RBI had earlier announced the limits would be raised to ₹1 crore from ₹20 lakh.
Loans against shares, IPO funding and ESOP financing are often used for short-term speculation, and system-level caps help restrain excessive borrowing during market booms, preventing sharp build-ups of leveraged positions that can unwind abruptly if markets correct.
System-wide limits also reduce concentration and credit risk for banks, as large exposures to the same borrower across multiple lenders can result in simultaneous losses during market downturns, analysts said.
Also lowers borrowing limit for IPOs & Esops; clarifies on definition of acquisition finance
Separately, RBI said banks must obtain a corporate guarantee from the acquiring company in cases where acquisition finance is extended to a subsidiary or a special purpose vehicle.
The clarifications form part of revised amendment directions on capital market exposures, which RBI has deferred by three months to July 1 from April 1 after banks, capital market intermediaries and industry bodies raised operational and interpretational issues.
RBI said it had also issued clarifications to the rules, including expanding the definition of acquisition finance to cover mergers and amalgamations, and restricting such lending to acquisitions that result in control of a non-financial target company. On Monday, the central bank deferred the rollout of its revised capital market exposure rules by three months to July 1 after industry representations sought more time and clarity on operational issues.
RBI had originally set an April 1 start date for the amendments, which were aimed at easing bank financing for corporate acquisitions, rationalising loans against shares and units, and tightening norms for lending to capital market intermediaries.
