Banking Regulation Bill
No Comments
Subject: Economy
Context:
Banking Regulation Bill introduced in Lok Sabha.
Concept:
- The Bill, which seeks to replace an ordinance issued by the Government in last week of June
- It likes to empower the Reserve Bank of India (RBI) to effectively handle the mishaps in private banks without allowing any loss of public confidence and disruption in the financial system
- The bill will allow the RBI to prepare a reconstruction scheme (for failed banks) without having to first make an order of moratorium on barring deposit withdrawals.
- This will enable the RBI to find suitors for a stressed bank.
- Besides, the Bill also brings certain cooperative banks — urban cooperative banks (UCBs) and multi-state cooperative banks (MSCBs) — under the RBI supervision process applicable to commercial banks as part of efforts to protect the depositors of such cooperative banks.