UPSC Prelims 2013 · Question 92 of 99
UPSC Prelims 2013 question on RBI Regulation of Banks
- ExamUPSC CSE
- Year2013
- PaperGeneral Studies Paper I
- SubjectIndian Economy
- TopicMoney Market
- DifficultyMedium
- TypeDirect
The Reserve Bank of India regulates the commercial banks in matters of:
1. Liquidity of assets
2. Branch expansion
3. Merger of banks
4. Winding-up of banks
Select the correct answer using the codes given below:
Show answer
Answer: D. 1, 2, 3 and 4
Analysis
The Reserve Bank of India (RBI), as the central banking authority, regulates commercial banks in several areas including liquidity management through instruments such as CRR and SLR, approval of branch expansion, mergers and amalgamations of banks, and even winding-up or liquidation-related processes in coordination with the government and courts. Therefore, all four functions fall under the regulatory domain of the RBI.
Extra UPSC info
RBI derives many of its banking regulatory powers from the Banking Regulation Act, 1949.