The Reserve Bank of India allowed banks to dip further into statutory cash reserves in a bid to ease a liquidity squeeze afflicting the nation’s money markets. The move by the central bank follows concerns over tight liquidity conditions and banks’ unwillingness to lend to NBFCs.
As per the RBI, banks could ‘carve out’ up to 15% of holdings under the statutory liquidity reserves to meet their liquidity coverage ratio (LCR) requirements as compared to 13% now.
Source- The Hindu Business Line
Static/Current Takeaways Important for Indian Bank PO Exam 2018-
- Urjit Patel- 24th Governor of RBI, Headquarters- Mumbai, Established on- 1st April 1935, in Kolkata.