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RBI CREDIT AND MONETARY POLICIES (1999-2010) click here
RBI Announces Liquidity Easing Measures-Banks can borrow additional Rs 21,000 crore from the central bank.
May 26, 2010:
The Monetary Policy Statement for 2010-11 had indicated that the Reserve Bank intends to actively manage liquidity to ensure that the growth in demand for credit by both the private and public sectors is satisfied in a non-disruptive way. Accordingly, the Reserve Bank has been closely monitoring the developments in the global and domestic financial markets.
The latest assessment of liquidity conditions suggests that there could be temporary liquidity pressures in the market largely due to changes in government balances on account of advance tax payments and 3G auctions. In order to address the temporary liquidity pressures.
Successful Telecom companies in third-generation (3G) spectrum need to pay Rs 68,000 crore to the government by Monday and the banks are expected to be loan around Rs 45,000 crore to these companies. Besides, quarterly advance tax outflow is expected to be in the range of Rs35,000-45,000 crore.
RBI has announced following measures :
Scheduled commercial banks may avail of additional liquidity support under the LAF to the extent of up to 0.5 per cent of their net demand and time liabilities (NDTL). For any shortfall in maintenance of SLR arising out of availment of this facility, banks may seek waiver of penal interest purely as an ad hoc, temporary measure. This facility will be available till July 2, 2010.
The second LAF (SLAF) will be conducted on a daily basis up to July 2, 2010. The SLAF will be conducted between 4.00 p.m. and 4.30 p.m.
These measures are ad hoc in nature and the additional liquidity support under this scheme and the daily SLAF will be available with effect from May 28, 2010 and up to July 2, 2010.
The latest relaxations will allow banks to borrow additional Rs 21,000 crore from the central bank.
...Click Here For Macro economic and Monetary Developments : 2009-10
....Click Here For the Annual Policy Statement for the Year 2010-11
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