rediff.com

NewsApp (Free)

Read news as it happens
Download NewsApp

Available on  

Rediff News  All News 
Rediff.com  » Business » Kamath disagrees with SBI Chairman, says CRR is not an issue

Kamath disagrees with SBI Chairman, says CRR is not an issue

Last updated on: August 30, 2012 14:11 IST

Kamath disagrees with SBI Chairman, says CRR is not an issue

     Next

Next

ICICI Bank Chairman K V Kamath on Thursday disagreed with the suggestion of SBI chief Pratip Chaudhuri that RBI should scrap CRR, saying it is part of the monetary policy and no issue can be made of it.

Asked to comment on the vocal slugfest between Chaudhuri and RBI Deputy Governor K C Chakrabarty on the issue, Kamath said in the whole issue of monetary policy, several tools are being used, including Statutory Liquidity Ratio (SLR) and Cash Reserve Ratio.

CRR is the portion of deposits kept by banks with the Reserve Bank on which no interest is paid.

Click NEXT to read more...


Photographs: Reuters

     Next

Kamath disagrees with SBI Chairman, says CRR is not an issue

Prev     Next
Prev

Next

"I think the monetary authority (RBI) in its wisdom uses all these tools as appropriate and that's what is being done. This (CRR) is nothing new. India always had a CRR for as long as I can remember and I don't think honestly (there is) an issue to be made here", he told reporters.

"You should look at it (CRR) as part of monetary policy that it is exercised and part of it is liquidity policy for the banks", added Kamath, also non-executive Chairman of Infosys Ltd.

Earlier, he addressed the eighth India Innovation & Summit, organised by CII.

Click NEXT to read more...


Photographs: Rupak De Chowdhuri/Reuters

Prev     Next

Kamath disagrees with SBI Chairman, says CRR is not an issue

Prev     Next
Prev

Next

Last week, made a strong pitch for the abolition of CRR, saying that keeping required funds with the Reserve Bank without any interest was costing the banking system about Rs 21,000 crore (Rs 210 billion).

He called for phasing out of CRR, saying it would allow banks to lower lending rates. If the RBI can't do away with it, it should at least pay some interest on CRR since banks pay their depositors, he had said.

Click NEXT to read more...




Prev     Next

Kamath disagrees with SBI Chairman, says CRR is not an issue

Prev     More
Prev

More

Chaudhuri had also contended that "the CRR policy has possibly denied the country growth, income and employment", and argued that since RBI does not pay any interest on CRR, this acts as a tax on the banking system.

Chakrabarty had this week frowned on Chaudhuri's contention on phasing out CRR. "If the SBI chairman is not able to do business as per our regulatory environment, he has to find some other place," he had said.


Photographs: Rediff Archives
Tags: CRR , SBI , Chaudhuri , RBI , Kamath

Prev     More
© Copyright 2014 PTI. All rights reserved. Republication or redistribution of PTI content, including by framing or similar means, is expressly prohibited without the prior written consent.