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Tips on new licences

Rangarajan

New Delhi, Jan. 6 (PTI): The RBI should give preference to the non-corporate sector while granting new bank licences, Prime Minister’s Economic Advisory Council chairman C. Rangarajan said.        

“It is possible for the Reserve Bank to start with initially non-corporate business and find out whether there are suitable applicants and thereafter proceed to look at the other applicants,” he said in an interview.        

The RBI is in the process of finalising the guidelines for granting new licences after Parliament approved the banking laws (amendment) bill last month. The central bank, Rangarajan said, “should look at various types of financial institutions that are available currently and decide”.        

“Many of the strong private sector banks today have been at one time or other in the financial system. They can look at it first and look at the other later on,” he said.        

He said the new banking legislation gave additional power to the RBI, particularly to remove the directors or change the board of directors.        

 
 
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