Norms issued by RBI for banks, NBFCs to set up infrastructure debt funds

1) Infrastructure debt funds(IDFs) would be set up either as mutual funds (MFs) or NBFCs

2)  NBFC sponsoring IDF-Mutual Fund should have a minimum net owned funds (NOF) of Rs.300 crore and capital adequacy ratio of 15 per cent.

3) Net non performing assets(NPAs) should be less than 3 per cent of net advances and the NBFCs should have been in existence for at least five years and earning profits for the last three years .

4) Banks acting as sponsors to IDF-MFs would be subject to existing prudential limits including limits on investments in financial services companies and limits on capital market exposure .

5) For the setting up of IDF-NBFC by banks and non-banking finance institutions, sponsors of NBFC-IDFs will have to contribute a minimum equity of 30 per cent and a maximum equity of 49 per cent of the IDF-NBFC.

6) The IDF should be assigned a minimum credit rating ‘A' or equivalent of CRISIL, FITCH, CARE, ICRA or equivalent rating by any other accredited rating agencies and Tier II capital cannot exceed Tier I.

7) The maximum capital exposure that an IDF can take to a borrower or a group of borrowers will be at 50% of its total capital funds

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