RBI/2016-17/159
DBR.No.Ret.BC.41/12.01.001/2016-17
November
26, 2016
The Chairperson / CEOs of all
Scheduled Commercial Banks/ Regional Rural Banks /
All Scheduled Primary (Urban) Co-operative Banks / All Scheduled State
Co-operative Banks
Dear Sir,
Reserve Bank of India Act, 1934
– Section 42(1A)
Requirement for maintaining additional CRR
Under section 42(1) of Reserve
Bank of India Act, 1934, all Scheduled Banks are required to maintain with
Reserve Bank of India a Cash Reserve Ratio (CRR) of 4% of Net Demand and
Time Liabilities (NDTL).
2. On a review of the current
liquidity conditions after the withdrawal of legal tender status of ? 500/-
and ? 1000/- denominations of bank notes issued by the Reserve Bank of
India till November 8, 2016 (referred to as Specified Bank Notes), it has
been decided to issue a directive under section 42(1A) of the Reserve Bank
of India Act, 1934 requiring all Scheduled Commercial Banks/ Regional Rural
Banks / all Scheduled Primary (Urban) Co-operative Banks / all Scheduled
State Co-operative Banks to maintain with the Reserve Bank of India,
effective from the fortnight beginning November 26, 2016 an incremental CRR
of 100 per cent on the increase in NDTL between September 16, 2016 and
November 11, 2016. As the incremental CRR is a temporary measure, it shall
be reviewed on December 9, 2016 or even earlier.
3. A copy of the relative
notification DBR.No.Ret.BC.40/12.01.001/2016-17 dated November 26, 2016 is enclosed.
Yours faithfully,
(S S Barik)
Chief General Manager-in-Charge
RBI/2016-17/
DBR.No.Ret.BC.40/12.01.001/2016-17
November
26, 2016
Notification
In exercise of the powers
conferred by sub-section (1A) of Section 42 of the Reserve Bank of India
Act, 1934, the Reserve Bank of India hereby directs that all Scheduled
Commercial Banks/ Regional Rural Banks / all Scheduled Primary (Urban)
Co-operative Banks / all Scheduled State Co-operative Banks, shall maintain
with the Reserve Bank of India, with effect from fortnight beginning
November 26, 2016.
(i) an additional average daily
balance over and above the average daily balance required to be maintained
under sub-section (1) of Section 42; and
(ii) that the amount of such
additional average daily balance shall not be less than 100 per cent of the
increase in net demand and time liabilities between September 16, 2016 and
November 11, 2016.
(Sudarshan Sen)
Executive Director
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