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Policy | RBI withdraws NBFCs’ special borrowing norms

Policy | RBI withdraws NBFCs’ special borrowing norms
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First Published: Wed, Feb 03 2010. 11 59 PM IST
Updated: Wed, Feb 03 2010. 11 59 PM IST
Mumbai: The Reserve Bank of India (RBI) on Wednesday withdrew the special short-term foreign currency borrowings facility for non-banking financial companies (NBFCs) and housing finance companies. The central bank made the decision after reviewing the macroeconomic conditions and improvements in the domestic credit and liquidity conditions, it said in a statement. The facility was extended to these companies after the September 2009 collapse of US-based investment bank Lehman Brothers’ Holdings Inc., which led to a global liquidity crunch. RBI had allowed these companies to raise short-term foreign currency borrowings of up to 50% of their net owned funds, comprising paid-up equity capital and reserves, or $10 million, whichever was higher.
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First Published: Wed, Feb 03 2010. 11 59 PM IST