The Reserve Bank of India (RBI) on Monday said that its central board had accepted the recommendations of Bimal Jalan Committee and approved surplus transfer to the government.
The RBI will transfer a sum of Rs 1,76,051 crore to the government comprising of Rs 1,23,414 crore of surplus for the year 2018-19 which comprises a surplus of Rs. 1,23,414 crore for 2018-19.
“The Central Board of the Reserve Bank of India (RBI) today decided to transfer a sum of Rs 1,76,051 crore to the Government of India (Government) comprising of Rs 1,23,414 crore of surplus for the year 2018-19 and Rs 52,637 crore of excess provisions identified as per the revised Economic Capital Framework (ECF) adopted at the meeting of the Central Board on Monday,” RBI said in a statement.
“It may be recalled that the RBI, in consultation with the Government had constituted an Expert Committee to Review the Extant Economic Capital Framework of the Reserve Bank of India (Chairman: Dr Bimal Jalan). The Committee has since submitted its report to the Governor of the RBI. The Committee’s recommendations were based on the consideration of the role of central banks’ financial resilience, cross-country practices, statutory provisions and the impact of the RBI’s public policy mandate and operating environment on its balance sheet and the risks involved,” it said.
“The Committee’s recommendations were guided by the fact that the RBI forms the primary bulwark for monetary, financial and external stability. Hence, the resilience of the RBI needs to be commensurate with its public policy objectives and must be maintained above the level of peer central banks as would be expected of a central bank of one of the fastest growing large economies of the world,” it added.
The Central Board accepted all the recommendations of the Committee and finalized the RBI’s accounts for 2018-19 using the revised framework to determine risk provisioning and surplus transfer.
The Board also reviewed the current economic situation, global and domestic challenges and various areas of operations of the Reserve Bank. The Board, further, approved the Annual Report of the Reserve Bank for the year 2018-19.