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AIFI Capital Adequacy: CCR Norms Aligned with Global Standards

Current · Source: Reserve Bank of India · RBI/2025-26/241 · issued 10 Mar 2026 · ~2 min read
Quick answerRBI has amended AIFI capital adequacy directions to align counterparty credit risk (CCR) treatment with international standards. Key changes include revised add-on factors for market-related off-balance sheet items, clarified consolidation scope, and updated QCCP trade exposure risk weights.
The rule, in the simplest words
How it plays out — a real example

Rohan, a gold‑loan officer at a regional bank in Indore, starts his day by reviewing the bank’s consolidated CCR exposures. He notices that the bank’s Mumbai subsidiary has large interest‑rate swap contracts and adds those exposures to the consolidated calculation, applying the new 5 % add‑on factor for 3‑year swaps. By doing so, Rohan ensures the bank meets the updated capital requirement before the quarter‑end, giving his team peace of mind.

What changed

RBI inserted a note requiring AIFIs to include CCR exposures of all entities required to be consolidated under Chapter II when computing capital on a consolidated basis. Table 13 add-on factors for Interest Rate Contracts, Exchange Rate Contracts and Gold, Equities, Precious Metals except Gold, and Other Commodities were revised with new percentage bands by residual maturity. Notes were added clarifying that add-on factors apply to all outstanding CCR exposures, specifying that AIFIs acting as clearing members of SEBI-recognized exchanges must compute CCR capital charge per paragraph 77, and defining Precious Metals (Silver, Platinum, Palladium) and Other Commodities (energy, agricultural, base metals, etc.). The risk weight for AIFI trade exposure to a QCCP was set at 2% for own purposes and when offering clearing services with reimbursement obligations.

What it means for you

AIFIs must now ensure consolidated CCR capital calculations capture exposures from all entities in the consolidation scope, increasing capital requirements for groups with significant off-balance sheet derivatives. The revised add-on factors will change capital charges for market-related contracts, particularly for longer maturities and commodities, potentially raising costs for certain trading books. The 2% QCCP risk weight provides clarity and relief for clearing members, but AIFIs must verify their reimbursement obligations to qualify.

What you must do

Who it affects

All India Financial Institutions (AIFIs) subject to capital adequacy directions, AIFIs acting as clearing members of SEBI-recognized stock exchanges, AIFIs with consolidated subsidiaries or entities in their capital adequacy scope, AIFIs dealing in OTC derivatives, exchange-traded derivatives, and securities financing transactions (SFTs)

❓ Common questions

What is the effective date of these amendments?

The Second Amendment Directions, 2026, come into effect from the date of issue, i.e., March 10, 2026.

Do the revised add-on factors apply to all CCR exposures or only new contracts?

The new note (e) clarifies that add-on factors per Table 13 shall be applicable to all outstanding CCR exposures, not just new ones.

What risk weight applies to an AIFI's trade exposure to a QCCP?

A risk weight of 2% applies to the AIFI's trade exposure to a QCCP for its own purposes and when offering clearing services with an obligation to reimburse clients for losses if the QCCP defaults.

📜 Read the original circular — full text as issued by RBI
RBI/2025-26/241 DOR.MRG.REC.No.436/21-01-002/2025-26 March 10, 2026 Reserve Bank of India (All India Financial Institutions (AIFIs) - Prudential Norms on Capital Adequacy) Second Amendment Directions, 2026 Please refer to paragraph 77 on ‘Treatment of total counterparty credit risk’ of the Reserve Bank of India (All India Financial Institutions (AIFIs) - Prudential Norms on Capital Adequacy) Directions, 2025 . It has been decided to amend these instructions to provide greater clarity and to largely align them with international standards. 2. Accordingly, in exercise of the powers conferred by Section 45L of the Reserve Bank of India Act, 1934, and all other provisions / laws enabling the Reserve Bank of India (RBI) in this regard, RBI being satisfied that it is necessary and expedient in the public interest so to do, hereby, issues the Amendment Directions hereinafter specified. 3. (i) These instructions shall be called the Reserve Bank of India (All India Financial Institutions (AIFIs) - Prudential Norms on Capital Adequacy) Second Amendment Directions, 2026. (ii) These Amendment Directions shall come into effect from the date of issue. 4. The Reserve Bank of India (All India Financial Institutions (AIFIs) - Prudential Norms on Capital Adequacy) Directions, 2025 , are amended as provided below: 4.1. In paragraph 77(1), the following note shall be inserted in the end, namely: – “Note: For computation of capital requirement on a consolidated basis, an AIFI shall include CCR exposures of all entities required to be consolidated in terms of Section B ‘Scope of application of capital adequacy framework’ under Chapter II of these Directions.”. 4.2. Table 13 in paragraph 77(2) shall be substituted by the following, namely: – “Table 13: Add-on factors for Market-Related Off-Balance Sheet Items (see paragraph 197 for CDS exposures)
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2025-26/241 · issued 10 Mar 2026. The plain-English explanation above is BankPulse’s own independent summary.
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Who does what — compliance checklist
⚙️ Operations
  • Ensure clearing members of SEBI-recognized exchanges compute CCR capital charge per paragraph 77 for equity and commodity derivatives.
  • Verify QCCP trade exposure risk weight eligibility (2%) and document reimbursement obligations for client clearing services.
💻 IT / Systems
  • Review and update consolidated CCR capital computation to include exposures of all entities required to be consolidated under Chapter II.
  • Recalculate capital charges using the revised Table 13 add-on factors for all outstanding market-related off-balance sheet items.
Grouped from the action items above — a single circular may involve more than one team.
Worked example & action-note template

Example: if you are an IT/Systems lead at a bank this circular applies to (All India Financial Institutions (AIFIs) subject to capital adequacy directions, AIFIs acting as clearing members of SEBI-recognized stock exchanges, AIFIs with consolidated subsidiaries or entities in their capital adequacy scope, AIFIs dealing in OTC derivatives, exchange-traded derivatives, and securities financing transactions (SFTs)), your first concrete step on “AIFI Capital Adequacy: CCR Norms Aligned with Global Standards” is: “Review and update consolidated CCR capital computation to include exposures of all entities required to be consolidated under Chapter II.” (RBI issued this 10 Mar 2026).

  1. Circular: RBI/2025-26/241 -- AIFI Capital Adequacy: CCR Norms Aligned with Global Standards
  2. Issued: 10 Mar 2026
  3. Action required: Review and update consolidated CCR capital computation to include exposures of all entities required to be consolidated under Chapter II.
  4. Action required: Recalculate capital charges using the revised Table 13 add-on factors for all outstanding market-related off-balance sheet items.
  5. Action required: Ensure clearing members of SEBI-recognized exchanges compute CCR capital charge per paragraph 77 for equity and commodity derivatives.
  6. Action required: Verify QCCP trade exposure risk weight eligibility (2%) and document reimbursement obligations for client clearing services.
  7. Owner: ____________ Target date: ____________
  8. Board/committee approval needed? Y / N
  9. Evidence filed in compliance register on: ____________
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Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=13331&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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