RBI Proposes New Norms for Calamity Resolution Plans by Banks, NBFCs

• RBI issues draft norms for regulated entities (REs) to design and implement resolution plans during natural calamities.
• The proposed guidelines aim to rationalize existing prudential norms and harmonize regulatory instructions for different REs.
• REs will have complete discretion in designing resolution plans, considering decisions from SLBC/DCC.
• A dedicated window is prescribed for invoking the resolution framework and implementing the Resolution Plan.
• Restructured exposures under relief measures will remain 'Standard' with reduced specific provisioning; REs must ensure banking services in affected areas.

Why It Matters: RBI proposes principle-based resolution framework for REs during natural calamities, offering discretion and timely relief.