2026, 04:00 IST

Built from our lineage records — each fact carries its provenance; missing history simply is not shown (never guessed).

What is the sunset clause in this Master Circular?

The circular includes a sunset clause stating it will stand withdrawn on July 1, 2010 and be replaced by an updated Master Circular on the same subject.

Can forward contracts be booked without exact exposure amount?

Yes, if the exact amount of the underlying transaction is not ascertainable, the contract can be booked on the basis of a reasonable estimate, subject to AD Category I bank verification.

Does this circular cover hedging for foreign currency loans?

Yes, foreign currency loans/bonds are eligible for hedge only after final approval is accorded by the Reserve Bank, where such approval is necessary, or Loan Registration Number (LRN) is given by the Reserve Bank.

📜 This document’s life story (1 recorded event, each backed by RBI’s own words)

Superseded by Master Circular on Risk Management and Inter-Bank Dealings

📜 Read the original circular — full text as issued by RBI

RBI/2009-10/26 

 Master Circular No. 06 /2009-10 

 July 1,  2009 

 To,

        All Authorised Dealers - Category I Banks

Madam / Sir,

Master Circular on Risk Management and Inter-Bank Dealings 

Rupee Accounts of Non-Resident Banks, Inter-Bank Dealings, Foreign Exchange Derivative Contracts, etc. are governed by the provisions in Notification No. FEMA1/2000-RB , Regulation 4(2) of Notification No. FEMA3/RB-2000 and Notification No.FEMA25/ RB -2000 dated May 3, 2000 and subsequent amendments thereto.

2. This Master Circular consolidates the existing instructions on the subject of "Risk Management and Inter-Bank Dealings" at one place. The list of underlying circulars/notifications is set out in Appendix. 

3. This Master Circular is issued with a sunset clause of one year. This circular will stand withdrawn on July 1, 2010 and would be replaced by an updated Master Circular on the subject.

 Yours faithfully,

 Salim Gangadharan 

 Chief General Manager- in- Charge 

 INDEX 

 PART A-

Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2009-10/26 · issued 01 Jul 2009. The plain-English explanation above is BankPulse’s own independent summary.

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BankPulse Compliance Evidence Pack — generated 03 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly).
Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=5117&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.