RBI finalizes Basel III market risk capital rules, adopts Simplified Standardised Approach

The Reserve Bank of India issued final Directions on minimum capital requirements for market risk under Basel III, adopting the Simplified Standardised Approach (SSA) for commercial banks. The final rules incorporate feedback on the February 2023 draft, signaling a shift to a more risk-sensitive framework. This matters as it sets the regulatory capital baseline for Indian banks' market risk, potentially affecting their trading book capital charges and risk management practices.