RBI 90 Quiz: Test Your Knowledge on RBI's 90th Anniversary

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Questions and Answers

What type of data does the Order Books, Inventories and Capacity Utilisation Survey (OBICUS) primarily collect?

Inflation rates in the manufacturing sector

Monetary policy impacts on production

Quantitative data on orders and inventories (correct)

Qualitative assessments of market trends

What is the rate of interest on the Government of India Floating Rate Bond 2028 for the period from April 04, 2024 to October 03, 2024?

7.25% per annum

7.50% per annum

8.00% per annum

7.72% per annum (correct)

Which of the following components is NOT included in the OBICUS data collection?

Inflation rates over the quarter (correct)

Total inventories breakdown

New orders received during the quarter

Backlog of orders at the beginning of the quarter

What is the fixed spread associated with the Government of India Floating Rate Bond 2028’s interest rate?

0.64% Signup and view all the answers

How often has the RBI conducted the OBICUS since its inception in 2008?

Quarterly Signup and view all the answers

The benchmark rate for the Floating Rate Bond may vary based on which of the following?

The average of recent T-Bills Signup and view all the answers

Which of the following factors does NOT influence the changes in production during the survey period as per OBICUS?

Global market trends Signup and view all the answers

What is a characteristic feature of Floating Rate Bonds like the Government of India Floating Rate Bond 2028?

Variable coupon rate based on benchmarks Signup and view all the answers

What significant event is marked by 1st April 2024?

The 90th anniversary of the Reserve Bank of India Signup and view all the answers

Which feature distinguishes the commemorative coin released for RBI's 90th anniversary?

It is made with 99.99% pure silver and weighs around 40 grams. Signup and view all the answers

What is the current status of India's foreign exchange reserves as of the announcement?

They are the fourth greatest in the world. Signup and view all the answers

What initiative has contributed to resolving significant default loan amounts in India?

The Insolvency and Bankruptcy Code (IBC) Signup and view all the answers

According to recent announcements, what percentage of Jan Dhan accounts belong to women?

55% Signup and view all the answers

What does the Lion Capital of the Ashoka Pillar symbolize on the commemorative coin?

India's cultural heritage and democratic principles Signup and view all the answers

How much capital infusion was undertaken to assist public sector banks?

3.5 lakh crore Signup and view all the answers

Which of the following statements about Gross NPAs of banks is correct?

They dropped from 11.25% in 2018 to below 3% by September 2023. Signup and view all the answers

What is the minimum paid-up voting equity capital required for a universal bank under the RBI guidelines?

Rs 500 crore Signup and view all the answers

Which of the following companies was found unsuitable for granting approval to set up a small finance bank?

Tally Solutions Private Limited Signup and view all the answers

What percentage of total paid-up capital did the reported NGNF companies account for in March 2023?

34.2% Signup and view all the answers

What was the increase in net sales of NGNF private limited companies during 2022-23?

20.3% Signup and view all the answers

According to RBI guidelines, what is the initial net worth requirement for urban co-operative banks transitioning into small finance banks?

Rs 100 crore Signup and view all the answers

What was the increase in operating expenses for NGNF private limited companies in 2022-23?

20.4% Signup and view all the answers

What is the primary focus of the 2024-25 Monetary Policy Statement?

Withdrawal of accommodation to align inflation with targets Signup and view all the answers

How many applications did RBI receive for setting up banks under the guidelines?

13 applications Signup and view all the answers

What was the percentage growth in operating expenses in the previous year prior to 2022-23?

33.4% Signup and view all the answers

Which of the following rates remained unchanged in the policy statement?

All of the above rates Signup and view all the answers

What is the current value of the Standing Deposit Facility Rate as per the policy?

6.25% Signup and view all the answers

Which policy variable is associated with the value of 6.75%?

Marginal Standing Facility Rate Signup and view all the answers

What does the term 'withdrawal of accommodation' imply in the context of monetary policy?

Tightening monetary policy to control inflation Signup and view all the answers

What is the primary purpose of the Centralised Information Management System (CIMS) Portal?

To serve as a platform for regulatory and supervisory return submissions Signup and view all the answers

When will banks begin submitting the monthly Form VIII Return on the CIMS Portal?

