Now urban co-operative banks won’t be able to expose more than 15% of their total deposits to the realty sector. This restriction has been clamped on Wednesday by the Reserve Bank of India.
The Reserve Bank of India issued a circular to this effect which states that no urban co-operative bank would be allowed to expose its total deposits more that what it has been stipulated by the RBI to the realty sector in the form of individual housing loans, commercial real estate etc.
The said circular also states that those loans provided by urban co-operative banks to customers in lieu of immoveable property as security will also come under the ambit of real estate loans.
To determine whether the loan has been availed for commercial real estate or not, the repayment source provided by the loan customer will be taken into consideration. The 15% ceiling will be based on the total amount of deposits with a bank as on March 31st during 2009-10 which has been duly audited.
The effect of this RBI endorsed change on the real estate industry will be known in due course of time.
The Reserve Bank of India issued a circular to this effect which states that no urban co-operative bank would be allowed to expose its total deposits more that what it has been stipulated by the RBI to the realty sector in the form of individual housing loans, commercial real estate etc.
The said circular also states that those loans provided by urban co-operative banks to customers in lieu of immoveable property as security will also come under the ambit of real estate loans.
To determine whether the loan has been availed for commercial real estate or not, the repayment source provided by the loan customer will be taken into consideration. The 15% ceiling will be based on the total amount of deposits with a bank as on March 31st during 2009-10 which has been duly audited.
The effect of this RBI endorsed change on the real estate industry will be known in due course of time.
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