Government allocates Rs 6200 crore to RRBs under recapitalization scheme

As a part of the recapitalization scheme, the government has approved to allocation of Rs 6212.03 crore for RRBs.

Government allocates Rs 6200 crore to RRBs under recapitalization scheme

The central government has allocated Rs 6212.03 crore to Regional Rural Banks as part of the recapitalization scheme which aims to support RRBs in maintaining the minimum prescribed capital-to-risk (Weighted) assets ratio of 9 percent.

The performance of RRBs has improved significantly, with a consolidated CRAR (Capital to Risk-weighted Assets Ratio) at an all-time high of 13.83 percent as of December 31, 2023. In FY 22-23, RRBs recorded the highest-ever consolidated net profit of Rs 4,974 crores and a net profit of Rs 5,236 crore up to the third quarter of FY 2023-24.

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Similarly, credit expansion has increased the consolidated credit-deposit ratio to 72.13 percent as of Sept 2023, the highest in the past 15 years.

Regional Rural Banks (RRBs) are commercial banks owned by the Indian government operating at the regional level across various states. These were established in 1975 to provide basic banking and financial services to rural areas, particularly to small and marginal farmers, agricultural laborers, artisans, and small entrepreneurs.

 

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