Overnight Net Exchange Position Limit/Factor Sensitivity Limits for Spot FX
NOOPL may be fixed by the boards of the respective banks and communicated to the Reserve Bank immediately. However, such limits should not exceed 25 percent of the total capital (Tier I and Tier II capital) of a bank. This limits the maximum allowable excess of assets plus exchange bought contracts over liabilities plus exchange sold contracts (“overbought” position) and the reverse (“oversold” position) that may be carried overnight in foreign currencies.