Wednesday, July 3, 2013

Banks to up provisioning for unhedged foreign currency exposures

The Reserve Bank of India on Tuesday introduced incremental provisioning and capital requirements for bank exposures to corporates having unhedged foreign currency exposures. These measures have been introduced as unhedged foreign currency exposure (UFCE) of corporates is a source of risk to them as well as to the financing banks and the financial system. Large unhedged forex exposures have resulted in accounts becoming non-performing in some cases............

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