(a) whether RBI has recently taken some monetary measures in regard to urban cooperative
banks and export refinance facilities;
(b) if so, the details thereof; and
(c) the other decision taken by RBI to improve liquidity of banks on CRR?
(a) whether RBI has recently taken some monetary measures in regard to urban cooperative
banks and export refinance facilities;
(b) if so, the details thereof; and
(c) the other decision taken by RBI to improve liquidity of banks on CRR?
THE MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI BALASAHEB VIKHE PATIL):
(a) and (b) Reserve Bank of India (RBI) has reported that it has announced several
measures specific to urban cooperative banks (UCBs) in the Monetary & Credit Policy,
2000-2001. These are:-
(i) Prohibiting the urban co-operative banks from lending directly or indirectly against
securities of shares either to individuals or to any other entity from 19-4-2001;
(ii) Restricting their borrowing in the call/notice money market on a daily basis to 2.0
per cent of aggregate deposit of the bank as at the end March of the previous financial
year;
(iii) Restricting them to keep fresh term deposits with other urban co-operative banks;
(iv) The proportion of Statutory Liquidity Ratio (SLR) holdings in the form of Government
and other approved securities as percentage of Net Demand and Time Liabilities (NDTL) to
be maintained by urban cooperative banks has been increased as detailed below:
Category of Investment in Government Urban Cooperative and other Banks approved securities (UCBs) as percentage of Net Demand and Time Liabilities (NDTL) Present Revised Scheduled UCBs 15% 20% Non-Scheduled UCBs UCBs with NDTL of 10% 15% Rs. 25 crore & above UCBs with NDTL of Nil 10% less than Rs. 25 crore
The measures relating to export refinance facility announced in the Monetary & Credit Policy do not relate to urban co-operative banks but for scheduled commercial banks only.
(c) In pursuance of the Monetary & Credit Policy, 2001-2002, the daily minimum requirement of 65% of Cash Reserve Ratio (CRR) has been reduced to 50% for the first seven days of the reporting fortnight; while continuing with the minimum requirement of 65% of the rest of the fornight; this minimum requirement will be applicable to ail seven days including the reporting Friday without any exception.
This measure will come into effect from the fortnight beginning August 11, 2001.