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News related to RBI

  1. RBI extends date of exchanging pre-2005 notes to Jan 1, 2015

Note: The Reserve Bank has further clarified that the public can continue to freely use these notes for any transaction. RBI has said that people can unhesitatingly receive these notes in payment, as all such notes continue to remain legal tender. 

  1. Reserve Bank of India (RBI) on 13 March 2014 hiked the trade related remittance limit from 2 lakh rupees to 5 lakh rupees per transaction with immediate effect. It also increased the number of transaction handled by exchange houses.
  2. KC Chakrabarty, Deputy Governor, Reserve Bank of India, has quit three months ahead of completion of his term.
  3. RBI pegged 2014-15 GDP growth at a central estimate of 5.5 percent.
  4. Economic growth for 2014-15 expected at 5.5 pc. 
  5. CAD expected to come down to 2 pc of GDP in 2014-15. 
  6. Retail inflation expected to be under 6 pc in 2014. 
  7. It halved the overnight call money rate to 0.25 percent and increased the 7-day and 14-day repo limits to 0.75 percent from 0.50 percent. 
  8. The Reserve Bank of India has constituted a GIRO Advisory Group (GAG) to implement a national Indian Bill Payment System so that households will be able to use bank accounts to pay school fees, utilities, medical bills and make remittances electronically. Panel is headed by Prof. Umesh Bellur
  9. RBI permitted Wholly Owned Subsidiaries (WOS) of the foreign banks to acquire domestic private sector banks and also permitted the banks to set up branches anywhere in the country. 

Note: foreign banks will not be allowed to hold more than 74 percent in the private banks they may acquire. 

  1. Currently, foreign banks as a group are entitled to open 12 branches in India every year.
  2. The initial minimum capital for a WoS will be Rs 500 crore,
  3. RBI said that the WoS will be required to meet Basel-III requirements (9 per cent Tier-I capital) right from Day One.
  4. For the first three years, the WoS will have to maintain Tier-I capital at 10 per cent.
  1. They will be allowed to open branches in Tier 1- centers without taking prior permission from the RBI provided at least 25 per cent of their branches are opened in un-banked rural centres (Tier 5 and Tier 6).
  1. The RBI also mandated that at least a third of the directors should be independent of the management of the subsidiary in India, its parent or associates. It also wants at least a third of the directors to be Indian nationals resident in India.
11. RBI Launches New RTGS System: The Reserve Bank of India on 19th Oct. launched the new Real Time Gross Settlement (RTGS) system for large-value funds transfer.


