Reserve Bank board approves transfer of Rs 2.11 trillion surplus to govt
New Delhi, May 22, 2024
The expert committee had suggested maintaining the risk provisioning within a range of 5.5 per cent to 6.5 per cent of the RBI's balance sheet under the Contingent Risk Buffer
The Central Board of the Reserve Bank of India (RBI), on Wednesday, approved the transfer of Rs 2.1 trillion (Rs 2,10,874 crore) as surplus to the central government for the accounting year 2023-24, the central bank said in a press statement.
During its 608th meeting of the Central Board held in Mumbai under the chairmanship of Governor Shaktikanta Das, the RBI reviewed the global and domestic economic scenario, including risks to the outlook.
The RBI stated that the Board discussed the working of the RBI during the period between April 2023 and March 2024, and approved the Reserve Bank’s Annual Report and Financial Statements for the year 2023-24.
“The transferable surplus for the year (2023-24) arrived on the basis of the Economic Capital Framework (ECF) adopted by the Reserve Bank on August 26, 2019, as per recommendations of the expert committee to review the extant ECF of the RBI,” the RBI statement said.
The Committee had suggested maintaining the risk provisioning within a range of 5.5 to 6.5 per cent of the RBI’s balance sheet under the Contingent Risk Buffer (CRB).
The RBI further stated, “During accounting years 2018-19 to 2021-22, owing to the prevailing macroeconomic conditions and the onslaught of Covid-19 pandemic, the Board had decided to maintain the CRB at 5.5 per cent of the Reserve Bank’s balance sheet size to support growth and overall economic activity.”
Following the economic growth recovery in FY23, the CRB was raised to 6 per cent. Given the continued strength and resilience of the economy, the Board had opted to further raise the CRB to 6.5 per cent for FY24. Subsequently, the Board authorised the transfer of Rs 2,10,874 crore as surplus to the central government for the accounting year 2023-24.
Deputy Governors Michael Debabrata Patra, M Rajeshwar Rao, T Rabi Sankar, Swaminathan J, along with other Directors of the Central Board, including Satish K Marathe, Revathy Iyer, Anand Gopal Mahindra, Venu Srinivasan, Pankaj Ramanbhai Patel, and Ravindra H Dholakia, were present at the meeting.
Ajay Seth, Secretary of the Department of Economic Affairs, and Vivek Joshi, Secretary of the Department of Financial Services, were also in attendance.
[The Business Standard]
