TITLE: India's Reserve Bank Issues Revised Amendment Directions on Commercial Bank Capital Market Exposures
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On March 30, 2026, the Reserve Bank of India (RBI) issued the Reserve Bank of India (Commercial Banks – Financial Statements: Presentation and Disclosures) – Third Amendment Directions, 2026 (Revised). The revised directions modify disclosure requirements for commercial banks' financial statements, specifically addressing capital market exposures.
The amendment revises paragraph 10(5) titled 'Exposures' under Chapter III (Disclosure in Financial Statements – Notes to Accounts) of the Reserve Bank of India (Commercial Banks – Financial Statements: Presentation and Disclosures) Directions, 2025. The RBI deleted the existing sub-paragraph 10(5)(ii) and inserted a new comprehensive disclosure table for capital market exposures.
The new disclosure framework requires banks to report 11 categories of capital market exposure, including: direct investments in equity, preference shares, convertible bonds, and non-debt mutual fund schemes; advances to individuals for investment in shares and convertible instruments; advances secured by shares or convertible securities; credit facilities to capital market intermediaries; acquisition finance; financing to non-debt mutual fund schemes; bridge finance for equity contributions; underwriting commitments; irrevocable payment commitments issued by custodian banks; and trade exposures from clearing member activities. Banks must compute capital market exposure in accordance with the Reserve Bank of India (Commercial Banks – Concentration Risk Management) Directions, 2025 and the Reserve Bank of India (Commercial Banks – Credit Facilities) Directions, 2025.
The revised amendments come into force from the date a bank decides to implement the Reserve Bank of India (Commercial Banks – Credit Facilities) Amendment Directions, 2026 (Revised) dated March 30, 2026, or from July 1, 2026, whichever is earlier. These provisions supersede the previous Third Amendment Directions, 2026 dated February 13, 2026.