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Established on April 1, 1935 with
share capital of Five Crores on
recommendation of Hilton Young
Commission
RBI was Nationalized in Year
1949.
Central Office was initially
established in Calcutta and moved
to Mumbai in 1937
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RBI Have 20 Directors :
The Governor
Four Deputy Governor
One Govt. Official from Ministry of Finance.
Ten Nominate Director, nominated by
Four Directors to represent Headquarters at
Mumbai, Kolkata, Chennai & New Delhi.
Appointed/ Nominated for period of Four Years.
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GovernorDr. D Subbarao
Deputy Governors
Dr. Rakesh Mohan, Smt. S. Gopinath,
Smt. Usha Thorat
Executive Directors
Sh. V.K. Sharma, Sh. C. Krishnan, Sh. Anand
Sinha, Sh. V.S. Das, Sh. G. Gopalkrishna, Sh.
H.R. Khan, Sh. D.K. Mohanty
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Head office in Mumbai.24 Regional offices, most of them in State
Capital.
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InitiallyCentral office initially in Calcutta shifted to
Bombay in 1937.
Main function were note issuance & being a banker
to govt.
No formal monetary policy formulation.This lead to number of failures which resulted in the
nationalization of reserve bank with the banking
regulation Act
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Responsibility of RBI get new dimension
due to following changes
Launch of Five year plans 1951
Institutional development assumed importance
in1960- 1970
Liberalization 1990
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Function of Reserve Bank
Issue of bank notes
Banker to government
Bankers Bank
Custodian of Foreign Exchange Reserves
Controller of Credit
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Role of RBI
Regulation and supervision of currency
Financial market developments
Monetary Fiscal Interface
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REGULATION AND
SUPERVISION OF CURRENCY
Has been in focus after the
nationalization of
commercial bank in 1969 Includes-
a)soundness of banking
operationb)Introduction of deposit
insurance scheme
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FINANCIAL MARKET
DEVELOPMENT
Need of financial development
1) administered interest rates
2) weak banking structure
3) lack of proper accounting
Development of Financial market
Complex process depends on
various factors
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1)Sound financial institution
2)A Favorable legal framework
3)Technological support
4)Congenial policy environment
Importance of Financial Market1)Improve management of liquidity and treasury
operations
2) Improves monetary transmission mechanism3) Fund based income and profitability
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MONETARY FISCAL INTERFACE
MONETARY POLICY- Economic policy of
govt. relating to currency and credit money.
FISCAL POLICY- Economic policy of govt.relating to taxation , expenditure, borrowing
and management of public debt in an economy
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RBI helps the govt .in controlling
fiscal deficit
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COMMUNICATION POLICY
RBI has transformed functionally and
structurally to the changing needs and
external needs through appropriate policyresponses.
UNTIL1991- Focus on healthy interaction
with the press to highlight the transparentmanner in which the RBI conducted with
central banking.
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AFTER 1991Well designed communication
policy with features like-
Transparency
Timeliness
Credibility
RBI uses website for dissemination of
information.
Solicits feedback on important issues placed
on its website
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CONCLUSION
The RBI presently in its seventieth year, has
had a fair degree of success in achieving the
twin objective of growth with stability. Controls all the monetary and fiscal policies
inside the country .
Provides legal framework to the local andmultinational banks.
Regulates issue of banks
Operates the currency and credit system