The Reserve Bank on Friday set up a three-member committee under former Governor Bimal Jalan to scrutinise applications for new bank licences, which are expected to be awarded by January.
The Reserve Bank of India (RBI) has decided to give new banking licences to create more capacity and competition in the Indian banking space but the right size is yet to be determined. "The right size of a bank remains a debate for the industry," said Deputy Governor Subir Gokarn.
The discussion on new banking licences will be posted on the website of the central bank for public comments, RBI governor D Subbarao said while unveiling the monetary policy for 2010-11.
The RBI cut interest rates on Friday by a quarter point for the third time since January.
The spurt in banking may be short-lived because of his limited options
The word 'balancing' seems to be a favourite of Reserve Bank of India Governor D Subbarao.
Broader markets ended weak with mid-caps falling 0.4 per cent while small-caps declined 1.3 per cent on the BSE.
The government-appointed Financial Sector Legislative Reforms Commission (FSLRC) has recommended a slew of reforms to overhaul the sector.
Panagariya, who heads the government's main economic advisory body NITI Aayog, is also India's Group of 20 summit negotiator
Upside risks to inflation persist from higher growth and expansive govt spending.
The government has changed the criteria for infusion of capital.
The government is "extremely disappointed" with the latest report of the Moody's rating agency on India's economic outlook. The report, a senior government official said, was highly contradictory and called the rating agency's credibility into question. Referring to the Moody's statement that "India's fiscal strength remains a key weakness in the sovereign credit profile...", the official remarked: "How can my strength be my weakness? Moreover, they are unwilling to have a like-to-like comparison with India."
Acceding to the demand of banks, the Reserve Bank of India on Friday deferred the date of implementation of the proposed base rate model to July 1 and also exempted three category of loans from the new system.
Urjit Patel's reappointment will raise market hopes that Rajan, will also be offered an extension when his tenure ends in September.
'...because it is still a legal tender.'
The Reserve Bank is in touch with various banks to understand why lending rates are not coming down despite the central bank cutting policy rates, even as the bankers expressed inability to lower the rates when bond yields remain high.
Reserve Bank of India Governor D Subbarao said on Friday that another stimulus package could help the economy in the short-term but a sustainable recovery required the government to return to fiscal consolidation.
The RBI is expected to respond to some bankers' demand for abolition of cash reserve ratio, the amount of money which banks are required to keep with the central bank in cash.
New-generation private sector banks such as ICICI, HDFC, Axis, Kotak etcetera owe their existence to the recommendations of the first Narasimham Committee.
'We still need a certain number of large public sector banks for financial inclusion and stability purposes.'
The RBI Board on Friday approved the transfer of Rs 57,128 crore as surplus to the central government for the accounting year 2019-20, the central bank said in a statement.
Reserve Bank of India's former governor Raghuram Rajan on Wednesday joined Rahul Gandhi during the Congress-led Bharat Jodo Yatra in Rajasthan.
Inflation target remains 5% for January 2017.
Reserve Bank of India Governor D Subbarao on Tuesday said that unwinding of excess liquidity would need to be carefully calibrated once the economy recovered.Comparing the RBI's steps with other central banks, Subbarao said the speed and scale of monetary response was more aggressive than many other countries.The RBI has lowered the repo rate, the rate at which it lends to banks, from a peak of 9 per cent to 5.5 per cent in less than five months.
Subbarao was delivering the second Business Standard Lecture in New Delhi, immediately after releasing Business Standard India 2011, the fourth volume of the annual India series published by BS Books, a division of Business Standard Limited.
In FY24, loans given out by such firms had topped a whopping Rs 146,517 crore, up by 49 per cent year-on-year and spread over 10.19 million accounts (up 35 per cent).
Reserve Bank of India Deputy Governor K C Chakrabarty has said that there is plan to cover all the villages through mobile banks by 2015.
'India's fundamentals are a lot better (than those of other emerging market economies).' 'India will suffer (witness a fall in its stock market) what I call the second order effect.' 'And the second order will happen when these funds (belonging to macro and hedge fund investors and which have leveraged Japanese yen-carry trades), because they lose money elsewhere as lot of their positions were financed by borrowing Japanese yen, will have to book profits in investment destinations where they are making money, including in markets like India.' 'They (these investors) will have to effectively sell in countries like India and which is the consequence (the crash in equity markets) that Indian markets might see.'
Despite its admirable competence and proven track record, the RBI doesn't have the capacity to supervise an economy that's growing so fast and becoming larger by the year, points out T C A Srinivasa Raghavan.
Central bank estimate economy to grow at 5.5 per cent.
US Federal Reserve Chairman Ben S Bernanke held talks with RBI Governor Duvvuri Subbarao in Mumbai.
The Reserve Bank is likely to maintain status-quo on the key interest rates for the third time in a row in its upcoming bi-monthly policy review despite the US Federal Reserve and the European Central Bank hiking benchmark rates, as domestic inflation is within the RBI's comfort zone, say experts. The borrowing cost which started rising in May last year has stabilised with RBI keeping the repo rate unchanged at 6.5 per cent since February when it was raised from 6.25 per cent. In the previous two bi-monthly policy reviews in April and June the benchmark rate was retained.
Reserve Bank Deputy Governor S S Mundra on Friday said that he expects banks to cut interest rates
The majority votes came at a time when Subbarao had been holding the repo rate in the last four monetary policy reviews.
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At the retreat, PSBs had suggested the government cut its stake in these entities to less than 51 per cent over a period of time and empower the boards of individual banks.
The Reserve Bank of India on Thursday asked banks to review their loan policy towards micro, small and medium enterprises (MSMEs), badly hit by the economic slowdown.
The Bank Economists' Conference -- the most important event in Indian banking -- gets underway in Bangalore on Friday.
Interview with the Governor of Reserve Bank of India.
When it comes to running between the wickets -- which is exactly what an FM and a governor do -- Jadeja always defers to Dhoni's larger judgement of the situation and the needs of the team, observes T C A Srinivasa-Raghavan.
