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27 September 2018
 |
Statutory Liquidity Ratio (The Total Investment & Insurance
Solutions)
The
Reserve Bank of India will ease the Statutory Liquidity Ratio (SLR) norms from
October to induce liquidity into the financial system, amid concerns of a
credit crunch.
SLR
is a reserve requirement that commercial banks must maintain.
According
to the RBI, "the increase in 'Facility to Avail Liquidity for Liquidity
Coverage Ratio' (FALLCR), announced today (Thursday) for effect from October 1,
2018, from the existing 11 per cent to 13 per cent will take the carve out from
SLR available to banks to 15 per cent of their NDTLA(Net Demand and Time
Liabilities)".
The
development comes days after the apex bank had assured that it will take steps
to ensure adequate liquidity is available in the financial system.
"This
should supplement the ability of individual banks to avail of liquidity, if
required, from the repo markets against high-quality collateral," the RBI
said in a statement on Thursday.
"This,
in turn, will help improve the distribution of liquidity in the financial
system as a whole."
In
addition, the apex bank said that it will use various available instruments to
meet the durable liquidity requirements of the financial system.The Total Investment & Insurance Solutions
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