In all such cases, the borrower will deemed to be a ‘Specified borrower’ from April 1, 2016 and the disincentive mechanism will be applicable from April 1, 2017 if the borrower borrows from the banking system beyond the NPLL.

As the disincentive mechanism will be applicable from the FY succeeding the FY in which a borrower becomes a ‘specified borrower’, the disincentive mechanism will be applicable from April 1, 2017 for any borrowing from the banking system beyond the NPLL.

Borrower are free to raise their funding needs from any source at any level.

Yes, ECB and Trade Credit raised from overseas branches of Indian banks will count towards ASCL.

Ans: Bonds subscribed by banks and which meet the criteria specified in circular dated April 23, 2010 will continue to be classified under HTM category.

No, additional risk weight on incremental exposure merely on account of borrower being classified as specified borrower, should not normally result in change in credit rating.

Ans: In cases of accounts with ASCL above the cut-off where S4A is implemented, both the sustainable and unsustainable debt (Parts A & B) should be counted towards calculating ASCL.

Restructured accounts where cut-off ASCL is achieved/likely to be achieved due to additional finance under the restructuring package under JLF and other RBI frameworks, should not be subjected to disincentive mechanism for the incremental exposure.

Yes, subscription to the market instruments in the primary market will be considered to determine exposures beyond NPPL.