Reserve Bank of India (RBI) - Gr8AmbitionZ

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7/27/2013 11:42 PM

Reserve Bank of India (RBI) - Gr8AmbitionZ

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T U E S D AY, A P R I L 2 4 , 2 0 1 2

Reserve Bank of India (RBI)

BI, India's Central Bank came into existence on 1stApril 1935 as a private share holders bank. Note : 1st Central Bank in the world : Rick's Bank Sweden in 1656. But in the light of unctions, Bank of England is the 1st Central Bank 1694. Functions of RBI : Monopoly of Note issue Banker, Adviser and Agent to the Govt. of India Banker to Banks Custodian of Foreign exchange and gold. Re-discounts bills of exchange and hundis. Lender of last Resort Maintains stability of foreign value of Rupee. Acts as clearing house Credit control

Here are some important points to remember about RBI :

RBI's central office is in Mumbai. RBI has 22 regional offices. It was nationalized on 1st January 1949. It prints Currency in 15 Languages. Its predecessor was Imperial Bank of India (1921). RBI came into existence on the recommendation commission as per RBI act 1934. of Hilton Young (Royal)

It is the member bank of Asian Clearing Union (ACU) and IMF (International Monetary Fund). RBI has Board of Directors with 21 (Governor and 4 Deputy Governors etc) The present Governor of RBI is Duvvuri Subba Rao (Second Time). Deputy Governors :

K.C.Chakravarthi Urjit Patel Anand Sinha Harun Rashid Khan.

Currency notes are issued by RBI under "Minimum Reserve System 1957" with backing of Rs. 200 Cr Reserve (Gold : Rs. 115 Cr + Foreign Securities Rs. 85 Cr) RBI Invests foreign exchange reserves in multi-currency, multi-market portfolios such as securities, other central banks and Bank of International Settlements (BIS) and deposits in foreign commercial banks. The yield on such investments is low. RBI does not pay interest on Govt. deposits with it. The following monetary instruments are in the hands of RBI to control credit and to bring economic stability in the economy : Bank Rate : Rate of rediscount at which the RBI discounts the first class bills of exchange brought by the banks. Repo Rate : Injection of liquidity by the RBI is termed as " Repo Rate" . This was introduced in Dec. 1992 and Reverse Repo Rate in Nov. 1996. RBI buys Govt. Securities for a short period usually a fortnight, with an agreement to sell it later. Thus repo rate is a short-term money market instrument to stabilize short term liquidity in the economy.

7/27/2013 11:42 PM

Reserve Bank of India (RBI) - Gr8AmbitionZ

http://www.gr8ambitionz.com/2012/04/reserve-bank-of-india-rbi.html

Reverse Repo Rate Repo Rate is the rate at which the RBI lends to commercial banks where as the Reverse Repo Rate is the rate at which the RBI borrows from the commercial banks against securities for a very short period. Repo and Reverse Repo rates are used as policy instruments for day-to-day liquidity management under the liquidity adjustment facility. Cash Reserve Ratio (CRR) : It refers to the percentage of net demand and time deposits which the scheduled commercial banks have to keep with RBI at zero interest Rate as per RBI act 1934. Statutory Liquidity Ratio (SLR) : It refers to the percentage of net demand and time deposits which the scheduled commercial banks have to keep with themselves. i.e. by purchasing Govt. Securities or in the form of cash or gold as per Banking Regulation Act 1949, Sec 24. SLR is a mechanism used by Commercial Banks for providing credit to the Govt. Open market operations : RBI buys or sells Govt. Bonds in the second Ratio. RBI Amendment Bill 2005 provides flexibility to RBI in fixing the CRR and SLR. Though RBI is responsible for the safety and stability of the Banking sector, it is not legally independent.

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12 comments:
Malik Ehsan ul ellahi November 4, 2012 at 4:19 PM

7/27/2013 11:42 PM

Reserve Bank of India (RBI) - Gr8AmbitionZ

http://www.gr8ambitionz.com/2012/04/reserve-bank-of-india-rbi.html

Give it in PDF format please Reply

Anonymous November 21, 2012 at 8:44 PM these notes are just worth it. thanks alot . one can revise from them easily Reply

Anonymous December 6, 2012 at 1:09 PM please give it in pdf format Reply

Indu Babu December 6, 2012 at 6:07 PM Imperial Bank of India is the Predecessor of State Bank of India not RBI. SBI traces its ancestry to British India, through the Imperial Bank of India, to the founding in 1806 of the Bank of Calcutta, making it the oldest commercial bank in the Indian Subcontinent. Bank of Madras merged into the other two presidency banksBank of Calcutta and Bank of Bombayto form the Imperial Bank of India, which in turn became the State Bank of India. The Government of India nationalised the Imperial Bank of India in 1955 with the Reserve Bank of India taking a 60% stake, and renamed it the State Bank of India. Reply Replies Shiv RK December 8, 2012 at 11:17 AM

Thanks for the comment Indu Babu. I think we've already uploaded this in the Short Notes on State Bank of India.... Good Day :) Reply

Anonymous January 8, 2013 at 10:50 PM thanks mam Reply

Anonymous January 8, 2013 at 10:53 PM thanks Reply

Anonymous January 8, 2013 at 10:57 PM thanku Reply

Anonymous February 16, 2013 at 10:31 PM thanks for giving notes abt rbi pls give more details abt ibps clerk interview my name is arun from sivkasi Reply

rekha agarwal June 12, 2013 at 1:16 PM pdf formate plzzz Reply

Anonymous July 12, 2013 at 9:48 PM Thanks.... Reply

Anonymous July 20, 2013 at 7:36 PM

7/27/2013 11:42 PM

Reserve Bank of India (RBI) - Gr8AmbitionZ

http://www.gr8ambitionz.com/2012/04/reserve-bank-of-india-rbi.html

in rbi assistants material imperial bank of india is known as rbi its totally wrong please note this frends... imperial bank of india is sbi Reply Add comment

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