What changed
The Reserve Bank of India has amended its directions on financial statements and disclosures for urban co-operative banks. The changes include new disclosure requirements for exposures to related parties. A new table must be included in the notes to accounts, detailing loans and contracts with related parties. This includes aggregate values of loans sanctioned, outstanding loans, and provisions held.
What it means for you
The amendments aim to enhance transparency and accountability in urban co-operative banks' financial reporting. By disclosing exposures to related parties, banks will provide stakeholders with a clearer understanding of their credit risk management practices. This increased transparency can help maintain public trust and confidence in the banking system.
What you must do
- Review the amended directions and understand the new disclosure requirements
- Update financial statement templates to include the new table on exposures to related parties
- Ensure compliance with the amended directions by April 1, 2026
Who it affects
Urban co-operative banks, Bank management, Auditors and accountants
What is the effective date of the amended directions?
April 1, 2026
What type of disclosures are required for related parties?
Loans and contracts with related parties, including aggregate values and provisions held