Making it easier for urban cooperative banks to extend housing loans, Reserve Bank has relaxed the risk provisioning norm for purchase of residential properties up to Rs 30 lakh. The central bank issued notification on Monday in pursuance of the annual credit policy announcement made by Reserve Bank governor Y V Reddy on April 29. Earlier on May 15, the central bank had relaxed the risk provisioning norms for housing advances by the commercial banks. "It has been decided to enhance the limit of Rs 20 lakh to Rs 30 lakh in respect of bank loans for housing in terms of applicability of risk weights for capital adequacy purposes. Accordingly, such loans will carry a risk weight of 50%," Mr Reddy had said.
Courtesy: - ET dated: - 18th June 2008