Regulation (Amendment) Bill, 2007, will offer RBI flexibility on SLR front
The Lok Sabha today passed the Banking Regulation (Amendment) Bill, 2007, which aims at allowing more operational flexibility to the Reserve Bank of India (RBI) in the conduct of monetary policy.
The bill seeks to amend Section 24 of the Banking Regulation Act, 1949 to enable the RBI to specify the statutory liquidity ratio without any floor rate. At present, banks are required to invest a minimum of 25% of their deposits in government securities, as dictated by the statutory liquidity ratio (SLR).
