Mumbai: RBI on Wednesday constituted a six-member expert committee to review its extant Economic Capital Framework under the chairmanship of Dr Bimal Jalan, former Governor of India’s central bank.
The other members of the committee include former RBI Deputy Governor Rakesh Mohan, who will be vice chairman of the committee, Bharat Doshi, Sudhir Mankad, both directors, RBI’s central board, Subhash Chandra Garg, Economic Affairs Secretary, and NS Vishwanathan, RBI’s Deputy Governor.
The Expert Committee will submit its report within a period of 90 days from the date of its first meeting.
“As decided by the Central Board of Reserve Bank of India (RBI) in its meeting held on November 19, 2018, the RBI in consultation with the Government of India has today (Wednesday) constituted an expert committee to review the extant Economic Capital Framework of the RBI,” said a press release from the RBI.
RBI’s Central Board decided on November 19 to constitute a Board for Financial Supervision (BFS) of the Central bank to examine the framework for banks under the Prompt Corrective Action (PCA).
The Expert Committee would review status, need and justification of various provisions, reserves and buffers presently provided for by the RBI and would also review global best practices followed by the central banks in making assessment and provisions for risks which central bank balance sheets are subject to.
It will also suggest an adequate level of risk provisioning that the RBI needs to maintain and would determine whether the RBI is holding provisions, reserves, and buffers in a surplus/deficit of the required level of such provisions, reserves and buffers.