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Rbi says banks don’t need approval to inject capital into overseas branches and arms

Reserve Bank of India (RBI) Governor Shaktikanta Das announced on Friday that no approval would be required for banks to inject capital into their branches and arms overseas.

“At present, banks incorporated in India can inject capital into their branches and subsidiaries abroad; keep the profits in these centers; and repatriate / transfer the profits with the prior approval of the RBI. In order to provide operational flexibility to banks, it was decided that banks do not need to seek prior approval from the RBI if they meet regulatory capital requirements, ”Das said in its statement. .
The repo rate remains unchanged at 4%, the repo rate at 3.35%, the permanent marginal facility and the discount rate have been maintained at 4.25%.
RBI Governor Shaktikanta Das said the country was better prepared to deal with economic disruption from COVID. He said that in several sectors pre-pandemic production levels had been exceeded, but also said the economy was not yet strong enough for self-sustaining growth and therefore needed support. politics for a while. The RBI has kept its GDP growth forecast at 9.5% for the current fiscal year (2021-22).

The RBI has revised its quarterly projections for next year due to uncertainty caused by the Omicron variant of the COVID-19 virus and keeping an eye on the US Federal Reserve’s liquidity reduction expectations.

Das said headline inflation could peak in the fourth quarter of FY22. While in Q3 FY22, inflation is projected at 5.1%, it may peak at 5.7% in Q4 FY22. It will cool to 5% in the first and second quarters of fiscal 23, he said.

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(Edited by : Ajay Vaishnav)

First publication: STI


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