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NPA Norms Extended to AIFIs: IRAC Guidelines Apply

Current · Source: Reserve Bank of India · RBI/2009-2010/364 · issued 26 Mar 2010 · ~1 min read
Quick answerRBI extended its September 2009 prudential norms on income recognition, asset classification, and provisioning (IRAC) for advances to select All-India Financial Institutions (AIFIs) like Exim Bank, NABARD, NHB, and SIDBI, effective immediately.
The rule, in the simplest words
How it plays out — a real example

A risk manager at NABARD in Mumbai reviews the institution's loan portfolio after the new rule. She sees that a large farm-loan account has been overdue for 90 days. Under the old rules, she might have classified it differently, but now she must apply the bank's IRAC norms, so she immediately marks it as a non-performing asset and calculates the required provisioning, which reduces the quarter's reported profit.

What changed

RBI directed that the IRAC guidelines issued to banks via circular DBOD.No.BP.BC.No.46/21.04.048/2009-10 dated September 24, 2009, shall apply mutatis mutandis to select AIFIs. This aligns NPA computation and provisioning norms for these institutions with those applicable to commercial banks.

What it means for you

AIFIs must now follow the same NPA recognition and provisioning rules as banks, ensuring uniformity in asset quality reporting. This could tighten their provisioning requirements and impact reported profitability, especially for institutions with higher delinquent advances.

What you must do

Who it affects

Exim Bank, NABARD, NHB, SIDBI, Other select All-India Financial Institutions

❓ Common questions

Which specific guidelines are being extended to AIFIs?

The circular extends the prudential norms on income recognition, asset classification, and provisioning pertaining to advances, as outlined in the September 24, 2009 bank circular, to select AIFIs.

When do these norms become effective for AIFIs?

The circular was issued on March 26, 2010, and the norms apply immediately from that date.

Do these norms apply to all financial institutions?

No, they apply only to select All-India Term-lending and Refinancing Institutions, specifically Exim Bank, NABARD, NHB, and SIDBI, as mentioned in the circular.

📜 Read the original circular — full text as issued by RBI
RBI/2009-2010/364 DBOD.No.FID.FIC.9/01.02.00/2009-10 March 26, 2010 The CEOs of the select All-India Term-lending and Refinancing Institutions (Exim Bank, NABARD, NHB and SIDBI) Dear Sir Prudential Norms on Income Recognition, Asset Classification, and Provisioning pertaining to Advances- Computation of NPA Levels Please find enclosed a copy of Circular DBOD.No.BP.BC.No.46/21.04.048/2009-10 dated September 24, 2009 on the above subject. In this connection, it is advised that the above guidelines issued to banks, shall mutatis mutandis apply to the select All India Financial Institutions (AIFIs). Yours faithfully (Vinay Baijal) Chief General Manager Encl.: As above
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2009-2010/364 · issued 26 Mar 2010. The plain-English explanation above is BankPulse’s own independent summary.
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Worked example & action-note template

Example: if you are a Credit Manager at a bank this circular applies to (Exim Bank, NABARD, NHB, SIDBI, Other select All-India Financial Institutions), your first concrete step on “NPA Norms Extended to AIFIs: IRAC Guidelines Apply” is: “Review your institution's current asset classification and provisioning practices against the September 2009 bank guidelines.” (RBI issued this 26 Mar 2010).

  1. Circular: RBI/2009-2010/364 -- NPA Norms Extended to AIFIs: IRAC Guidelines Apply
  2. Issued: 26 Mar 2010
  3. Action required: Review your institution's current asset classification and provisioning practices against the September 2009 bank guidelines.
  4. Action required: Update internal policies and systems to align NPA computation with the bank-level IRAC norms.
  5. Action required: Train credit and risk teams on the revised classification and provisioning rules.
  6. Action required: Prepare for potential impact on capital adequacy and profitability due to stricter provisioning.
  7. Owner: ____________ Target date: ____________
  8. Board/committee approval needed? Y / N
  9. Evidence filed in compliance register on: ____________
Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.

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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=5550&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.
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