RBI moots revision in capital charge norms for counterparty credit risks

Mumbai, Aug 20, 2025

The revision pertaining to CCR is proposed to largely align with the Basel Committee on Banking Supervision (BCBS) guidelines, reflecting the development and depth of the respective market segments

The Reserve Bank of India (RBI) has proposed to expand the ambit of capital charge applicable to banks for counterparty credit risks (CCR) to cover derivatives in equity, precious metals, except gold and other commodities. It has also specified the credit conversion factor to make capital provision for dealing with such derivatives. At present, norms about capital charge for CCR deal with interest rate contracts, exchange rate contracts and derivatives.

The revision pertaining to CCR is proposed to largely align with the Basel Committee on Banking Supervision (BCBS) guidelines, reflecting the development and depth of the respective market segments. The norms were last revised in August 2008.

The RBI said that banks acting as clearing members of stock exchanges, recognised by Securities and Exchange Board of India (Sebi), in the equity derivatives and commodity derivatives segments are required to maintain capital charge for CCR.

[The Business Standard]