RBI lets AD banks exclude swap-facility positions from NOP-INR limit compliance
AD Category-I bank treasury and risk teams may exclude FCNR(B) and ECB/OFCB swap-facility positions from NOP-INR limit calculations, and must update position-monitoring logic accordingly
Change
On 8 June 2026, the Reserve Bank of India (RBI) issued A.P. (DIR Series) Circular No. 13, allowing Authorised Dealer Category-I banks to exclude swap positions arising from the new FCNR(B) deposit and ECB/OFCB swap facilities when complying with the Net Open Position in INR (NOP-INR) limit under A.P. (DIR Series) Circular No. 24 of 27 March 2026.
Why it matters
The circular is the enabling complement to the two swap facilities issued the same day: without it, positions taken under those facilities would consume a bank's NOP-INR limit and cap how much it could swap. By excluding those positions from the NOP-INR computation under the March 2026 circular, RBI removes that constraint. AD Cat-I bank treasury and risk teams must reconfigure NOP-INR position-monitoring to carve out qualifying swap-facility positions, while continuing to apply the limit to all other positions.
Implications
- — AD Category-I bank treasury and market-risk teams must update NOP-INR position-monitoring systems to exclude swap positions arising under the FCNR(B) and ECB/OFCB swap facilities, or they will understate available headroom and unnecessarily constrain use of those facilities.
- — Risk and compliance teams must ensure the exclusion is applied only to positions arising under the two named circulars (S-56 and S-57) while continuing to apply the NOP-INR limit per A.P. (DIR Series) Circular No. 24 of 27 March 2026 to all other positions, or risk mis-stating the bank's regulatory net open position.
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