Capital Adequacy Standards and Risk Management Guidelines
The Reserve Bank of India has issued guidelines for standalone Primary Dealers, covering capital funds, capital requirements, risk management, and regulatory reporting.
Capital Funds: The guidelines outline the composition of Tier-I and Tier-II capital, including guidelines on Subordinated Debt (SD) Bonds.
Capital Requirements: The minimum Capital to Risk-Weighted Assets Ratio (CRAR) is specified, along with the measurement of risk-weighted assets.
Risk Management: The guidelines cover risk reporting for derivative business and provide risk weights for on-balance sheet assets, off-balance sheet items, interest rate contracts, and foreign exchange contracts.
Regulatory Reporting: Primary Dealers are required to submit regular reports on their capital adequacy, including annexures A to F.
Diversification: The guidelines encourage diversification of Primary Dealer activities, with an appendix providing additional details.
Annexures: The circular includes several annexures, including A to F, which provide additional information and templates for reporting.
Chat with the Master Circular: