RBI Unveils Draft Norms for Bank Dividends, Profit Remittance; Seeks Public Input

• RBI released draft "Prudential Norms on Dividend and Remittance of Profit Directions, 2026" on Jan 6, inviting public comments until Feb 5, 2026, effective FY27.
• New norms allow eligible banks to declare up to 75% of adjusted PAT as dividends, excluding extraordinary profits and factoring in NPAs.
• Foreign bank branches can remit net profits from Indian operations without prior RBI approval, with a clause for returning excess remittances.
• Applicable to commercial banks (public, private, foreign branches); excludes small finance, payment, regional rural, and local area banks.
• Eligibility requires maintaining regulatory capital, positive adjusted PAT, and no existing RBI restrictions.

Why It Matters: RBI's new draft norms aim to streamline dividend payouts and profit remittances for banks, seeking public feedback.