It will also be considered as claim on the government with zero risk weight for meeting capital adequacy norms.
This wavier should be transferred to a separate account, and can be treated as performing asset only if adequate provision is made for the loss in Present Value (PV) terms.
The government is expected to release the first tranche of the total repayment, estimated at Rs 60,000 crore, around September.
The discount rate for arriving at the loss in PV terms should be taken as 9.56 per cent, which is the yield to maturity on 364-day Treasury Bills today, the central bank said in its late night communication to banks.
Those farmers covered under the relief scheme will pay 75 per cent of the eligible amount as their share, while the government will contribute the remaining amount. Such accounts will be treated as a performing account, the RBI added.
By Mr Chitranjan, Section Banking & RBI
Posted on Thu Jul 31, 2008 at 02:20:13 AM EST
 |
| < The Great Tax Rush At Pragati Maidan, 1 lakh file income tax returns a day before deadline | Mutual funds (MFs) Change Tack To Attract Investors Into New Funds > |
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
