The Reserve Bank on Wednesday proposed changes to the rules governing the foreign exchange positions of banks. According to an official statement, the amendments to the Net Open Position (NOP) were made after a comprehensive review of the existing instructions. NOP refers to the difference between banks’ total foreign currency assets and liabilities, which reveals their exposure to currency fluctuations or exchange rate risk. RBI said the proposed guidelines are more closely aligned with the Basel Committee on Banking Supervision (BCBS) standards. It added that RBI will ensure consistent implementation across regulated entities. The amendments include eliminating separate offshore/onshore NOP calculations and inclusion of accumulated surplus from overseas operations in the NOP. It is also proposed to modify the shorthand method for maintenance of foreign exchange risk capital charge on actual NOP and calculation of NOP in line with the Basel guidelines, which considers open positions in gold separately. There is also a provision to exempt some structural foreign exchange positions from NOP, the central bank said.