Informist, Friday, May 20, 2022

NEW DELHI – The Reserve Bank of India's central board of directors had approved the transfer of 303.07 bln rupees as surplus to the central government for the financial year 2021-22 (Apr-Mar).

The amount is less than a third of the central bank's surplus transfer of 991.22 bln rupees for the truncated nine-month-long accounting year ended March 2021, after which the RBI changed its accounting pattern to match the financial year.

The Budget in February had pegged the dividend and surplus transfer from public sector banks and the central bank at 739.48 bln rupees for the financial year 2022-23, sharply lower than the 1.01 trln rupees it had projected for the previous financial year.

Central bank observers had expected the RBI's surplus transfer to make up around 500-600 bln rupees of the total budgeted transfer.

Gilt market participants were concerned that the lower surplus transfer may lead the Centre to undershoot the budgeted estimate for its capital receipts, and put greater pressure on its accounts.

The RBI may have set aside some cash surplus on its accounts as capital to meet the norms suggested by the Bimal Jalan-led panel in August 2019.

The board decided to maintain the central bank's contingency risk buffer at 5.50% of its balance sheet amid the transfer, the minimum level of the acceptable realised equity of the RBI as per the Jalan panel.

End

Reported by Aaryan Khanna

Edited by Tanima Banerjee

Cogencis news is now Informist. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

Informist Media Tel +91 (11) 4220-1000

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2022. All rights reserved.