What changed
The all-in-cost ceiling for ECB, previously set in March 2012, will remain in force until September 30, 2013. This is an extension of the existing cap, not a revision. The ceiling will be reviewed again after that date.
What it means for you
Banks and borrowers can continue using the same cost limits for ECB until end-September 2013, providing regulatory stability. No new pricing flexibility or tightening is introduced. Lenders should plan their ECB pipelines within the current ceiling until further notice.
What you must do
- Continue applying the existing all-in-cost ceiling for ECB approvals and disbursements.
- Inform corporate clients and constituents about the extension of the ceiling.
- Monitor RBI announcements for the post-September 30 review.
- Ensure compliance with all other unchanged ECB policy aspects.
Who it affects
AD Category-I banks, Corporate borrowers using ECB, ECB lenders and arrangers
What is the all-in-cost ceiling that has been extended?
The ceiling was specified in A.P. (DIR Series) Circular No. 99 dated March 30, 2012. This circular extends its applicability until September 30, 2013.
Does this circular change any other ECB rules?
No. All other aspects of ECB policy remain unchanged as per the circular.
Who is responsible for communicating this to customers?
AD Category-I banks are directed to bring the contents of this circular to the notice of their constituents and customers.