RBI clears Rs 2.1-lakh cr dividend to Govt
he Reserve Bank of India (RBI) has cleared a dividend of about Rs 2.11 lakh crore for the government for 2023-24, which is around 140 per cent more than Rs 87,416 crore that was transferred in the previous fiscal year
image for illustrative purpose
The Reserve Bank of India (RBI) has cleared a dividend of about Rs 2.11 lakh crore for the government for 2023-24, which is around 140 per cent more than Rs 87,416 crore that was transferred in the previous fiscal year.
The decision was taken at the 608th meeting of the RBI’s Central Board of Directors that was held today in Mumbai under the chairmanship of Governor Shaktikanta Das. “The Board reviewed the global and domestic economic scenario, including risks to the outlook. The Board also discussed the working of the Reserve Bank during the year April 2023-March 2024 and approved the Reserve Bank’s Annual Report and Financial Statements for the year 2023-24,” an RBI press release said.
The transferable surplus for 2023-24 has been arrived at on the basis of the Economic Capital Framework (ECF) adopted by the central bank on August 26, 2019.
From 2018-19 to 2021-22, owing to the prevailing macroeconomic conditions and the onslaught of Covid-19 pandemic, the Board had decided to maintain the Contingent Risk Buffer (CRB) at 5.5 per cent of the RBI’s balance sheet size to support growth and overall economic activity, the release said.
In order to combat monetary, financial, and external stability risks on a rainy day, the RBI makes provisions for a buffer in view of its role as the monetary authority and the lender of last resort. Realized equity is also required to cover credit risk and operational risk. This risk provisioning made primarily from retained earnings is cumulatively referred to as the CRB.
With the revival in economic growth in 2022-23, the CRB was increased to 6 per cent. As the economy remains robust and resilient, the Board has decided to increase the CRB to 6.5 per cent for 2023-24. The Board thereafter approved the transfer of Rs 210,874 crore as surplus to the government for 2023-24.
