RBI says banks' group entities cannot be used to circumvent norms

The Reserve Bank of India (RBI) has issued a directive stating that banks cannot use their group entities to bypass regulatory requirements. The RBI's new guidelines aim to ensure that banks follow prudential norms and do not engage in practices that could undermine the financial system's integrity. This decision comes in the wake of concerns about some banks leveraging group entities to circumvent lending restrictions and other compliance rules. The RBI has emphasized the need for robust risk management and corporate governance practices to prevent potential systemic risks.