The Reserve Bank of India regulates the commercial banks in matters of
- Liquidity of assets
- Branch expansion
- Merger of banks
- Winding-up of banks
Select the correct answer using the codes given below:
[UPSC Civil Services Exam – 2013 Prelims]
(a) 1 and 4 only
(b) 2, 3 and 4 only
(c) 1, 2 and 3 only
(d) 1, 2, 3 and 4
Answer: (d)
Explanation:
- Reserve Bank of India is called the banker’s bank and regulates the banking sector in India.
- By using mechanisms like CRR, SLR, etc, it keeps a check on the liquidity of assets of the banks.
- Hence statement 1 is correct.
- Moreover, RBI also sets rules and regulations concerning the merger of banks, their winding-up operations, and branch expansion.
- Hence statements 2, 3, and 4 are correct.
