RBI issues multiple amendment directions in 2026 to standardise classification, valuation, and portfolio management for all categories of financial institutions.
RBI Harmonises Investment Portfolio Standards Across Regulated Entities
The Reserve Bank of India has issued a series of amendment directions in September 2026, updating the framework for classification, valuation, and operation of investment portfolios for All India Financial Institutions, Commercial Banks, Small Finance Banks, Payments Banks, Local Area Banks, and Regional Rural Banks. These stem from the 2025 Directions, particularly Chapter IX on fair valuation principles.
The amendments aim to ensure uniformity, transparency, and risk sensitivity in how financial institutions value securities and manage investment books. Key changes include enhanced disclosure norms, revised haircut requirements for collateralised instruments, and standardised methods for marking-to-market in illiquid segments.
These regulatory refinements require immediate review by internal audit and compliance departments. Legal advisors must guide institutions on updated governance responsibilities, including board oversight and stress testing disclosures. The move reflects RBI’s intent to strengthen financial stability through consistent asset valuation.
Citations
- RBI (Commercial Banks - Classification, Valuation, and Operation of Investment Portfolio) Third Amendment Directions, 2026
- RBI (Small Finance Banks - Second Amendment Directions, 2026)
- RBI (Payments Banks - Second Amendment Directions, 2026)