Banks and development finance institutions (DFIs) exposure to equity market is governed by a PR which disallows exposures against the security issued by the bank itself or those by prospective borrowers themselves or provide unsecured credit to finance the floatation of securities or take exposure against non-listed securities and sponsor directors’ shares.
Banks investment in any single scrip is limited to 5% of their own equity with total investment in listed shares is capped at 20%. The margin requirement against the security of shares of listed companies has been set at 30%.