Yours faithfully,

(S.Karuppasamy)
Chief General Manager-in-Charge

1.1 All primary (urban) co-operative banks (PCBs) (scheduled as well as non-scheduled) are required to maintain stipulated level of cash reserve ratio (CRR) and statutory liquidity ratio (SLR).

1.2 In regard to cash reserve, the scheduled PCBs are governed by the provisions of section 42(1) of the Reserve Bank of India Act, 1934, whereas, non scheduled PCBs are governed by the provisions of section 18 read with section 56 of the Banking Regulation Act, 1949.

1.3 For purpose of maintenance of SLR all the banks (scheduled as well as nonscheduled) are governed by the provisions of section 24 of the Act ibid.

1.4 Currently operative instructions on all these aspects are detailed in the following paragraphs.

2.1 SCHEDULED PCBs
2.1.1 Statutory Minimum CRR

In terms of section 42(1) of the Reserve Bank of India (RBI) Act, 1934, the scheduled PCBs are required to maintain with the RBI during the fortnight, a minimum average daily balance of 3% of their total demand and time liabilities (DTL) in India obtaining on Friday immediately preceding the fortnight.

2.1.2 Additional CRR
(i) In term of the proviso to sub-section (1) of section 42 of the RBI Act 1934, RBI is empowered to increase, through Gazette notification, the said rate up to 20% of the DTL.

(ii) Presently, scheduled PCBs are required to maintain with RBI an average daily balance, the amount of which shall not be less than 4.5% of its net demand and time liabilities (NDTL) in India, as shown in the return referred in sub-section (2) of section 42 of the Act, ibid.

2.1.3 Incremental CRR
(i) In terms of section 42(1) A of the RBI Act 1934, the Reserve Bank is also empowered to prescribe, through Gazette notification, maintenance of an additional average daily balance, at a rate and from a date specified in the notification, so that the additional balance is calculated with reference to the excess of DTL of the bank over the similar total on the specified date.

(ii) Currently no incremental CRR has been prescribed by RBI.

2.1.4 Multiple Prescriptions for CRR
(i) The Reserve Bank is empowered to specify from time to time with reference to any transaction or class of transactions which shall be treated as liability in India of a scheduled PCB.

(ii) With a view to facilitating the development of a more realistic rupee yield curve and term money market, the liabilities of scheduled PCBs to the Banking System as computed under clause (d) of explanation to section 42(1) of the RBI Act, 1934, are exempted from maintenance of CRR with effect from the fortnight beginning April 26, 1997.Effective from the fortnight beginning June 14 2003, the scheduled PCBs are required to maintain a CRR of 4.5% of the NDTL.

(iii) With a view to provide flexibility to banks and enable them to choose an optimum strategy of holding reserves depending upon their intra period cash flows, the scheduled PCBs are presently required to maintain on average daily balance, a minimum of 70% of the CRR balance required to be maintained by them, based on their NDTL, as on the last Friday of the second preceding fortnight.

2.1.5 Withdrawal of exemptions on liabilities
With effect from the fortnight beginning November 3, 2001, all the exemptions on liabilities viz. NRE, NRNR and FCNR (B) accounts stand withdrawn, except exemption granted for inter-bank liabilities for computation of NDTL (for requirement of maintenance of CRR) as indicated in para 2.1.4 (ii) above. However, the effective CRR maintained by the scheduled banks on the total DTL shall not be less than 3% as stipulated under the Act.

2.1.6 Treatment of Collateralised Borrowing and Lending Obligation
The Clearing Corporation of India Ltd. (CCIL) has introduced, a money market instrument, called Collateralised Borrowing and Lending Obligation (CBLO). Since CCIL is considered as a non-bank institution, borrowing bank should classify its borrowing under CBLO as "Liability in India to Others" which qualify for reserve requirements.

Accordingly, scheduled PCBs are required to include in their NDTL the borrowing under CBLO. However, in order to develop CBLO as a money market instrument, it has been decided to grant special exemption from CRR prescription, subject to the banks maintaining statutory minimum CRR of 3%.