May 2024 Signup and view all the answers

What is one of the features of the CIMS Portal mentioned?

It enables data mining and visual analytics. Signup and view all the answers

Which return is specifically related to details about paid-up capital and reserves?

Form A Signup and view all the answers

What significant change was made regarding the submission of regulatory returns?

Conversion from the existing XBRL system to CIMS. Signup and view all the answers

What aspect of the CIMS Portal is designed to reduce regulatory compliance burden?

It simplifies the submission process for regulated entities. Signup and view all the answers

Which of the following statements about the new RBI website is correct?

The new website can be accessed at 'https://website.rbi.org.in'. Signup and view all the answers

By when are banks required to use the CIMS Portal exclusively for Form IX submissions?

December 31, 2024 Signup and view all the answers

What is the projected real GDP growth for India in 2024-25?

7.0% Signup and view all the answers

Which measure is aimed at supporting CPI inflation while promoting growth?

Fixed Reverse Repo Rate Signup and view all the answers

What was the all-time high of India's foreign exchange reserves as of March 29, 2024?

US$ 645.6 billion Signup and view all the answers

What was the level of net foreign portfolio investment (FPI) inflows during 2023-24?

US$ 41.6 billion Signup and view all the answers

What was the CPI inflation rate during January-February 2024?

5.1% Signup and view all the answers

Which event occurred in January 2023 related to financial markets in India?

Launch of Sovereign Green Bonds Signup and view all the answers

What was the net foreign direct investment (FDI) in April-January 2023-24?

US$ 14.2 billion Signup and view all the answers

How is the Current Account Deficit projected to be within 2024-25?

Sustainable and manageable Signup and view all the answers

What is the main purpose of SGRBs?

To accelerate India's transition to a low-carbon economy. Signup and view all the answers

Which of the following characteristics does NOT apply to SGRBs?

They carry significant default risks. Signup and view all the answers

What does the RBI Retail Direct Scheme allow individual investors to do?

Maintain gilt accounts and invest in government securities. Signup and view all the answers

Which aspect of the LCR framework requires banks to maintain HQLA?

To cover expected net cash outflows in the next 30 days. Signup and view all the answers

What new facility is proposed for enabling the UPI cash deposit?

Through UPI transactions for cash deposits. Signup and view all the answers

Under the new regulations for Small Finance Banks, which of the following is now permitted?

Using multiple rupee interest rate derivative products. Signup and view all the answers

What is the intended benefit of allowing PPIs to link with third-party UPI applications?

To enhance convenience for PPI holders in making payments. Signup and view all the answers

What was introduced in the RBI Retail Direct Scheme for better access?

An advanced mobile application for easier navigation. Signup and view all the answers

What does the government aim to achieve by issuing SGRBs?

To transition towards a sustainable low-carbon economy. Signup and view all the answers

Which of the following statements about UPI usage for cash withdrawals is true?

UPI facilitates card-less cash withdrawals at ATMs. Signup and view all the answers

What is a required characteristic of a Self-Regulatory Organization (SRO)?

They should operate with transparency and credibility. Signup and view all the answers

What is not an objective of an SRO?

To discourage compliance among its members. Signup and view all the answers

What should SROs establish to address violations by members?

Clear standards of conduct and specified consequences. Signup and view all the answers

Which of the following is a responsibility of the SRO towards its members?

To frame and monitor a code of conduct. Signup and view all the answers

Which of these aspects is essential for SRO governance?

Independent board oversight and strong governance mechanisms. Signup and view all the answers

How should SROs handle disputes among members?

By implementing standardized procedures for resolution. Signup and view all the answers

What should SROs not focus on for improving their members' adherence?

Extending stringent punitive measures. Signup and view all the answers

What type of information should an SRO collect and share?

Relevant sectoral information to assist the Reserve Bank. Signup and view all the answers

Which of the following is true about the membership of SROs?

Membership agreements may impose ethical standards. Signup and view all the answers

What is required from regulated entities unable to liquidate their investments within the prescribed 30 days?

To make a 100% provision on such investments Signup and view all the answers

Under what condition will investments in subordinated units of an AIF not require a deduction from capital funds?

If the AIF does not have any downstream investment Signup and view all the answers

Which of the following best defines 'Evergreening' in the banking context?

