Reserve Bank issues rules for HFCs

The RBI on Wednesday issued directives to housing finance companies (HFCs) on maintenance of liquidity coverage ratio, risk management, asset classification and loan-to-value ratio. It said the directions, took immediate effect and were aimed at protecting the interests of investors and depositors. “All non-deposit taking HFCs with asset size of ₹100 crore and above and all deposit taking HFCs shall pursue liquidity risk management, [adhering] to gap limits, making use of liquidity risk monitoring tools and adoption of stock approach to liquidity risk.”