1, The Real Time Gross Settlement (RTGS) system is a large-value funds transfer system which banks use to settle inter-bank transfers for their own accounts as well as for their customers.
2. The new ISO 20022 compliant RTGS system provides three access options to participants — thick-client, Web-API (through INFINET or any other approved network) and Payment Originator module.
  1. RBI pegs CAD USD 56 billion in 2013-14 much lower than the quantum projected earlier. The current account deficit (CAD), which is the difference between outflow and inflow of foreign exchange, touched an all-time high of USD 88.2 billion or 4.8 percent of the GDP in 2012-13. 
  2. According to The Raghuram Rajan committee report suggested a new methodology for devolving funds on states based on a 'Multi Dimensional Index (MDI)'. 
  • Based on the MDI scores, the 10 least developed states are: Odisha, Bihar, Madhya Pradesh, Chhattisgarh, Jharkhand, Arunachal Pradesh, Assam, Meghalaya, Uttar Pradesh and Rajasthan. 
  • The 7 most developed status are Goa, Kerala, Tamil Nadu, Punjab, Maharashtra, Uttrakhand and Haryana. 
  • 11 less developed states are : Manipur, West Bengal, Nagaland, Andhra Pradesh, Jammu and Kashmir, Mizoram, Gujarat, Tripura, Karnataka, Sikkim and Himachal Pradesh. 
  1. RBI set up a 3 member committee under former Governor Bimal Jalan to scrutinise applications for new bank licences. The committee comprises of: Usha Thorat (former RBI Deputy Governor), C B Bhave (former Sebi chairman) and Nachiket Mor (financial sector expert).
  2. RBI has relaxed trade credit norms for all type of companies to avail of trade credit not exceeding $20 million up to a maximum period of 5 years for import of capital goods.
  3. According to RBI prudential norms:
    1. Banks are allowed to lend a maximum of 50% of their capital fund on any day during a fortnight.
    2. Borrowings by Scheduled Commercial Banks should not exceed 100 per cent of their capital fund.
    3. Banks are allowed to borrow a maximum of 125 per cent of their capital fund on any day, during a fortnight.
    4. Banks are allowed to lend a maximum of 25% of their capital fund on a fortnightly basis.
    5. Lending of Scheduled Commercial Banks, on a fortnightly average basis, should not exceed 25 per cent of their capital fund.
  4. RBI has decided to introduce a Forex Swap Window to meet the entire daily dollar requirements of of three public sector oil marketing companies IOC, HPCL and BPCL
  5. According to the new guide line of RBI, now banks can open their branches in tier I cities (the city which have population more than one lakh) without taking its permission in each case.
  6. RBI Rajbhasa Awards: Punjab National Bank (PNB) won five Rajbhasa Awards organized by RBI.
  7. RBI guide lines for the clearance of all the cheques is 2 days.
  8. RBI hiked the investment limit in government securities by FIIs and long-term investors $25 billion from $20 billion and in corporate bonds $50 billion from $45 billion.
  9. RBI permitted the premature encashment of 8% savings (Taxable) Bonds for individual investors who are 60 years and above in age.
  10. The RBI said, min paid-up equity of 25 % should be held directly by the lender. Also, repayment of the principal will commence only after completion of minimum average maturity of 7 years and no prepayment will be allowed before maturity.
  11. The Reserve Bank opened a special borrowing window of Rs 25,000 crore to help the crisis-ridden mutual funds tide over liquidity problems.
  12. Aditya Birla Group chairman Kumar Mangalam Birla has resigned from RBI board to avoid any conflict of interest as one of his group firm is in the race for a new banking licence.

