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English हिन्दी ಕನ್ನಡ മലയാളം தமிழ் తెలుగు
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Home News Stocks
RBI tightens the screws on gold NBFCs yet again; stocks plunge
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Gold
Muthoot Finance: Quotes, News
BSE 3309.30BSE Quote154.3 (-4.66%)
NSE 3320.20NSE Quote165 (-4.97%)
Manappuram Finance: Quotes, News
BSE 262.10BSE Quote9.3 (-3.55%)
NSE 262.35NSE Quote9.7 (-3.70%)
Close on the heals of new KYC norms and new loan to value norms, the Reserve Bank of India has decided to intervene once again in norms for gold NBFC's, by asking banks to reduce exposure to any single gold loan NBFC from the existing 10% to 7.5% of their capital funds.

Shares of the gold loan NBFCs like Muthoot Finance dropped 0.94% and Manappuram dropped 2.04% on BSE at 10.10 am IST.

"Banks should have an internal sub-limit on their aggregate exposure to all such NBFCs, having gold loans to the extent of 50 per cent or more of their total financial assets, taken together," the RBI said in the statement.

RBI has constituted a Working Group to undertake a detailed study of gold demand, trends in gold prices and lending by NBFCs against gold.

RBI's concerns over gold import and after noticing surge in the growth marked by NFBCs in the recent years, both in terms of their balance sheet size and physical presence.

Earlier, the RBI had asked NBFC gold loan companies to reduce their Loan to value (LTV) to 60% for loans against collateral of gold jewellery.

GoodReturns.in

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Story first published: Wednesday, April 18, 2012, 10:48 [IST]
See More On: gold, rbi, muthoot, manappuram
Other articles published on Apr 18, 2012

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