Preserving Financial Stability during COVID-19 by RBI

-

Preserving Financial Stability during COVID-19

10. The idea of financial stability in this broader sense moulded the Reserve Bank’s approach during the pandemic, which was a unique crisis, more challenging than the global financial crisis of 2008, impacting both the real and financial sector in great severity. With conventional, unconventional and new tools, the Reserve Bank responded through a series of measures to alleviate stress in various segments of the economy and the financial sector, including the stress encountered by market players and financial entities. Broadly speaking, our approach to the Covid situation included the following measures:

(a) Measures to mitigate the immediate impact of the pandemic : loan moratoriums together with asset classification standstill; easing of working capital financing and deferment of interest; restructuring of MSME loans, etc.

(b) Liquidity augmenting measures: LTRO/ TLTRO/refinance schemes for various sectors including stressed sectors; reduction in CRR, and other measures totalling about ₹12.81 lakh crore (6.3 per cent of nominal GDP of 2019-20).

(c) Countercyclical regulatory measures to ease stress on borrowers and the banking system –relaxation in regulatory compliance; conservation of capital by banks; relaxation in group exposure norms, etc.

(d) Measures to ensure uninterrupted flow of credit - significant interest rate cuts (115bps); assuring markets of easy financing conditions; exemption from CRR maintenance for incremental retail and MSME loans; extension of priority sector classification for bank loans to NBFCs for on-lending; rationalisation of risk weights for regulatory retail portfolio and individual housing loans, etc.

(e) Framework for resolution of Covid-related stress for individuals and businesses.

(f) Closer surveillance of supervised entities focusing on business process resilience and continuity, proactive management of risks, stress tests and proactive raising of capital, etc.

Comments

Post a Comment

Popular posts from this blog

Discuss the Salient features of cultural tradition of south India as reflected in Sangam leterature?15M

-
Introduction :  The Sangam Age in Indian history witnessed the rapid development of literary works in the southern regions. The literature that was created during this time came to be known as Sangam literature Mostly literary sources help us to understand t he society and culture of the Sangam age , which provides information regarding t he classification of the people, caste system , various occupations , practice of slavery , d ress and food hab it, status of women , religious practice s, education a nd other f ine ar t. Sources to understand Cultural Tradition of south India  The literatures are the primary sources for understanding the socio-cultural life of the people of Sangam age. The literatures of the Sangam age consists of the earliest Tamil literary works such as Tolkappiyam, the Ettutogai (Eight Anthologies), the Pattuppattu (Ten Idylls), the Pandinenkilkanakku (Eight Minor works) and the Five Epics Silappathikaram, Manimegalai, Sivaga Sindamani, Valaiyapathy and Kunda
Read more

Government notifies Information Technology (IntermediaryGuidelines and Digital Media Ethics Code) Rules 2021

-
  The Digital India programme has now become a movement which is empowering common Indians with the power of technology. The extensive spread of mobile phones, Internet etc. has also enabled many social media platforms to expand their footprints in India. Common people are also using these platforms in a very significant way. Some portals, whichpublish analysis about social media platforms and which have not been disputed, have reported the following numbers as user base of major social media platforms in India. Proliferation of social media,on one hand empowers the citizens then on the other hand gives rise to some serious concerns and consequences which have grown manifold in recent years. These concerns have been raised from time to time in various forums including in the Parliament and its committees, judicial orders and in civil society deliberations in different parts of country. Such concerns are also raised all over the world and it is becoming an international issue. T he Info
Read more