RBI wants better ALM monitoring from banks

Mumbai, Sep 5 (UNI) The Reserve bank today reiterated the need for better monitoring of asset-liability management (ALM) by banks and wanted the mismatches reported in a more effective manner.

As per the existing guidelines, the mismatches are not to exceed 20 per cent of the cash outflows in the respective time buckets.

In its notification, RBI directed to split the first time bucket, which is 1-14 days at present, into three time buckets- next day , 2-7 days and 8-14 days.

RBI has said the net cumulative negative mismatches during the next day, 2-7 days, 8-14 days and 15-28 days buckets should not exceed 5 percent, 10 percent, 15 percent and 20 percent of the cumulative cash outflows in the respective time buckets in order to recognise the cumulative impact on liquidity.

UNI