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.
Detailed Explanation:
The Reserve Bank of India (RBI) regulates commercial banks comprehensively under the Banking Regulation Act, 1949. It controls liquidity of assets through CRR (Cash Reserve Ratio) and SLR (Statutory Liquidity Ratio), regulates branch expansion by granting licenses for new branches, oversees merger of banks to ensure financial stability and depositor protection, and initiates winding-up of banks in cases of severe financial distress. All four regulatory functions are core powers of the RBI.
Question 8 of 9 Reserve Bank of India
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