Reserve Bank of India (Commercial Banks – Prudential Norms on Capital Adequacy) Eleventh Amendment Directions, 2026

RBI/2026-27/297 DOR.CAP.REC.251/21-02-002/2026-27 October 23, 2026 Reserve Bank of India (Commercial Banks – Prudential Norms on Capital Adequacy) Eleventh Amendment Directions, 2026 Please refer to 'Chapter VII: Leverage Ratio framework' of the Reserve Bank of India (Commercial Banks – Prudential Norms on Capital Adequacy) Directions, 2025 (hereinafter referred to as 'the Directions'). To ensure alignment with the latest leverage ratio framework ('leverage ratio 2017 standard') issued by the Basel Committee on Banking Supervision, there is a felt need to amend these Directions. 2. Accordingly, in exercise of the powers conferred by Section 35A of the Banking Regulation Act, 1949 and all other provisions / laws enabling the Reserve Bank of India to issue instructions in this regard, the Reserve Bank being satisfied that it is necessary and expedient in the public interest so to do, hereby, issues the Amendment Directions hereinafter specified. 3. These instructions shall be called the Reserve Bank of India (Commercial Banks – Prudential Norms on Capital Adequacy) Eleventh Amendment Directions, 2026. 4. These Amendment Directions modify the Directions as under: 4(1) Paragraph 262 shall be substituted with the following, namely: "262. The definition, minimum requirement, and the scope of application of the leverage ratio shall be as under: (1) The Basel III leverage ratio is defined as the capital measure (the numerator) divided by the exposure measure (the denominator), with this ratio expressed as a percentage: (2) The minimum leverage ratio for a domestic systemically important bank (D-SIB) shall be 4 per cent and 3.5 per cent for other banks. Branch of a global systemically important bank (G-SIB) in India (hereinafter referred to as 'G-SIB branch') shall maintain a leverage ratio of 3.5 per cent plus the leverage ratio buffer applicable to it as a G-SIB (including any additional leverage ratio buffer prescribed by the home regulator). (3) Capital distribution constraints will be imposed on a G-SIB branch which does not meet its leverage ratio buffer requirement. The capital distribution constraints imposed on the branch will depend on its common equity tier 1 (CET1) risk-based ratio and its leverage ratio as under: (i) A G-SIB branch which meets both its CET1 risk-based capital requirements (defined as a 5.5 per cent minimum requirement, a 2.5 per cent capital conservation buffer, the G-SIB higher loss-absorbency requirement, and countercyclical capital buffer, if applicable) and its Tier 1 leverage ratio requirement (defined as a 3.5 per cent leverage ratio minimum requirement and the G-SIB leverage ratio buffer) will not be subject to minimum capital conservation standards. (ii) A G-SIB branch which does not meet one of these requirements will be subject to the associated minimum capital conservation standards. (iii) A G-SIB branch which does not meet both requirements will be subject to the higher minimum capital conservation standard related to its risk-based capital requirement or leverage ratio. (4) The table below shows the minimum capital conservation standards for the CET1 risk-based requirements and Tier 1 leverage ratio requirements of a G-SIB branch in the first bucket of the higher loss-absorbency requirements (i.e., where a 1 per cent risk-based G-SIB capital buffer applies): CET1 risk-based ratio Tier 1 leverage ratio Minimum capital conservation ratios (expressed as a percentage of earnings) 5.5%–6.375% 3.5%–3.625% 100% > 6.375%–7.25% > 3.625%–3.75% 80% > 7.25%–8.125% > 3.75%–3.875% 60% > 8.125%–9% > 3.875%–4.0% 40% > 9.0% > 4.0% 0% (5) Both the capital measure and the exposure measure are to be calculated on a quarter-end basis. However, a bank may, subject to the Reserve Bank's approval, use more frequent calculations (e.g., daily or monthly averaging) as long as it does so consistently. (6) A bank shall meet the minimum leverage ratio requirement at all times." 4(2) Sub-paragraph (1) of paragraph 263 shall be substituted with the following, namely: "(1) The Basel III leverage ratio framework shall follow the same scope of regulatory consolidation, including consolidation criteria, as is used for the risk-based capital framework [refer to paragraph 8 of these Directions]." 4(3) For paragraphs 265 and 266, the following shall be substituted, namely: "265. General measurement principle (1) The leverage ratio exposure measure generally follows gross accounting values. Note - If a long settlement transaction is classified as a derivative according to the applicable accounting standards, the Basel III leverage ratio exposure measure has to be calculated according to paragraph 267 / 267A on 'Derivative exposures'. Similarly, if a failed trade is classified as a receivable according to the applicable accounting standards, the exposure measure has to be calculated according to paragraph 266 on 'On-balance sheet exposures'. Securities financing transactions (SFTs) that have failed to settle are e