Hello everyone.... I am Meenakshi.
In this part we will learn some important points from JAIIB PPB: Unit – 2 : Banking Regulation
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1. RBI was constituted under the RBI Act 1934.
2. RBI started functioning with effect from 1 Apr
1935.
4. RBI has 4 Deputy Governors and 15 Directors
nominated by Union government.
5. All coins and Re 1 note is issued by Government
of India but put into circulation by RBI.
6. RBI manages the exchange rate between the Indian
Rupee and foreign currencies by selling and buying foreign exchange to/from
Authorised Dealers (RBI’s specified branches and other dealers).
7. Important macroeconomic policies:
Monetary and credit policies - issued by RBI
annually
Fiscal policy - issued by Ministry of Finance
EXIM policy - Ministry of Commerce
8. Saving and current accounts are demand
liabilities.
9. Reducing CRR reduces loanable funds with banks.
10. RBI can prescribe SLR from 0 to 40 percent of
bank’s DTL.
11. Increasing SLR reduces loanable funds with
banks.
12. Bank rate is the rate at which RBI is prepared
to buy or rediscount bills of exchange or other eligible commercial paper from
banks.
13. No bank held shares in a company as pledge or
mortgagee in excess of the limit of 30% of the paid-up capital of that company
or 30% of the bank’s Paid-up capital and reserves, whichever is less.
14. Open market operations refer to sale or purchase
of government securities by RBI in the open market.
15. Selective credit control is another tool which
RBI uses for monetary control. It prevents holding of essential commodities and
resultant rise in their prices. Presently buffer stocks of sugar, unreleased
stocks of sugar with sugar mills representing free sale sugar and levy sugar
are covered by SCC.
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