Forward Contracts and risk management: authorised dealers must verify exposures, maintain board approved safeguards and report to the regulator Authorised dealers may enter into forward and other permitted derivative contracts with residents and specified non residents under FEMA schedules, contingent on documentary verification of exposures, board approved risk management policies, and prescribed reporting to the Reserve Bank. Dealers writing options or arranging commodity hedges must ensure full coverage, obtain required one time approvals, and certify underlying exposures. Banks may open non interest rupee accounts for overseas branches, fund such accounts from overseas correspondents at market rates subject to monitoring, and undertake inter bank foreign exchange transactions within board approved limits and RBI approved open position and gap constraints.
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Forward Contracts and risk management: authorised dealers must verify exposures, maintain board approved safeguards and report to the regulator
Authorised dealers may enter into forward and other permitted derivative contracts with residents and specified non residents under FEMA schedules, contingent on documentary verification of exposures, board approved risk management policies, and prescribed reporting to the Reserve Bank. Dealers writing options or arranging commodity hedges must ensure full coverage, obtain required one time approvals, and certify underlying exposures. Banks may open non interest rupee accounts for overseas branches, fund such accounts from overseas correspondents at market rates subject to monitoring, and undertake inter bank foreign exchange transactions within board approved limits and RBI approved open position and gap constraints.
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