RBI Asks HFCs to Ensure Availability of Full Cover for Public Deposits Collected by Them
Moneylife Digital Team
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Bringing housing finance companies (HFCs) under closer scrutiny, while safeguarding interests of investors and depositors, the Reserve Bank of India (RBI) has issued master directions. These directions cover maintenance of liquidity coverage ratio, risk management, asset classification and loan-to-value ratio for HFCs. Amidst the increasing concern of investor-depositors, the central bank has also asked HFCs to always ensure that there is full cover available for public deposits accepted by them.
“In case HFC fails to repay any public deposit or part thereof as per the terms, it shall not grant any loan or other credit facility or make any investment or create any other asset as long as the default exists,” the RBI says.