Uniform 50% risk weight for PPP and post-COD infra assets

RBI/2011-12/581 DNBS.PD.CC.No.276/03.02.089/2011-12 May 30, 2012 All Infrastructure Finance Companies Uniformity in Risk weight for assets covering PPP and post COD projects The Reserve Bank, vide its notification No.DNBS.233/CGM(US)-2011 dated November 21, 2011 viz; Infrastructure Debt Fund-Non-Banking Financial Companies (Reserve Bank) Directions, 2011 issued detailed guidelines with regard to regulation of IDF-NBFCs.In terms of the Guidelines,for the purpose of computing capital adequacy, IDF-NBFCs are permitted to assign a risk weight of 50 percent on bonds covering PPP and post commercial operations date (COD) projects in existence over a year of commercial operation. 2.In order to bring uniformity in regulations in this regard, it has been decided to extend the above reduction in risk weight to all Infrastructure Finance Companies (IFCs) for assets covering PPP and post COD projects which have completed at least one year of satisfactory commercial operations. 3.Copy of the amending notification No. DNBS.246/CGM (US)-2012 of date is enclosed for meticulous compliance. Yours faithfully, (Uma Subramaniam) Chief General Manager In-Charge R ESERVE BANK OF INDIA DEPARTMENT OF NON-BANKING SUPERVISION CENTRAL OFFICE CENTRE I, WORLD TRADE CENTRE, CUFFE PARADE, COLABA, MUMBAI, 400 005. Notification No.DNBS(PD). 246 / CGM(US)-2012 dated May 30, 2012 The Reserve Bank of India, having considered it necessary in public interest and being satisfied that, for the purpose of enabling the Bank to regulate the credit system to the advantage of the country, it is necessary to amend the Non-Banking Financial (Non-Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007 (hereinafter referred to as the said Directions), contained in Notification No. DNBS. 193/DG(VL)-2007 dated February 22, 2007, in exercise of the powers conferred by section 45JA of the Reserve Bank of India Act, 1934 (2 of 1934) and of all the powers enabling it in this behalf, hereby directs that the said Directions shall be amended with immediate effect as follows, namely – In para 20, a new sub-para shall be inserted after sub-para 13, as follows:- “(14) For Infrastructure Finance Companies, the risk weight for assets covering PPP and post commercial operations date (COD) projects which have completed at least one year of satisfactory commercial operations shall be at 50 percent”. (Uma Subramaniam) Chief General Manager-in-Charge

Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2011-12/581 · issued 30 May 2012. The plain-English explanation above is BankPulse’s own independent summary.

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