(a) whether the RBI has raised the ceiling on bank dividend payment ratio to 40
percent;
(b) if so, the details thereof;
(c) whether the RBI has developed any mechanism to ensure that their increase is
not misused by the banks; and
(d) if so, the details thereof?
MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI S.S. PALANIMANICKAM)
(a) & (b) Reserve Bank of India has issued guidelines on 4th May, 2005 raising the
dividend payout ratio to 40% for banks which comply with the minimum
prudential requirements i.e. CRAR, Net NPA, provisions of Section 15 & 17 of
Banking Regulation Act, 1949 etc. These guidelines are available at RBI website
www.rbi.org.in.
(c) & (d) : RBI has prescribed a reporting system whereby all banks declaring dividend
are required to report, in the prescribed proforma, details of dividend declared
during the accounting year within a fortnight of such declaration.