The RBI has issued final guidelines implementing the Basel Committee’s Leverage Ratio 2017 Standard, following stakeholder consultations on the draft directions issued in August 2026.
RBI Finalizes Guidelines on Leverage Ratio 2017 Standard
The Reserve Bank of India has finalized guidelines on the implementation of the ‘Leverage Ratio 2017 Standard’ issued by the Basel Committee on Banking Supervision (BCBS). This follows the circulation of draft directions in August 2026 and subsequent stakeholder consultations.
The framework sets a minimum leverage ratio requirement to complement risk-based capital adequacy norms. It limits excessive leverage in the banking sector and improves resilience during periods of financial stress. The leverage ratio is calculated as Tier 1 capital divided by exposure measure, including off-balance-sheet items.
After reviewing feedback, the RBI has incorporated certain operational clarifications and effective timelines. The final directions enhance alignment of Indian banks with international regulatory standards, supporting financial stability and cross-border comparability of capital metrics.
