The Reserve Bank of India (RBI) on November 28, 2025, issued the Reserve Bank of India (All India Financial Institutions – Concentration Risk Management) Directions, 2025.
The following has been stated namely: -
• It aims to mitigate systemic risks arising from excessive exposure concentrations. These Directions apply to all-India financial institutions (AIFIs) such as EXIM Bank, NABARD, SIDBI, NHB, and NaBFID.
• They mandate that AIFIs establish comprehensive risk management frameworks to monitor and control exposures to individual borrowers, groups, sectors, and connected parties.
• The guidelines set prudential limits on large exposures, define the eligible capital base for calculating these limits, and require regular internal assessments and audits.
• AIFIs are also expected to maintain diversified portfolios and ensure that their lending and investment practices do not lead to undue concentration risks.
• These Directions are effective immediately upon issuance and aim to enhance the resilience of AIFIs against sectoral shocks and interconnected financial risks.
• This shall come into force from November 28, 2025.
[Notification no. - RBI/DOR/2025-26/326 DOR.CRE.REC.245/07-03-007/2025-26]
