New Delhi: The Reserve Bank of India (RBI) today approved the transfer of fund to the tune of Rs. 1.76 lakh crore to the government in the form of dividend. The decision of the amount of funds to be transferred to the government was taken by the high level panel chaired by former RBI Governor Bimal Jain.
The RBI said in a statement, “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 today.”
The committee led by Bimal Jain examined the central bank’s financial resilience, cross-country practices, statutory provisions and the impact of the bank’s public policy mandate and operating environment before approving the surplus transfer of funds to the government.
The RBI statement added, “The committee has recommended the adoption of Expected Shortfall (ES) methodology under stressed conditions (in place of the extant Stressed-Value at Risk) for measuring the RBI’s market risk on which there was growing consensus among central banks as well as commercial banks over the recent years.”
The RBI decided to transfer the funds as the financial resilience was within the desired limit. The central bank also reviewed the current economic situation, global and domestic challenges and approved the Annual Report of the RBI for the fiscal year 2018-19.
