International finance.pptxdtbdfbdtbdtett

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1. DR.AMBEDKAR ARTS AND COMMERCE COLLEGE YERWADA, PUNE-06 M.COM (II) 2019 CREDIT PATTERN NAME OF THE SUB : INTERNATIONAL FINANCE NAME OF THE STUDENTS:- Mahesh Uttam Wabale ROLL NUMBER :- { } NAME OF THE TOPIC:- ROLE OF RBI IN CONTROLLING and SUPERVISION OF FOREIGN BANKING NAME OF THE GUIDE:- PROF .KHOPADE M.D.

2. ROLE OF RBI IN CONTROLLING and SUPERVISION OF FOREIGN BANKING Department of Banking Supervision The Banking Regulation Act, 1949 empowers the Reserve Bank of India to inspect and supervise commercial banks. These powers are exercised through on-site inspection and off site surveillance. Till 1993, regulatory as well as supervisory functions over commercial banks were performed by the Department of Banking Operations and Development (DBOD).

3. Basic objectives The basic purpose of banking supervision is to safeguard the stability of the financial system, in order to prevent the vital role of the banking sector in the economy from suffering significant shocks or even collapsing

4. How is RBI controlling the commercial banks? RBI controls the commercial banks viavarious instruments like Statutory Liquidity Ratio (SLR), Cash Reserve Ratio (CRR), Bank Rate, Prime Lending (PLR), Repo Rate, Reverse Repo Rate and fixing the interest rates and deciding the nature of lending to various sectors

5. These are those ratios and rates that are fixed by RBI and it is mandatory for all the commercial banks to follow or maintain these rates. All these measures control the commercials banks' operations and also control money supply in Indian economy.

6. Role of RBI The primary duty of the RBI is to implement monetary policy The Central Government’s Monetary Policy Committee (MPC), established under Section 45(B), determines the policy interest rate required to achieve the inflation target The RBI also conducts economic research to promote economic growth It is in charge of the nation’s currency’s design, production, and overall management, ensuring an adequate supply of clean and genuine notes Section 22 of the RBI Act empowers the bank to issue currency notes, except for one rupee note, which the Ministry of Finance issues The Government of India is the coin-issuing authority, and the Reserve Bank receives coins on demand

7. Supervision over FIS On the basis of the recommendations made by an in-house group, the monitoring of the financial institutions first started after 1990. This was done through prescribed quarterly returns on liabilities / assets, source and deployment of funds, etc. The objective of this monitoring was to obtain a macro level perspective for evolving monetary and credit policy, to assess the quality of assets of the financial system and to improve co-ordination between banks and FIs. In 1994, these institutions were brought under the prudential regulation of the Reserve Bank.

8. Supervision limits Management and administration of the institutions. Although directors and managers are responsible for the progress, successes and failures of the institution, the supervisor carries out the necessary analysis and verifications to obtain a reasonable awareness of their solvency and situation. External auditing of accounts. The external auditor is required to check and report whether the annual accounts give a true and fair view of the net worth, financial position and net profit of the company audited. It states its opinion in a report filed at the Mercantile Registry, to ensure that it has adequate publicity and to secure the relevant effects vis-à-vis third parties. 

9. Sincerely Thanks to :- Prof. PROF .KHOPADE M.D. MADAM