The Presidents/Chief Executive Officers

All Banks/ DFIs

Dear Sir/ Madam,

Minimum Capital Requirements: Regulatory Retail Portfolio Limit under Basel Framework

Please refer to the instructions contained in BSD Circular No. 05 dated February 14, 2008 regarding Minimum Capital Requirements.

The existing regulatory retail portfolio limit, as applicable under Basel Capital Framework, has been prescribed as Rs. 75 million under the above referred Circular. It has been decided to enhance this limit to Rs. 125 million with immediate effect. The subject revision of retail portfolio limit is expected to support the growth of credit to the retail sector and small & medium enterprises.

All other instructions, on the subject, shall remain unchanged.

Please acknowledge receipt.