SLR (Statutory Liquidity Ratio - mandated investments in government
securities)
The quantum is specified as some percentage of the total demand and
time liabilities ( i.e. the liabilities of the bank which are payable on demand
anytime, and those liabilities which are accruing in one months time due to
maturity) of a bank.
SLR rate = (liquid assets / (demand + time liabilities)) × 100%
This percentage is fixed by the central bank. The maximum and minimum
limits for the SLR are 40% and 25% respectively in India.
Following the amendment of the
Banking regulation Act (1949) in January 2007, the floor rate of 25% for SLR
was removed. Presently, the SLR is 22.5%.
From Wikipedia
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