RBI Board to Give Rs 28,000 Crore as Interim Surplus to Modi Government
This is the second successive year that RBI will transfer the interim surplus to the government.
New Delhi, February 18: The Reserve Bank of India on Monday decided to give an interim surplus of Rs 28,000 crore to the Narendra Modi government for the half year ended December 31, 2018, taking the Centre's total surplus to Rs 68,000 crore. This is the second successive year that RBI will transfer the interim surplus to the government. The decision came hours after the customary post-Budget RBI board meeting chaired by Union Finance Minister Arun Jaitley.
"Based on a limited audit review and after applying the extant economic capital framework, the Board decided to transfer an interim surplus of Rs 280 billion to the central government for the half-year ended December 31, 2018," the central bank said in a statement. After the meeting of RBI board, Jaitley said the central bank decides independently on the quantum of interim dividend to be paid to the Centre. Arun Jaitley Bats For 'Lesser, Stronger' Banks as RBI Imposes Penalties on Lenders Flouting Loan Norms.
"The RBI takes an independent decision on the interim dividend," Jaitley said. The RBI's audit board had recently taken up the matter. The RBI, which follows the July-June fiscal year, has already transferred Rs 40,000 crore in the current fiscal as interim dividend. The Finance Ministry wanted a formal commitment on Rs 28,000 crore interim dividend. RBI Imposes Monetary Penalty on SBI, Bank of Baroda, Corporation Bank and Union Bank of India For Non-Compliance.
The central bank transfers its surplus amount to the government, under Section 47 of the RBI Act, 1934. Section 47 of the Act says: "After making provision for bad and doubtful debts, depreciation in assets, contribution to staff and superannuation fund and for all matters for which provision is to be made by or under the Act or which are usually provided by bankers, the balance of the profits shall be paid to the central government.”
As per the Budget document, the government expects Rs 82,911.56 crore as dividend/surplus of RBI, nationalised banks and financial institutions during 2019-20.
(The above story first appeared on LatestLY on Feb 18, 2019 07:23 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).