Rbi

PRESENTATION ON RESERVE BANK OF INDIA

SUBMITTED BY:Amit SharmaClass- PGDM- A

SUBMITTED TO:Mr. R.C Chatwal

INTRODUCTION…

It is central bank of indiaEstablished in 1 April 1935 under the RESERVE

BANK OF INDIA ACT Its headquarters is in mumbai(maharashtra) Its present governor is Duvvuri subbarao It has 22 regional offices,most of them in state

capitalswebsite: http://www.rbi.org

BRIEF HISTORY…

It was set on the recommendations of Hilton young commission.

It was started as share-holders bank with the paid up capital of 5 crores

Initially it was located in kolkata It moved to mumbai in 1937 Initially it was privately owned

BRIEF HISTORY…

Since nationalization in 1949,the reserve bank is fully owned by the government of india

Its first governor was Sir Osborne A.Smith (April 1, 1935 to june 30, 1937) The first indian governor was “Sir Chintaman D.Deshmukh” (August,1943 to june 30,1949) On june 27,2006 the union government of india

reconstituted the central board of directors of the Reserve bank of india(RBI) with 13 members including Azim Premji and Kumar Mangalam Birla

GOVERNORS…

Sir Osborne A.Smith

April 1 ,1935 to June 30 ,1937

Sir Chintaman D.DeshmukhAugust 11 ,1943 to June 30 ,1949

GOVERNORS…

Dr. Y.V. ReddySeptember 6 ,2003 to September 5 ,2008

Dr. D. SubbaraoSeptember 2008 onwards

PREAMBLE

The preamble of reserve bank of india describes the basic functions of reserve bank as:-

“…to regulate the issue of bank notes and keeping of reserves with a view to securing monetary stability in india and generally to operate the currency and credit system of country to its advantage”

ORGANISATION OF RBI

Central board Local board

ceNTRAL BOARD

The reserve bank’s affairs are governed by central board of directors.The board is appointed the govt. of india as per Reserve Bank of India Act

Appointed/nominated for a period of four years

Constitution:Full time:governor and not more than

four deputy governors

CENTRAL BOARD

Non-Official DirectorsNominated by government:ten directors from various fields and one government official

Others: four directors – one each from four local boards

Function: general superintendence and direction of bank’s affairs

RBI Headquarters’ Delhi entrance with the yakshini sculpture depicting ‘prosperity through agriculture’

Local board

One each for the four regions of country in Mumbai,Culcatta,Chennai,New Delhi

Membership: Consist of five members each Appointed by the Central Government For a term of four years

Local board

Functions: to advice the central board on local matters and to represent territorial and economic interests of local cooperatives and indigeneous banks.

To perform such other functions as delegated by central board from time to time

Functions of rbi…

Monetary Authority Regulator &supervisor of financial

system Manager of foreign exchange Issuer of currency Developmental role

Formulate monetary policy

Objective: Maintain price stability and ensuring adequate flow of credit in the economy.

What R.B.I does. It formulates ,implements and

monitors the monetary policy instruments: qualitative and

quantitative.

quantitative measures

BANK RATE also called discount rate.it also called repo rate.

OPEN MARKET OPERATIONS buying and selling of govt. securities

VARIABLE RESERVE RATIO It includes C.R.R and S.L.R

qualitative measures

Margin requirements

Moral suasion

Rationing of credit

regulate the financial system

objective: to maintain public confidence in the system, protect depositors interest & and provide cost effective banking services to the public

What R.B.I does prescribes broad parameters of banking operations within which the country’s banking and financial system functions.

The R.B.I performs this function under the guidance for financial supervision(BFS)

Lender of last resort

Issue of currency

Objective: to ensure adequate quantity of supplies of currency notes and coins of good quality

What R.B.I does….Issues new currency and destroy currency and notes not fit for circulation.

It has to keep in forms of gold and foreign securities as per statutory rules against notes and coins issued.

Development role

Objective: To develop the quality of banking system in india

What R.B.I does…. Perform a wide range of promotional

functions to support national objectives. To establish financial institution of

national importance, for eg:NABARD, IDBI etc

subsidiaries

Fully owned:National Housing Bank(NHB), Deposit Insurance and Credit Guarantee Corporation of India(DICGC), Bhartiya Reserve bank Note Mudran Private Limited(BRBNMPL)

Major stakes: National Bank For Agriculture and Rural Development(NABARD)

Reserve bank of india has recently disvested its stake in state bank of india to the government of india

R.B.I had also set up some training institutions

Related functions

Banker to government: performs all banking functions for the central and state govt. and also act as their banker

Banker to banks: Maintain banking accounts of all scheduled banks

R.B.I also regulates the opening/installation of ATM

Fresh currency notes forATMs are supplied by RBI RBI regulates the opening of branches by banks. It issues guidelines and directives for commercial

banks

Role of r.b.i in economic development

Development of banking system Development of financial institution Development of backward areas Economic stability Economic growth Proper interest rate structure

Banking sector reforms…

Statutory liquidity ratio(SLR) Cash reserve ratio(CSR) Interest rate slabs Prudential norms Capital Adequacy Norms Freedom of operation Supervision of commercial banks Recovery of debts.

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