RBI cuts risk weight on new sub-section of residential housing

The Reserve Bank of India lowered the risk weight on a new sub-category of commercial real estate for residential housing to 75 per cent from 100 per cent earlier, it said in a notification on Friday.

The central bank carved out a new sub-sector -- commercial real estate-residential housing for loans to builders and developers of residential housing projects.

It also brought down the standard asset provisioning for the new residential housing segment to 0.75 per cent from 1 per cent.

In addition, the central bank also eased the prudential rules on risk-weight, provisioning for individual housing loans, for both residential and commercial real estate.

Copyright: Thomson Reuters 2013