The Reserve Bank relaxed the leverage ratio (LR) to 4% for Domestic Systemically Important Banks (DSIBs) and 3.5% for other banks. This has been done to help them boost their lending activities.
The reduced leverage ratio will be effective from the quarter commencing October 1, 2019.
The leverage ratio, as defined under Basel-III norms, is Tier-I capital as a percentage of the bank’s exposures.
Static/Current Takeaways Important For ESIC/EPFO Mains:
- RBI 25th Governor: Shaktikant Das, Headquarters: Mumbai, Founded: 1 April 1935, Kolkata.
Source: The Business Standard