Current Affairs · Banking & Financial Regulations
A commercial bank is assessing its regulatory compliance and capital requirements for Irrevocable Payment Commitments (IPCs) and Capital Market Exposure (CME) under the RBI Directions. Which of the following statements correctly describe the exposure calculation or capital requirements? 1. Irrevocable Payment Commitments are treated as financial guarantees with a Credit Conversion Factor (CCF) of 50%. 2. For the calculation of intraday exposure, T+1 net settlement obligations are assessed at a 30% exposure rate. 3. For overnight T+2 net settlement obligations, the exposure is assessed at a 25% calculation rate. 4. A risk weight of 125% must be applied to the portion of the IPC that is considered as Capital Market Exposure. Select the correct option:
- 11, 2, and 4 only
- 23 and 4 only
- 32 and 4 only✓
- 41 and 2 only
Correct answer
2 and 4 only
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