INSUBCONTINENT EXCLUSIVE:
government as well as liberalizing norms for weak banks to boost lending in the economy, people with knowledge of the matter said.
The
Reserve Bank of India will also review rules on capital and risk weight for Indian banks which are considered more stringent than the Basel
Other proposals on the agenda include restructuring of loans upto 250 million rupees ($3.5 million) availed by micro, small and medium
enterprises.
The transfer of surplus reserves has been a flash point between the government and the central bank in the recent weeks and
Malik declined to comment while a spokesman of RBI was not immediately available for a comment.
The central bank may be open to easing tight
financial conditions prevailing in the banking sector, including by injecting cash through open market purchases of bonds, according to
people familiar with the matter
It is averse to parting with the reserves as some of these are notional, or relax capital adequacy norms for lenders, they added.
Apart from
also a thorny issue between the two
percent.
The RBI placed 11 state-run lenders under the so-called prompt corrective action framework, a move that effectively shut down their
lending, branch network expansion and dividend distribution.
