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The Reserve Bank of India establishes a Large Exposures Framework for All India Financial Institutions (AIFIs). These directions apply to EXIM Bank, NABARD, SIDBI, NHB, and NaBFID. AIFIs must maintain single counterparty exposure limits at 20 percent of their eligible capital base, with a 5 percent increase allowed for infrastructure loans. Group exposure limits are set at 25 percent, with a 10 percent increase for infrastructure. AIFIs must formulate board-approved policies, conduct annual reviews, and report large exposures monthly. The directions also set capital market exposure limits at 40 percent of net worth. These rules take effect immediately and replace previous concentration risk management guidelines.
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RBI/DOR/2025-26/326
DOR.CRE.REC.245/07-03-007/2025-26
November 28, 2025
Chapter I - Preliminary
Chapter II - Large Exposures Framework
Chapter III – Other Permitted exposures and Prudential Limits
Chapter IV - Repeal and other provisions
Annex I
In exercise of the powers conferred by Section 45L of the Reserve Bank of India Act, 1934, and all other provisions / laws enabling the Reserve Bank of India ('RBI') in this regard, RBI being satisfied that it is necessary and expedient in the public interest so to do, hereby, issues the Directions hereinafter specified.
These Directions shall be called the Reserve Bank of India (All India Financial Institutions - Concentration Risk Management) Directions, 2025.
These Directions shall come into effect immediately upon issuance.
(1) "Central counterparty" or "CCP" means a system provider, who by way of novation interposes between system participants in the transactions admitted for settlement, thereby becoming the buyer to every seller and the seller to every buyer, for the purpose of effecting settlement of their transactions.
(2) "Clearing member" means a member of, or a direct participant in, a CCP that is entitled to enter into a transaction with the CCP, regardless of whether it enters into trades with a CCP for its own hedging, investment or speculative purposes or whether it also enters into trades as a financial intermediary between the CCP and other market participants.
Explanation: For the purpose of these Directions, where a CCP has a link to a second CCP, that second CCP is to be treated as a clearing member of the first CCP. Whether the second CCP's collateral contribution to the first CCP is treated as initial margin or a default fund contribution will depend upon the legal arrangement between the CCPs. In such cases, if any, the Reserve Bank should be consulted for determining the treatment of this initial margin and default fund contributions.
(3) "Control" shall have the same meaning as assigned to it under clause (27) of Section 2 of the Companies Act, 2013 as amended from time to time.
(4) "Derivative" shall have the same meaning as assigned to it in Section 45U(a) of the Reserve Bank of India Act, 1934.
(5) "Eligible capital base" for the purposes of these Directions is the effective amount of Tier 1 capital fulfilling the criteria defined under Reserve Bank of India (All India Financial Institutions – Prudential Norms on Capital Adequacy) Directions, 2025, as per the last audited balance sheet. The infusion of capital after the published balance sheet date may also be taken into account for the purpose of exposure norms. Further, profits accrued during the year will be reckoned as Tier I capital for the purpose after making necessary adjustments as prescribed under Reserve Bank of India (All India Financial Institutions – Prudential Norms on Capital Adequacy) Directions, 2025.
Provided that the AIFI shall obtain an external auditor's certificate on completion of the infusion of capital and submit the same to the RBI (DOS) before reckoning the additions to eligible capital base.
(6) "Infrastructure projects / infrastructure lending" means any credit facility in whatever form extended by an AIFI to any infrastructure facility that is a project in any of the sectors incorporated in the latest updated Harmonized Master List of Infrastructure Sub-sectors published by the Government of India.
(7) "Large Exposure" means the sum of all exposure value of an AIFI measured in terms of paragraphs 25 to 43 of these Directions, to a counterparty and / or a group of connected counterparties, if it is equal to or above 10 per cent of the AIFI's eligible capital base.
(8) "Net worth" shall have the same meaning as assigned to it under clause (57) of Section 2 of Companies Act, 2013 as amended from time to time.
(9) "Qualifying central counterparty" or "QCCP" means an entity that is licensed to operate as a CCP (including a license granted by way of confirming an exemption) and is permitted by the appropriate regulator / overseer to operate as such with respect to the products offered. This is subject to the provision that the CCP is based and prudentially supervised in a jurisdiction where the relevant regulator / overseer has established, and publicly indicated that it applies to the CCP on an ongoing basis, domestic rules and regulations that are consistent with the CPSS-IOSCO Principles for Financial Market Infrastructures.
(10) "Subsidiary" shall have the same meaning as assigned under the extant Accounting Standards.
(11) "Trade exposures" include the current and potential future exposure of a clearing member or a client to a CCP arising from OTC derivatives, exchange traded derivatives transactions or SFTs, and initial margin. For the purpose of this definition, the current exposure of a clearing member includes the variation margin due to the clearing member but not yet received.
(1) to determine credit exposure limits of its refinancing portfolio;
(2) conditions under which exposure beyond 20 per cent of its eligible capital base to a single counterparty shall be permitted;
(3) determining connectedness among counterparties; and
(4) adopting internal ceiling, within the regulatory prescribed ceiling, for aggregate investment in equity of non-financial / commercial enterprises.
(1) The refinance portfolios of the AIFI.
