The Reserve Bank of India has issued amendments to the credit risk management framework for all financial institutions, focusing on the assessment and resolution of stressed assets. This update aims to strengthen financial stability.
RBI Amends Credit Risk Management Directions for All Financial Institutions
On April 29, 2026, the Reserve Bank of India (RBI) issued the "All India Financial Institutions – Credit Risk Management Second Amendment Directions, 2026". These amendments follow earlier directives concerning the resolution of stressed assets, aligning regulatory focus on credit risk assessment and management.
The second amendment introduces revised protocols related to the classification of stressed assets, ensuring timely intervention mechanisms are in place to manage risk effectively. The amendments cite section 45L of the Reserve Bank of India Act and other relevant statutes as the legal basis for these changes.
These updates reflect the RBI's ongoing commitment to enhance the financial stability of all financial institutions in India, particularly in light of rising stressed assets across the sector.
Practitioners must familiarize themselves with these amendments to provide consistent advice to clients on credit risk policies and compliance with the updated regulatory framework.
Citations
- Reserve Bank of India (All India Financial Institutions – Credit Risk Management) Second Amendment Directions (2026)
