What changed
Previously, StCBs and RRBs could maintain as low as 70% of their required CRR on any day of the fortnight. Effective from the fortnight starting July 27, 2013, this daily minimum has been increased to 99%.
What it means for you
This sharply reduces intra-fortnight flexibility in managing liquidity. Banks must now keep almost their entire CRR obligation every day, leaving very little room for temporary shortfalls. It tightens short-term liquidity and may increase pressure on overnight funding.
What you must do
- Update your treasury systems to reflect the new 99% daily CRR maintenance threshold from July 27, 2013.
- Review your intra-fortnight cash flow projections to ensure daily CRR compliance without relying on previous 70% leeway.
- Communicate the change to your board and treasury teams immediately.
- Monitor RBI's press release 2013-2014/154 for context on exchange market measures.
Who it affects
All Scheduled State Cooperative Banks (StCBs), All Regional Rural Banks (RRBs), Treasury and ALM desks of these banks
What was the previous daily CRR maintenance requirement for StCBs/RRBs?
Earlier, banks could maintain a minimum of 70% of the required CRR on any day of the fortnight.
When does the new 99% requirement take effect?
It is effective from the first day of the fortnight beginning July 27, 2013.
Does this circular change any other CRR instructions?
No, all other instructions from earlier circulars remain unchanged.