Bond loss: RBI eases provisioning norms |ForumIAS

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Context

The Reserve Bank of India (RBI) has decided to ease the provisioning norms for bond losses for third and fourth quarters of 2017-18

Backdrop

Rising bond yields

What has happened?

RBI has now allowed banks to spread bond losses, incurred in 3^rd and 4^th quarters, over four quarters subject to certain terms

Terms by RBI

The RBI has set certain terms

Banks that use the option must make suitable disclosures in their notes to accounts/quarterly results providing details of the provisions for depreciation of the investment portfolio for the quarters ended December 2017 and March 2018 made during the quarter/year and the balance required to be made in the remaining quarters