New Delhi, Jan. 28 -- The Reserve Bank of India (RBI) may relax the Liquidity Coverage Ratio or LCR norms to inject additional liquidity into the banking system according to a report by Jefferies.

The apex bank may also ease the proposed tightening of LCR norms which in their current form may compel banks to shift about Rs 7 trillion from loans to government securities (G-Sec) or other liquid assets.

The report suggests that one option for RBI could be to include the Cash Reserve Ratio (CRR) as part of liquid assets calculation. This move could benefit banks as Indian banks already hold relatively higher liquid assets. Another approach could be to implement the new LCR norms in a staggered manner, giving banks more time to adjust.

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