What changed
This is a master circular consolidating all prior instructions on statutory reserves for UCBs up to June 30, 2010, replacing the July 2009 version. Key update: from April 1, 2007, RBI can prescribe CRR for scheduled UCBs without any floor or ceiling, following the RBI Act amendment. No new policy changes were introduced; it's purely a compilation.
What it means for you
UCBs must ensure strict daily compliance with CRR and SLR requirements using the prescribed register format. Scheduled UCBs face variable CRR as RBI decides, while non-scheduled UCBs have fixed statutory minima. The circular reinforces RBI's monitoring framework, making CEOs personally accountable for daily liquidity positions.
What you must do
- Maintain daily register of cash reserve and liquid assets as per Annex 8 format.
- Assign a responsible official for daily register upkeep and report to CEO daily.
- Ensure scheduled UCBs compute CRR as per Section 42 of RBI Act, 1934 without floor/ceiling.
- Non-scheduled UCBs must comply with Section 18 of BR Act, 1949 (AACS) for CRR.
- All UCBs must adhere to SLR requirements under Section 24 of BR Act, 1949 (AACS).
Who it affects
All Primary (Urban) Co-operative Banks (scheduled and non-scheduled), Chief Executive Officers of UCBs, Compliance and treasury teams of UCBs
What is the key change in CRR rules for scheduled UCBs?
From April 1, 2007, RBI can prescribe CRR for scheduled UCBs without any floor or ceiling, as per the amended Section 42(1) of RBI Act, 1934. Previously, the minimum was 3% and maximum 15%.
Who is responsible for daily CRR/SLR compliance?
The CEO is ultimately responsible for ensuring compliance at close of business each day. A designated official must maintain the daily register and present it to the CEO.
Does this circular introduce new reserve requirements?
No, it consolidates all existing instructions up to June 30, 2010. No new rates or requirements were added.