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RBI/2018-19/82
DNBR (PD) CC.No.95/03.10.001/2018-19
November
29, 2018
All NBFCs
Madam/Sir,
Relaxation on the guidelines to
NBFCs on securitisation transactions
Please refer to the Guidelines
on Securitisation Transactions vide paragraph 102 of Master Directions on Non-Banking Financial Company -
Systemically Important Non-Deposit taking Company and Deposit taking
Company (Reserve Bank) Directions dated September 01, 2016 and
paragraph 89 of Non-Banking Financial Company
–Non-Systemically Important Non-Deposit taking Company (Reserve Bank)
Directions dated September 01, 2016.
2. In order to encourage NBFCs
to securitise/assign their eligible assets, it has been decided to relax
the Minimum Holding Period (MHP) requirement for originating NBFCs, in
respect of loans of original maturity above 5 years, to receipt of
repayment of six monthly instalments or two quarterly instalments (as
applicable), subject to the following prudential requirement:
Minimum Retention Requirement
(MRR) for such securitisation/assignment transactions shall be 20% of the
book value of the loans being securitised/20% of the cash flows from the
assets assigned.
3. The above dispensation shall
be applicable to securitisation/assignment transactions carried out during
a period of six months from the date of issuance of this circular. Other
terms and conditions of the above referred Directions remain the same.
Yours faithfully
(Manoranjan Mishra)
Chief General Manager
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