For Quick Alerts
ALLOW NOTIFICATIONS  
For Daily Alerts

RBI Makes Revision In Family Pension Rules For Bank Employees: Check Report

|

For employees of its member banks covered by the 11th Bipartite Settlement and Joint Note of November 11, 2020, the family pension of bank employees was amended. The additional liability on account of revision in family pension consequent to the aforementioned settlement should be fully recognised and charged to the Profit and Loss Account in the current financial year. However, IBA has expressed that it would be difficult for some banks to absorb the large amount involved in a single year, said RBI in a circular issued on 4th October 2021. The RBI stated that the concerns were evaluated from a regulatory standpoint and that as an unprecedented circumstance, banks covered by the aforementioned settlement may take the following action in the subject.

 
RBI Makes Revision In Family Pension Rules For Bank Employees: Check Report
  • The liability for enhancement of family pension shall be fully recognised as per applicable accounting standards.
  • The expenditure, as indicated in paragraph 2 above, may, if not fully charged to the Profit and Loss Account during the financial year 2021-22, be amortised over a period not exceeding five years beginning with the financial year ending March 31, 2022, subject to a minimum of 1/5th of the total amount involved being expensed every year.
  • Appropriate disclosures of the accounting policy followed in this regard shall be made in the 'Notes to Accounts' to the financial statements. The Notes to Accounts shall also disclose the amount of unamortised expenditure and the consequential net profit if the unamortised expenditure had been fully recognised in the Profit & Loss Account.

Several banks have urged the RBI to clarify the amount of capital funds that can be raised overseas, according to another circular of the apex bank. According to the RBI, the issue has been examined, and it has been clarified that the "eligible amount" for the purpose of issuing Perpetual Debt Instruments (PDI) in foreign currency is the higher of 1.5 percent of Risk-Weighted Assets (RWAs) and Total Additional Tier 1 capital as of March 31 of the previous financial year. The Reserve Bank further said that no more than 49% of the "eligible amount" can be issued in foreign currency and/or in rupee-denominated bonds outside of India.

Read more about: rbi pension employees
Story first published: Tuesday, October 5, 2021, 12:32 [IST]
Company Search
Get Instant News Updates
Enable
x
Notification Settings X
Time Settings
Done
Clear Notification X
Do you want to clear all the notifications from your inbox?
Settings X