Reserve bank of india

Reserve Bank Of India is the Apex Bank of India responsible to take care of banking and credit system of the country.Its main function is to form the monetary policies and rules and regulations for efficient and transparent banking system..

1. Presented by:- Priyanshi Joshi mfa

2. Reserve Bank Of India India’s Central Bank

3. C ontents Introduction What does Bank mean? About Reserve Bank of India Establishment Preamble Objectives Functions Organizational Structure Tools of M onetary Control

4. Introduction In this rapidly changing world the scenario of banking is also changing. In earlier days there was deep influence of the unorganized financial system, but now the things are different. We now have in our country ,the organized financial system which comprises of financial institutions, financial market, financial instruments and financial services. These components of financial system are governed by some regulatory bodies which are: The Ministry of Finance Securities and Exchange Board of India Reserve Bank of India

5. What does Bank mean? The most important component of Financial System is Financial Institutions. Banks are the part of the Financial Institutions. The word ‘Bank’ means “an organization where people and businesses can invest and borrow money, change it to foreign currency, etc.” In India “Banking” has been defined by the statue viz the ‘Banking Regulation Act 1949 (vide section 5b,c)as follows: “Accepting for the purpose of lending or investment of deposits of money from the public, repayable on demand or otherwise and withdrawal by cheque, draft, and order or otherwise”

6. About RBI Head quarters : Shahid Bhagat Singh Marg Mumbai, Maharashtra Established : April 1,1935 Governor : Raghuram Rajan Currency : Indian Rupee ISO 4217 Code : INR Reserves : US$ 351.92 billion Bank Rate : 7.75% Interest on reserves : 4% Website : http://www.rbi.org.in/ RBI seal :

7. The Reserve Bank of India commonly known as the Central Bank of India is one of the Regulatory Bodies that governs the Financial System especially the Financial Institutions (Banking Institutions and Non-Banking Financial Institutions). Non-Banking Financial Institutions includes LIC of India,HDFC,MPFC etc Banking sector comprises of as shown in the figure:

8. Banking Institutions Scheduled and Non Scheduled Bank Public Sector Banks Co-operative Banks Private Sector and Foreign Banks 1.Cooperative Bank 2.Commercial Banks 3.Foreign Scheduled Banks 4.Indian Scheduled Banks 1.State Bank Group and Nationalised Banks 2.Regional R ural Banks 1.Rural C ooperativ -e Banks 2.Urban C ooperativ -e Banks

9. Establishment The Reserve Bank Of India which controls the monetary policies of the Indian Rupee was established on April 1,1935 during the British Raj in accordance with the provisions of the “Reserve Bank Of India Act 1934. The share capital was divided into shares of 100 each fully paid,which was entirely owned by the private shareholders in the beginning. Following India’s Independence in 1947, the RBI was nationalised in the year 1949. The central office of the RBI was initially established in calcutta but was permanently shifted to Mumbai in 1937.

10. Preamble The Preamble of the Reserve Bank of India describes the basic functions of the Reserve Bank as: "...to regulate the issue of Bank Notes and keeping of reserves with a view to securing monetary stability in India and generally to operate the currency and credit system of the country to its advantage." 

11. Objectives To manage the monetary and credit system in the country. To establish internal and external value of the currency(Rs.). For balanced and systematic development of banking in the country. For the development of organized money in the country. For proper arrangement of industrial and agricultural finance and the mgmt of public debt. For centralization of cash reserves of commercial banks. To establish monetary relations with other countries and international financial institutions. To maintain balance between demand and supply of currency.

12. Functions Monetary Authority Regulator and supervisor of the financial system Manager of Foreign Exchange Issuer of currency Development of Financial System Banker to Banks

13. Organisational Structure of RBI

14. Central Board The RBI’s affairs are governed by the central board of directors. The Board is appointed by the Govt. of India in keeping with the RBI Act. Function : general superintendence and direction of bank affairs. 1.appointed /nominated for the period of 4 years. 2.constitutes of 20 members in the following way: Official Directors : a)Governor b)4 Deputy governors Non Official Directors: a)nominated by Govt-10 directors from various fields and 2 Govt officials. b)others: 4 Directors :one each from four local boards

15. Local Board One each for the four regions of the country in Mumbai, Calcutta, Chennai and New Delhi Membership: consist of five members each and appointed by the Central Government for a term of four years Functions : To advise the Central Board on local matters and to represent territorial and economic interests of local cooperative and indigenous banks; to perform such other functions as delegated by Central Board from time to time.

16. Offices and Branches The RBI has four zonal offices in:Mumbai (west),Delhi(north),Kolkata(east) and Chennai(south) It has 19 regional offices at most state capitals and at a few major cities in India.Few of them are Ahemdabad,Banglore,Bhopal,Bhubaneshwar,Chandigarh,Chennai,Guwahati,Hydrabad,Jaipur,Jammu,Kanpur,Kolkata,Lucknow,Mumbai,Nagpur Patna,Thiruvananthapuram . Nine sub-offices at Agartala,Dehradun,Gangtok,Kochi,Panaji,Raipur,Ranchi,Shillong,Shimla and Shrinagar . The SBI represents RBI and work as its agent in places where there are no offices of the RBI and its associate banks are the agents of the RBI.

17. Tools for Monetary Control Reverse repo rate Cash reserve ratio Statutory liquidity ratio Bank rate Repo rate Selective credit control Marginal standing facility rate Open market operations

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