The RBI today eased norms for maintaining risk weights on bank lending to non-banking finance companies or NBFCs. The RBI also announced harmonization of different categories of NBFCs to provide them with higher flexibility in their operations. Shares of L&T Financial Holding, Manappuram Finance and Muthoot Finance climbed 6% after the RBI announcement. Also read RBI Monetary Policy: Key highlightsRBI will issue detailed guidelines in this regard by the end of February 2019. Aligning NBFCs' (non-banking financial companies') risk weights to cost of bank borrowings will go a long way in correcting the distortions."

Source: Mint February 07, 2019 08:26 UTC