Giving new loans to struggling borrowers Signup and view all the answers

What percentage of capital is proposed to be deducted from Tier-1 and Tier-2 equally?

100% Signup and view all the answers

What does the Omnibus Framework for recognising Self-Regulatory Organisations (SROs) not specify?

Risk assessment protocols Signup and view all the answers

What is the main objective of the RBI's decision regarding AIF investments?

To prevent indirect exposure to troubled borrowers Signup and view all the answers

Which type of AIF exposure is explicitly excluded from the RBI's capital deduction requirements?

Investments through mutual funds Signup and view all the answers

What is the primary focus of the RBI's Omnibus Framework for SRO recognition?

To establish common standards for self-regulation Signup and view all the answers

In the context of AIFs, what does 'downstream exposure' refer to?

Investments made by an AIF in borrower companies that owe money Signup and view all the answers

What is a regulated entity prohibited from doing with respect to AIF schemes?

Investing in AIF schemes with direct investments in debtor companies Signup and view all the answers

What qualifies a company as a debtor company under the regulations for AIF investments?

Any company to which the regulated entity has had a loan or investment exposure in the last 12 months Signup and view all the answers

What action must a regulated entity take if it is invested in an AIF that subsequently invests in its debtor company?

Liquidate its investment in that AIF scheme within 30 days Signup and view all the answers

Which of the following is excluded from the definition of downstream investments?

Equity shares of the debtor company Signup and view all the answers

Which entities are specifically mentioned as being applicable under the regulations for AIF investments?

Commercial Banks, Co-operative Banks, and Financial Institutions Signup and view all the answers

What is the primary regulatory concern that has led to the restrictions on AIF investments by regulated entities?

Possible evergreening of loans through AIFs Signup and view all the answers

What must an AIF do to remain compliant if it has upstream investments from a regulated entity?

Ensure no downstream investments are made in companies linked to the regulated entity Signup and view all the answers

What does the RBI's directive specifically require from regulated entities regarding AIFs they are already invested in?

Liquidate existing investments with downstream implications Signup and view all the answers

Study Notes

RBI Commemorates its 90th Year

The Reserve Bank of India (RBI) began operations on April 1, 1935, after being established under the RBI Act, 1934.
Initially headquartered in Kolkata, the RBI moved its Central Office to Mumbai in 1937.
"RBI@90" is a program celebrating 90 years of the RBI, with a commemorative Rs 90 coin released.
The commemorative coin is made of 99.99% pure silver, weighs around 40 grams, and features the Lion Capital of the Ashoka Pillar with "Satyamev Jayate" engraved below.
As of April 2024, RBI’s establishment marks a significant milestone in India's economic landscape.

Key Economic Highlights

India contributes 15% to global GDP growth, positioning itself as an engine of global economic activity.
Public sector banks received a capital infusion of ₹3.5 lakh crore.
The Insolvency and Bankruptcy Code (IBC) has resolved loans worth ₹3.25 lakh crore, facilitating the resolution of over 27,000 default applications.
Gross Non-Performing Assets (NPAs) of banks dropped from 11.25% in 2018 to below 3% by September 2023, with a 15% increase in credit reported.
Women hold 55% of the 52 crore Jan Dhan accounts in India, highlighting increased financial inclusion.
The Kisan Credit Card program has reached over 7 crore farmers, improving rural financial accessibility.
Unified Payments Interface (UPI) transactions surpassed 1200 crores monthly, establishing it as a global leader.
India's foreign exchange reserves stand at approximately $642 billion, ranking fourth globally behind China, Japan, and Switzerland.

Order Books, Inventories and Capacity Utilisation Survey (OBICUS)

RBI conducts the OBICUS quarterly for the manufacturing sector, collecting data since 2008.
The 65th round of this survey covers the period from January to March 2024.

Government of India Floating Rate Bond 2028

The interest rate for the Government of India Floating Rate Bond 2028 is set at 7.72% per annum for the period April 2024 to October 2024.
The floating rate is based on the average of the last three auctions of 182 Day T-Bills with a fixed spread of 0.64%.

