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Capital and provisioning requirements for exposures to entities with Unhedged Foreign Currency Exposure
February, 19th 2021

RBI/2020-21/100
DOR.No.MRG.BC.41/21.06.200/2020-21

February 17, 2021

All Scheduled Commercial Banks
(Excluding RRBs)

Dear Sir/Madam

Capital and provisioning requirements for exposures to entities with Unhedged Foreign Currency Exposure

Please refer to our circular DBOD.No.BP.BC.116/21.06.200/2013-14 dated June 3, 2014 on capital and provisioning requirements for exposures to entities with Unhedged Foreign Currency Exposure (UFCE).

2. The guidelines mandate that information on UFCE may be obtained by banks from entities on a quarterly basis, on self-certification basis, and preferably should be internally audited by the entity concerned. We have received representation from banks expressing their inability in obtaining UFCE certificates from listed entities for the latest quarter due to restrictions on disclosure of such information prior to finalisation of accounts.

3. In view of this, it has been decided that in such cases, banks may use data pertaining to the immediate preceding quarter for computing capital and provisioning requirements in case of Unhedged Foreign Currency Exposures.

4. All other instructions remain unchanged.

Yours faithfully,

(Usha Janakiraman)
Chief General Manager

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