BANKING GENERAL KNOWLEDGE
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
Reduction of CRR and SLR
|
|
|
Phasing out directed Credit Programme
|
|
|
Reduction of capital adequacy ratio
|
|
|
Establishment of ARF fund
|
Detailed explanation-1: -Accordingly, they suggested reducing SLR rates from 38.5% to 25% and CRR from 15% to 3-5%. The Government of India implemented credit programmes that compelled banks to set aside funds for the needy and poor sectors at decreased rates.
Detailed explanation-2: -The Narasimham committee (1991) proposed a significant reduction in the number of public sector banks through mergers and acquisitions to increase efficiency in banking operations. Three or four large banks, including SBI, should take on an international flavor.
Detailed explanation-3: -The Nariman Committee in 1969 recommended a scheme to unite the commercials banks co-operative banks and government and semi-government agencies to work together for the socio-economic growth of the country. The Lead Bank Scheme was also introduced.
Detailed explanation-4: -Stronger banking system: The Committee recommended the merger of major public sector banks to boost international trade. However, the Committee warned against merging stronger banks with weaker banks. Narrow Banking: Some of the public sector banks at that time had the problem of high non-performing assets (NPAs).