New criteria for classification, valuation of investment portfolio of banks proposed

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Mumbai, Jan 14 (PTI) The Reserve Bank of India (RBI) on Friday proposed new norms for classification and valuation of investment portfolios of banks to align them with global prudential framework and accounting standards.

As per the proposed norms, the investment portfolio of banks will be divided into three categories – Hold to Maturity (HTM), Available for Sale (AFS), and Fair Value Through Profit and Loss Account (FVTPL).

As per the Basel-3 framework, ‘Place for Business’ (HFT) will be a sub-category within the FVTPL.

RBI’s new bank portfolio classification norms will come into effect from April 1, 2023, and comments have been sought from stakeholders by February 15.

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