The Reserve Bank of India (RBI) has turned down requests from banks to spread provisions for potential mark-to-market (MTM) losses from treasury operations in the fourth quarter. This decision follows a significant rise in government bond yields, which increased by 45 basis points to close at 7.03% during the March quarter, alongside a $100 million cap on net open positions (NoP) imposed just before the financial year-end. Banks argued that the spike in yields was influenced by external factors, including the West Asia crisis, and sought an extension to the April 10 deadline for the NoP cap. However, the RBI rejected this request, emphasizing that it did not want the fiscal performance of one year to affect another. The March quarter was characterized by volatility, with the rupee depreciating 5% against the US dollar and equity indices dropping nearly 11%. Analysts expect that many banks will report limited treasury gains or even losses in this quarter due to these pressures, with profit growth projected at only 5% year-on-year. The RBI had previously allowed banks to spread MTM losses in 2018 under different conditions, but this time, the central bank opted to maintain stricter guidelines.