News Related to Banking & Finance


  1. The Bank of Bahrain and Kuwait, BBK, plans to expand its operations in India by opening its fourth branch in the country in New Delhi.
  2. The Finance Minister has allowed retirement fund body Employees' Provident Fund Organisation (EPFO) to become a member of a stock exchange although its trustees oppose parking even a part of its over Rs five lakh crore corpus in equities.
  3. Canara Bank names cricketer Shikhar Dhawan as its brand ambassador.
  4. Corporation Bank has bagged the awards for lending to MSE (micro and small enterprises) and to micro enterprises from the Union Ministry of Micro, Small and Medium Enterprises (MSME) for 2012-13.
  5. Indian Bank has bagged national award for excellence in lending to micro enterprises for 2012-2013, for the consecutive second year.
  6. Interest rate on Post Office FDs increased: The rates apply to post office saving schemes and the return on 1-2 years deposits has been hiked by 20 basis points from 8.2 percent to 8.4 percent.
  7. The latest data released by the Central Statistics Office shows that Bihar is the fastest growing State with its Gross State Domestic Product growing at 15.05 per cent during 2012-13. According to the CSO data, Gujarat ranked 6th with growth rate at 7.96 per cent, behind Bihar and Madhya Pradesh with 9.89 per cent, Goa 8.47 per cent, Kerala 8.24 per cent and Odisha 8.09 per cent. The all-India growth rate in 2012-13 was 4.47 per cent.
  8. India has once again emerged as the largest non oil trading partner of Dubai in 2013-14.
  9. India has committed 8.5 billion rupees to Bhutan for Small Development Project for the country’s the 11th Five Year Plan.
  10. The World Bank provide up to $3 billion in aid for Ukraine in 2014 to help the country deliver much-needed economic reforms.
  11. India and United States Energy dialogue was held in New Delhi from 5 March 2014 to 11 March 2014.
  12. Russia suspended from G-8. France’s foreign minister says that leaders of the Group of Eight world powers have suspended Russia’s participation in the club amid tensions over Ukraine and Russia’s incursion into Crimea.
  13. Gujarat has been ranked number one in a list of India's 20 largest states in terms of “economic freedom”.The index on “economic freedom” takes into account governance, growth, citizens’ rights, and labour and business regulations. 
  14. Kotak Mahindra Bank launched its online social account integrated with Facebook and Twitter.
  15. Walmart Stores Inc has filed a lawsuit against Visa Inc, accusing the credit & debit card giant of conspiring with banks to fix fees that merchants pay for accepting payments through Visa cards.
  16. SEBI gets back power to act against ponzi schemes. The capital market regulator, the Securities and Exchange Board of India (SEBI), has got back the power to act against ponzi schemes, illegal deposit schemes and assess call data records in securities-related offences, besides others.
  17. ICICI Prudential Mutual Fund has bagged Morningstar India’s best fund house award in the debt, equity and multi-asset category.
  18. ADB (Asian Development Bank) pegs GDP growth rate for 2014-15 at 5.5 pc.
  19. Bank of India launched Instant Money Transfer Scheme. IMT scheme allows customers to withdraw cash without using either debt card or credit card at BoI's IMT-enabled ATMs. This is the first-of-its-kind initiative launched by a public sector bank.
  20. A new data on international arms transfers released that India’s import of weapon systems is three times more than Pakistan and China.
  21. Wholesale Inflation falls to 9-month low of 4.68 per cent in Feb
  22. Max Life Insurance ties up with Toyota Financial Services: Max Life Insurance has tied up with Toyota Financial Services India Ltd to provide insurance cover to car loan customers.
  23. Exim (Export and Import) Bank extends $90 mn line of credit to Republic of Congo.
  24. The headline inflation number, the wholesale price index or WPI, has increased to 7 per cent in October from 6.46 per cent in September.
  25. Deutsche Bank has become the first bank in India to use the Reserve Bank of India (RBI)’s window to swap fresh foreign currency non-resident (bank), or FCNR (B), dollar funds. It has raised about $450 million FCNR (B) deposits from about 10 non-resident Indians and swapped it with the central bank, 
  26. YES Bank has become the first bank to raise $ 225 million funds overseas using the swap loan facility provided by the Reserve Bank of India (RBI) . The private sector lender raised $255 million ($180 million and €58 million) by way of dual currency, multi-tenor syndicated loan facility.
  27. Canara Bank and Apollo Munich Health Insurance (AMHI) have entered into a bancassurance tie-up. This is the first such tie-up for the insurance company in its six years of existence. Bancassurance is distribution of insurance products through a bank’s network.
  28. In September 4, RBI had announced a swap window to attract FCNR (B) dollar funds. Accordingly, it has been decided to offer such a window to banks to swap fresh FCNR (B) dollar funds, mobilized for a tenure of at least three years, at a fixed rate of 3.5% a year for the tenure of the deposit,”.
  29. World Bank lowers 2013 growth forecast for East Asian developing countries to 7.1%
  30. WTO lowers growth projection for world trade in 2013 to 2.5% against 3.3 per cent projected in April and 4.3 per cent earlier in the year
  31. Own Your NPA’ campaign launched by IDBI: In a bid to speedily recover Non-Performing Assets (NPA), the IDBI Bank has launched a campaign named ‘Own Your NPA’.
  32. Tata Communications Payment Solutions Ltd (TCPSL), a wholly owned subsidiary of Tata Communications Ltd, today inaugurated Indicash ATMs in Mysore. Note: The company’s first white-label ATM was launched at Chandrapada village in Thane district on June 27.
  33. China launched its first direct bank, a new mode of providing online banking services without any entity outlets. The direct bank has been launched by the Bank of Beijing in co-operation with the Netherlands-based ING Group.
    Note: i. A direct bank is a bank without any branch network that offers its services remotely via online banking and telephone banking and may also provide access via ATMs (often through interbank network alliances), mail and mobile.
  34. Bhartiya Mahila Bank proposes to complete the first six branches at Mumbai, Delhi, Kolkata, Chennai, Indore & Guwahati.
  35. Headquarter at New Delhi and likely to operational by November this year.
  36. Indian banks would need Rs 3,90,000-5,00,000 crore capital over the next six years in the wake of Basel III capital regulations announced by the RBI.
  37. The Bank International Indonesia (BII) launched its operations in India by opening a branch in Mumbai.
  38. ICICI Bank, the country’s largest private sector bank, launched its ‘Branch on Wheels’ to offer basic banking services in remote areas which have so far been devoid of banking facilities.

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