RBI LIMITS INTER-BANK LIABILITIES

With a view to control the concentration risk on the liability side of banks, the Reserve Bank of India (RBI) has stipulated limits for Inter-Bank Liabilities (IBL). As per the guidelines, the IBL of every bank should not exceed 200% of its net worth as on March 31 of the previous year. However, the banks, who enjoy a Capital to Risk Adjusted Ratio ( CRAR ) of at least 25% more than the minimum CRAR ( 9% ) i.e. 11.25% as on March 31 of the previous year, have been permitted to have a higher limit up to 300% of the net worth of RBI.