The RBI has issued the Second Amendment Directions, 2026 for urban co-operative banks concerning the classification, valuation, and operation of investment portfolios, particularly related to non-SLR securities. This amendment emphasizes adaptation to regulatory requirements.
RBI Amends Directions on Urban Co-operative Banks' Investment Portfolio
On September 2, 2026, the Reserve Bank of India issued the Second Amendment Directions concerning the classification, valuation, and operation of investment portfolios held by urban co-operative banks. This amendment modifies the previous directions to incorporate new regulations regarding investments in non-SLR (Statutory Liquidity Ratio) securities.
The RBI's focus on regulating the investment portfolios of urban co-operative banks reflects its commitment to maintaining stability within the financial system and ensuring that these banks operate on a healthy financial footing. The amendments seek to streamline operations and provide clearer guidelines on permissible investment practices.
Legal practitioners representing urban co-operative banks will need to familiarize themselves with these changes and advise their clients accordingly. Compliance with the amended directions should be prioritized to mitigate the risks of non-compliance, which could result in adverse regulatory action.
Citations
- RBI Circular No. 249 (2026) DOR.MRG.REC.No.217/00-00-011