Unique Code For Corporate Borrowers

BE/RBI/39/2017

Reserve Bank of India, has come out with the statement that corporate borrowers having exposure of Rs 5 crore and above will have to mandatorily obtain 20-digit Legal Entity Identifier (LEI) from banks, a move that is aimed at improving risk management.  Further the RBI release adds that

• The timeline for implementing the LEI, is that the borrowers with fund and non-fund exposure of Rs 1,000 crore and above will have to get the unique code by March 31, 2018.
• Borrowers who have exposure between Rs 500 crore and Rs 1,000 crore have to obtain the LEI code by June 30 and those having between Rs 100 crore and Rs 500 crore by March 31, 2019.
• Further, the borrowers with bank credit between Rs 50 crore and Rs 100 crore are permitted time till December 2019 to comply with LEI provision.

OTHER CONDITIONS:

1. Banks shall advise their existing large corporate borrowers who have a total exposures of Rs 50 crore and above to obtain LEI.
2. A separate roadmap for borrowers having exposure between Rs 5 crore and up to Rs 50 crore would be issued in due course.
3. Also, it has been decided that borrowers who do not obtain LEI as per the schedule should not be granted renewal/enhancement of credit facilities.

NOTE:

LEI is a 20-digit unique code to identify parties to financial transactions worldwide. The code is conceived as a key measure to improve the quality and accuracy of financial data systems for better risk management post the global financial crisis.