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RBI Circular No: RBI/2016-17/317 (07-Jun-17) Individual Housing Loans: Rationalisation of Risk-Weights and Loan to Value (LTV) Ratios

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DBR.BP.BC.No.72/08.12.015/2016-17

All Commercial Banks

(Excluding Regional Rural Banks and Local Area Banks)

Madam/Dear Sir,

Individual Housing Loans: Rationalisation of Risk-Weights and Loan to Value (LTV) Ratios

Please refer to the Second Bi-monthly Monetary Policy Statement for 2017-18, announced today.

2. As a countercyclical measure, the LTV ratios, risk weights and standard asset provisioning rate for individual housing loans sanctioned on or after the date of this circular shall be as under:

Outstanding loan LTV ratio (%) Risk Weight (%) Standard Asset Provision (%)
Up to Rs.30 lakh 80 35 0.25
> 80 and 90 50
Above Rs.30 lakh and up to Rs.75 lakh 80 35
Above Rs.75 lakh 75 50

3. The LTV ratios, Risk Weights and Standard Asset Provision set out in the circular DBR.BP.BC.No.44/08.12.015/2015-16 dated October 8, 2015, on the captioned subject, shall continue to apply to loans sanctioned up to June 6, 2017.

4. All other instructions referred to in the above mentioned circular remain unchanged.

Yours faithfully,

S.S. Barik

Chief General Manager in-Charge

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