{"id":64742,"date":"2023-04-05T16:29:07","date_gmt":"2023-04-05T10:59:07","guid":{"rendered":"https:\/\/enterslice.com\/learning\/?page_id=64742"},"modified":"2023-04-05T16:29:08","modified_gmt":"2023-04-05T10:59:08","slug":"rbi-issues-master-circular-in-regard-to-guarantees-co-acceptances-letters-of-credit-ucbs","status":"publish","type":"page","link":"https:\/\/enterslice.com\/learning\/newsletter\/rbi-issues-master-circular-in-regard-to-guarantees-co-acceptances-letters-of-credit-ucbs\/","title":{"rendered":"RBI Issues Master Circular in Regard to Guarantees, Co-Acceptances &#038; Letters of Credit &#8211; UCBs"},"content":{"rendered":"<p>On 01st April 2023, the Reserve Bank of India (RBI) issued the Master Circular &ndash; Guarantees, Co-Acceptances &amp; Letters of Credit &ndash; UCBs.<\/p>\n\n\n\n<p>The Master Circular states the following &ndash;<\/p>\n\n\n\n<ul><li>It directs the UCBs to confine their guarantees to relatively short-term maturities; the Guarantees should not be issued for periods exceeding ten years in any case.<\/li><li>The entire volume of outstanding guarantee commitments at any time may not exceed 10% of the bank&rsquo;s total owned resources, which include paid-up capital, reserves, and deposits. Under the overall ceiling, the proportion of unsecured guarantees outstanding at any given moment may be limited to 25% of the bank&rsquo;s owned funds (paid-up capital + reserves) or 25% of the entire amount of guarantees, whichever is less.<\/li><li>It states that the Banks should issue secured guarantees.<\/li><li>The Banks should ensure that the systems evolved for recording the details of off-balance sheet transactions are properly followed by all branches. These records should be periodically balanced and internal inspectors should verify the same and offer critical comments.<\/li><li>The Banks should avoid undue concentration of unsecured guarantee commitments to particular groups of customers and\/or trades. The bank&rsquo;s Board of Directors should fix suitable proportions for the issuance of unsecured guarantees on behalf of any individual constituent so that these guarantees do not exceed the following namely &ndash;<\/li><\/ul>\n\n\n\n<p>(i) A reasonable proportion of the total obligations in respect of unsecured guarantees provided by the bank to all such constituents at any time,<\/p>\n\n\n\n<p>(ii) Reasonable multiple of the shareholdings in the bank<\/p>\n","protected":false},"excerpt":{"rendered":"<p>On 01st April 2023, the Reserve Bank of India (RBI) issued the Master Circular &ndash; Guarantees, Co-Acceptances &amp; Letters of Credit &ndash; UCBs. The Master Circular states the following &ndash; It directs the UCBs to confine their guarantees to relatively short-term maturities; the Guarantees should not be issued for periods exceeding ten years in any [&hellip;]<\/p>\n","protected":false},"author":60,"featured_media":64743,"parent":62999,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"download-newsletter.php","meta":[],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v14.6.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>RBI Issues Master Circular in Regard to Guarantees, Co-Acceptances &amp; Letters of Credit - UCBs<\/title>\n<meta name=\"description\" content=\"On 01st April 2023, the Reserve Bank of India (RBI) issued the Master Circular - Guarantees, Co-Acceptances &amp; Letters of Credit \u2013 UCBs.\" \/>\n<meta name=\"robots\" content=\"index, follow\" \/>\n<meta name=\"googlebot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta name=\"bingbot\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/enterslice.com\/learning\/newsletter\/rbi-issues-master-circular-in-regard-to-guarantees-co-acceptances-letters-of-credit-ucbs\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"RBI Issues Master Circular in Regard to Guarantees, Co-Acceptances &amp; Letters of Credit - UCBs\" \/>\n<meta property=\"og:description\" content=\"On 01st April 2023, the Reserve Bank of India (RBI) issued the Master Circular - Guarantees, Co-Acceptances &amp; Letters of Credit \u2013 UCBs.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/enterslice.com\/learning\/newsletter\/rbi-issues-master-circular-in-regard-to-guarantees-co-acceptances-letters-of-credit-ucbs\/\" \/>\n<meta property=\"og:site_name\" content=\"Enterslice\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/enterslice\" \/>\n<meta property=\"article:author\" content=\"omvir\" \/>\n<meta property=\"article:modified_time\" content=\"2023-04-05T10:59:08+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/enterslice.com\/learning\/wp-content\/uploads\/2023\/04\/RBI-Issues-Master-Circular-in-Regard-to-Guarantees-Co-Acceptances-Letters-of-Credit-UCBs.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"920\" \/>\n\t<meta property=\"og:image:height\" content=\"483\" \/>\n<meta name=\"twitter:card\" content=\"summary\" \/>\n<meta name=\"twitter:creator\" content=\"@enterslice\" \/>\n<meta name=\"twitter:site\" content=\"@enterslice\" \/>\n<!-- \/ Yoast SEO plugin. -->","_links":{"self":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/pages\/64742"}],"collection":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/users\/60"}],"replies":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/comments?post=64742"}],"version-history":[{"count":0,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/pages\/64742\/revisions"}],"up":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/pages\/62999"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/media\/64743"}],"wp:attachment":[{"href":"https:\/\/enterslice.com\/learning\/wp-json\/wp\/v2\/media?parent=64742"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}