Key Points
Mumbai: The banking system will need Rs 84,000 crore of excess capital due to revised unsecured loans risk weights introduced by the Reserve Bank of India, economists at the country's largest lender SBI said on Friday..
The decision to raise the risk weights perhaps is an attempt by the RBI to send out a strong message of addressing any incipient financial stability risks in the system, the SBI economists said in their report...
The report suggested that the measures by the RBI should be read as the restoring the status quo ante of 2019 because the central bank had reduced the risk weight on consumer credit (excluding credit card receivables) to 100 per cent from 125 per cent in September that year...
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