The RBI issued Eleventh Amendment Directions on November 23, 2026, updating leverage ratio frameworks for commercial banks to align with global 'Leverage Ratio 2017 Standard', enhancing prudential regulation.
RBI Updates Capital Adequacy Leverage Ratio Norms
The Reserve Bank of India (RBI) issued the Reserve Bank of India (Commercial Banks – Prudential Norms on Capital Adequacy) Eleventh Amendment Directions, 2026, on October 23, 2026. The amendment revises Chapter VII on the Leverage Ratio framework to align with the 'Leverage Ratio 2017 Standard' recommended by the Basel Committee on Banking Supervision.
The updated framework strengthens the leverage ratio calculation by refining exposure measures, adjusting treatment of derivative contracts, and incorporating off-balance sheet items more comprehensively. Banks must report compliance on a consolidated basis and ensure minimum leverage ratio thresholds are met at all times.
These amendments reflect RBI’s commitment to global regulatory harmonization and financial stability. Legal and compliance teams must review internal risk models, disclosure practices, and board reporting templates for consistency with the revised norms. The change underscores the growing complexity of prudential banking regulation in India, particularly for systemically important institutions.
