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Reserve Bank of India India’s Central Bank

Reserve Bank of India India’s Central Bank. Preamble. “… 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 the country to its advantage.".

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Reserve Bank of India India’s Central Bank

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  1. Reserve Bank of India India’s Central Bank

  2. Preamble • “… 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 the country to its advantage."

  3. Objectives • To regulate the issues of bank notes • To maintain reserves with a view to secure monetary stability • To operate the credit and currency system of the country

  4. Establishment • Established on April 1, 1935 with share capital of Five • Crores on recommendation of Hilton Young • Commission. • Govt. held shares of nominal value of 2,20, 000,rest were owned by private shareholders. • RBI was Nationalised in Year 1949. • Central Office was initially established in Calcutta and • moved to Mumbai in 1937

  5. STRUCTURE OF RBI RBI ORGANIZATION

  6. Structure • Central Board Consists of • The Governor (appointed /nominated by the govt.) • Four Deputy Governor • One Govt. Official from Ministry of Finance. • Ten Nominate Director, nominated by Govt. • Four Directors to represent Headquarters at Mumbai, • Kolkata, Chennai & New Delhi. • Appointed/ Nominated for period of Four Years.

  7. Central BOARD OF DIRECTORS • Responsible for the organization & management of RBI • Consist of 20 members constituted as Governor, Deputy -Governors and Directors 1.Central Board of Directors : The organization and management of RBI is vested on the Central Board of Directors. It is responsible for the management of RBI.Central Board of Directors consist of 20 members. It is constituted as follows. a)One Governor: it is the highest authority of RBI. He is appointed by the Government of India for a term of 5 years. He can be re-appointed for another term. b)Four Deputy Governors: Four deputy Governors are nominated by Central Govt. for a term of 5 yearsc)Fifteen Directors :Other fifteen members of the Central Board are appointed by the Central Government. Out of these , four directors,one each from the four local Boards are nominated by the Government separately by the Central Government. Governor • One in number • Highest authority of RBI • Acts as the chief executive officer and chairman of the central board of directors. • Appointed by Indian government • Full time officer of the bank

  8. Structure • Local Board • Four Local Boards one each for the four regions of the country • membership of local boards consists of 5 members each • Appointed by the central government for a period of 4 years.

  9. RBI Offices • Head office in Mumbai. • 24 Regional offices, most • of them in State Capital.

  10. Major Functions • Traditional Functions • Promotional Functions • Supervisory Functions

  11. Main Functions (Act, 1934) • Bank of Issue (Under Sec 22) • RBI has sole right to issue One Rupees Notes and • small coins in country as agent of Government. • RBI has separate Issue Department to issue currency • notes. • RBI maintain Minimum Reserve in form of Gold and • Foreign Exchange Reserve of which almost 55% • should be in Gold.

  12. Main Functions (Act, 1934) • Banker to Government • RBI is banker, agent and advisor of Central Government • and all State Government in India. • RBI helps the Government to float new loans and to • manage public debt. • RBI makes loans and advances to the States and local • authorities.

  13. Main Functions (Act, 1934) • Banker’s Bank & Lender of Last Resort • RBI maintains banking accounts of all schedule • banks. • Every schedule bank have to keep cash reserve a fix • percentage of their aggregate deposit liabilities . • Banks always expect for help from RBI in time of • banking crisis.

  14. Main Functions (Act, 1934) • Controller of Credit • RBI holds the cash reserves of all schedule banks. • It holds credit operations of banks through quantities • RBI has power to ask bank or whole banking system • not to lend particular group or person. • Every bank have to get license from RBI for banking • operation. RBI can also cancel this license. • Every bank gives weekly return showing assets and • liabilities in details .

  15. Main Functions (Act, 1934) • Custodian of Foreign Reserves • RBI responsible to maintain official rate of exchange • as according terms of I.M.F. • RBI reserves the international currency. • RBI observes relationship of Indian Currency with • other International currency.

  16. Main Functions (Act, 1934) • Promotional Functions • RBI ask banks and financing agencies to promote rural • and semi-urban areas by financing (funding ). • RBI setup directly or indirectly some institutions like : • Deposit Insurance Corporation ( 1962 ) • Industrial Development Bank ( 1964 ) • Unit Trust of India ( 1964 ) • Industrial Reconstruction Corp. of India ( 1972 ) • Agricultural Refinance Corporation ( 1963 ) • RBI promotes villagers for saving and route this money • as short term credit to agriculture.

  17. List of Executives • Governor • Dr. D Subbarao • Deputy Governors • Dr. Rakesh Mohan, Smt. S. Gopinath, Smt. Usha Thorat • Executive Directors • Sh. V.K. Sharma, Sh. C. Krishnan, Sh. Anand Sinha, • Sh. V.S. Das, Sh. G. Gopalkrishna, Sh. H.R. Khan, • Sh. D.K. Mohanty

  18. Address of RBI • Reserve Bank of India, • Central Office, • Shaheed Bhagat Singh Road, • Mumbai – 400 001 • Ph.No. 22660868, Web : www.rbi.org.in

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