Licensing of Small Finance Banks

RBI received 13 applications for bank licenses under the 'on tap' framework for Universal and Small Finance Banks.
Two proposed applicants, Dvara Kshetriya Gramin Financial Services and Tally Solutions, were not approved for setting up a small finance bank.

Financial Performance of Non-Government Non-Financial Companies (NGNF)

RBI's analysis of NGNF private limited companies for 2022-2023 reveals paid-up capital of ₹6.61 lakh crore, accounting for 34.2% of all NGNF paid-up capital.
Net sales increased by 20.3% in 2022-23, following a 30.5% growth in the previous year.
Operating expenses rose by 20.4% during the same period after a previous 33.4% increase.

Centralised Information Management System (CIMS) Portal

CIMS, launched in 2023, replaces the XBRL system for regulatory submissions by banks.
It establishes a centralized platform for regulatory and supervisory return submissions, enhancing data accessibility and compliance efficiency.

Monetary Policy Statement, April 2024

Key repo rate and standing deposit facility rates remain unchanged at 6.50% and 6.25% respectively.
CPI inflation target remains within a band of +/- 2%, aiming for a medium-term target of 4%.

Sovereign Green Bonds (SGRBs)

SGRBs fund projects advancing India's transition to a low-carbon economy and are open to foreign investment through IFSC.
The framework for SGRBs was issued in 2022 to encourage climate-friendly investments.

Retail Direct Scheme

Launched in November 2021, the RBI Retail Direct Scheme allows individual investors to maintain gilt accounts and invest in government securities.
A mobile application is being developed to enhance access to government securities.

Regulatory Oversight on Alternative Investment Funds (AIFs)

RBI prohibits regulated entities from investing in AIFs with downstream investments in their debtor companies.
Established guidelines aim to avoid indirect exposure to troubled borrowers and ensure transparency and accountability in lending practices.

Omnibus Framework for Self-Regulatory Organisations (SROs)

An Omnibus Framework has been introduced to recognise SROs for RBI-regulated entities to enhance industry standards and self-regulation practices.### SRO Framework Overview
Objectives, responsibilities, eligibility criteria, governance standards, application process, and membership criteria are common for any Self-Regulatory Organization (SRO) proposed for recognition by the Reserve Bank of India (RBI).
SROs play a crucial role in enhancing regulatory compliance and fostering sustainable sector development.

Characteristics of an SRO

Credibility, Objectivity, and Responsibility: SROs must operate credibly and objectively, enhancing regulatory compliance under regulator oversight.
Sufficient Authority: Strong governance mechanisms are essential, emphasizing independent boards, transparency, and defined processes through membership agreements.

Membership Details

Membership includes regulated entities (REs) that accept membership within the SRO framework.

Rule Making and Enforcement

SROs should establish objective, consultative processes for rule-making related to member conduct, ensuring enforcement of these rules.
Clear standards of conduct must be set, specifying consequences for rule violations, including counseling, reprimanding, and expulsion, without involving monetary penalties.

Compliance and Dispute Resolution

SROs need to develop standards that enhance the compliance culture among members concerning RBI's rules and regulations.
They should implement procedures for dispute resolution among members, emphasizing transparency and consistency in arbitration processes.
Effective sector monitoring through suitable surveillance methods is vital.

Objectives of the SRO

Promote Compliance Culture: Foster progressive practices and provide guidance for smaller entities while sharing best practices aligned with regulatory policies.
Collective Voice: Represent members' interests and address industry-wide concerns to improve the financial system.
Data Sharing: Collect and share relevant sectoral information with the RBI to support policymaking, encouraging innovation and product development within regulations.
Research and Development: Encourage innovation while maintaining high compliance standards and promoting self-governance within the sector.

Responsibilities Toward Members

Code of Conduct: Develop and enforce a code of conduct for members, monitoring adherence to regulatory instructions.
Membership Fee Structure: Create a uniform, reasonable, and non-discriminatory fee structure for membership.
Dissemination of Information: Provide sector-specific information through various publications to raise awareness among members about industry matters.

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Test your knowledge about the Reserve Bank of India's history and its significant milestones over the past 90 years. This quiz covers key facts about its establishment, leadership, and relocation. Discover how the RBI has shaped India's financial landscape since its inception.

RBI 90th Anniversary Quiz

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