Reserve Bank of India

RBI/2019-2020/182
FMOD.MAOG.No. 140/01.01.001/2019-20

Dated: March 27, 2020

All Liquidity Adjustment Facility (LAF) participants

Madam/Sir,

Liquidity Adjustment Facility – Repo and Reverse Repo Rates

As announced in the Seventh Bi-monthly Monetary Policy Statement, 2019-20, today, it has been decided by the Monetary Policy Committee (MPC) to reduce the policy Repo rate under the Liquidity Adjustment Facility (LAF) by 75 basis points from 5.15 per cent to 4.40 per cent with immediate effect.

2. Further, consequent upon the widening of the LAF corridor, the Reverse Repo rate under the LAF stands adjusted from 4.90 per cent to 4.00 per cent with immediate effect.

3. All other terms and conditions of the extant LAF Scheme will remain unchanged.

Yours sincerely,

(Radha Shyam Ratho)
Chief General Manager

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Reserve Bank of India

RBI/2019-2020/183
FMOD.MAOG.No.139/01.18.001/2019-20

March 27, 2020

All Marginal Standing Facility (MSF) participants

Madam/Sir,

Marginal Standing Facility

As announced in the Seventh Bi-monthly Monetary Policy Statement, 2019-20 today, it has been decided by the Monetary Policy Committee (MPC) to reduce the policy Repo rate under the Liquidity Adjustment Facility (LAF) by 75 basis points from 5.15 per cent to 4.40 per cent with immediate effect.

2. Consequently, the Marginal Standing Facility (MSF) rate stands adjusted from 5.40 per cent to 4.65 percent with immediate effect.

Yours sincerely

(Radha Shyam Ratho)
Chief General Manager

——————-

Reserve Bank of India

RBI/2019-20/184
REF.No.MPD.BC.390/07.01.279/2019-20

March 27, 2020

All Primary Dealers,

Standing Liquidity Facility for
Primary Dealers

In the Seventh Bi-monthly Monetary Policy Statement 2019-20 of the Monetary Policy Committee (MPC) of March 27, 2020, the policy repo rate under the Liquidity Adjustment Facility (LAF) has been reduced by 75 basis points to 4.40 per cent from 5.15 per cent with immediate effect.

2. Accordingly, the Standing Liquidity Facility provided to Primary Dealers (PDs) (collateralised liquidity support) from the Reserve Bank would be available at the revised repo rate of 4.40 per cent with effect from March 27, 2020.

Yours faithfully,
(Deba Prasad Rath)
Adviser

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RESERVE BANK OF INDIA

www.rbi.org.in

RBI/2019-20/190
DOR.No.Ret.BC.53/12.01.001/2019-20

March 27, 2020

All Scheduled and Non Scheduled Banks

Dear Sir / Madam

Change in Bank Rate

Please refer to our circular DBR.No.Ret.BC.19/12.01.001/2019-20 dated October 04, 2019, on the captioned subject.

2. As announced in the Seventh Bi-Monthly Monetary Policy Statement 2019-20 of March 27, 2020, the Bank Rate is revised downwards by 75 basis points from 5.40 per cent to 4.65 per cent with immediate effect.

3. All penal interest rates on shortfall in reserve requirements, which are specifically linked to the Bank Rate, also stand revised as indicated in the Annex.

Yours faithfully,

(Dr. S.K.Kar)

Chief General Manager

Annex

Penal Interest Rates which are linked to the Bank Rate

Item Existing Rate Revised Rate (With immediate effect)
Penal interest rates on shortfalls in reserve requirements (depending on duration of shortfalls). Bank Rate plus 3.0 percentage points (8.40 per cent) or Bank Rate plus 5.0 percentage points (10.40 per cent). Bank Rate plus 3.0 percentage points (7.65 per cent) or Bank Rate plus 5.0 percentage points (9.65 per cent)

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Reserve Bank of India

RBI/2019-20/189
DOR.No.Ret.BC.52/12.01.001/2019-20

March 27, 2020

All Scheduled Banks (excluding Regional Rural Banks)

Dear Sir / Madam

Section 24 of the Banking Regulation Act, 1949 – Maintenance of Statutory Liquidity Ratio (SLR) – Marginal Standing Facility (MSF)

Please refer to our Circular DBOD.No.Ret.BC.95/12.02.001/2011-12 dated April 17, 2012, Circular UBD.BPD.(SCB).Cir.No.1/16.27.000/2014-15 dated October 29, 2014 and DCBR.BPD.(PCB/RCB).Cir.No.3/16.27.000/2018-19 dated August 16, 2018 on Marginal Standing Facility (MSF) Scheme.

2. As announced in the Statement of Developmental and Regulatory Policies, March 27, 2020, it has been decided to raise the borrowing limit of Scheduled Banks (excluding Regional Rural Bank) under the MSF scheme from 2 per cent to 3 per cent of their Net Demand and Time Liabilities (NDTL) outstanding at the end of the second preceding fortnight with immediate effect. The enhanced limit will be applicable up to June 30, 2020.

3. Please acknowledge receipt.

Yours faithfully

(Dr. S K Kar)
Chief General Manager

Reserve Bank of India

RBI/2019-20/192
DOR.No.Ret.BC.51/12.01.001/2019-20

March 27, 2020

All Scheduled Banks

Dear Sir / Madam

Section 42(1) of the Reserve Bank of India Act, 1934 – Change in Daily Minimum Cash Reserve Maintenance Requirement

Please refer to our Circular DBR.No.Ret.BC.91/12.01.001/2015-16 dated April 05, 2016 on the captioned subject.

2. As announced in the Seventh Bi-monthly Monetary Policy Statement, 2019-20, March 27, 2020, it has been decided to reduce the minimum daily maintenance of the Cash Reserve Ratio from 90 per cent of the requirement to 80 per cent effective from the fortnight beginning March 28, 2020. This is a one-time dispensation available up to June 26, 2020.

Yours faithfully

(Dr. S K Kar)
Chief General Manager

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