2.1.7 Computation of Net Demand & Time Liabilities (NDTL) for CRR
(i) Liabilities of a bank may be in the form of demand or time deposits or borrowings or other miscellaneous items of liabilities. "Demand Liabilities" include all liabilities which are payable on demand. "Time Liabilities" are those which are payable otherwise than on demand.

(ii) The computation of DTL, liabilities to the banking system, assets with the banking system, NDTL etc. are explained in detail in annexure I.

2.1.8 Calculation of CRR
In order to improve the cash management by banks, as a measure of simplification, a lag of two weeks has been introduced in the maintenance of stipulated CRR by the scheduled banks. Thus, with effect from the fortnight beginning from 6 November 1999, the prescribed CRR during a fortnight has to be maintained by every bank based on its NDTL as on the last Friday of the second preceding fortnight i.e. based on the NDTL as on reporting Friday, 22 October 1999 and so on.

2.1.9 Maintenance of Cash Balances
(i) Every scheduled bank is required to maintain a Principal Account with the Deposit Accounts Department (DAD) of the Reserve Bank of India at the centre where the principal office of the bank is located. The account with the Reserve Bank is intended for maintenance of Bank's statutory deposit and operations thereon should be confined to interbank transactions and for payment to the Reserve Bank and Government Departments. No cheques should be issued in favour of third parties such as private individuals, firms, etc.

(ii) If a scheduled bank has no office or branch at any place where the RBI has an office of its Banking Department, it may be allowed to keep an account with any Issue Department of the RBI as the RBI may, in its discretion, permit in this behalf, but such account shall be limited to the following transactions:

(a) the adjustment of credits and debits with the Bank;
(b) remittances to and from other offices of the Banking Department or branches of the Issue Department at which the said Scheduled bank maintains an account;
© the adjustment of credits and debits with the local branch of the State Bank.

2.1.10 Interest on Eligible CRR Balances
With effect from fortnight beginning November 3, 2001, scheduled banks are being paid interest at the Bank Rate (presently 6.0%) under section 42 (1B) of the RBI Act, 1934 on all eligible cash balances maintained with by the banks u/s 42(1)& 42(1A) of the act ibid with RBI. The eligible cash balances are the cash balances maintained in excess of the statutory minimum prescription of 3% of NDTL excluding shortfall, if any. With effect from the fortnight ending April 2003, the interest shall be paid on a monthly basis.

2.1.11 Reporting Requirements
(i) In terms of section 42(2) of the RBI Act, 1934, every scheduled bank is required to send to the Reserve Bank, a return in Form B (Annexure 2), at the close of business on each alternate Friday within seven days after the date to which it relates, duly signed by two responsible officers of bank, containing the information relating to the following:

(a) Liabilities to the Banking System in India
(b) Liabilities to others in India
(c) Assets with the Banking System in India
(d) Cash in India
(e) Investments in India (at book value)
(f) Bank credit in India

(ii) Where such alternate Friday is a public holiday under the Negotiable Instruments Act, 1881, for one or more offices of the bank, the return should give the preceding day's figures in respect of such office or offices, but should nevertheless be deemed to relate to that Friday.

(iii) Where the last Friday of a month is not an alternate Friday for the purpose of the above return, the banks should send to RBI, a special return in Form B giving the same details as specified above as at the close of business on such last Friday or where such last Friday is a public holiday under the Negotiable Instruments Act, 1881, as at the close of business on the preceding working day and such return should also be submitted within seven days after the date to which it relates.

(iv) Banks are required to calculate the proportion of their savings bank deposits as at the close of business on the 31st March and 30th September, into demand and time liabilities in terms of Regulation 7 of the RBI Act, Scheduled Bank’s Regulations, 1951 and report in the prescribed form given in Annexure 2.

(v) Whenever there are wide variations between the sources and uses of funds as being reported in the fortnightly return and the variations exceed 20%, the banks concerned should advise the reasons for such wide variations in the return.

(vi) In terms of Regulation 5(1)(c) of the Scheduled Banks' Regulations, the banks are required to furnish a list of the names, the official designations and specimen signatures of the officers of the bank who are authorised to sign on behalf of the bank returns prescribed under Section 42(2) of the Act, of whom only two may sign such return. The bank has to submit to RBI fresh set of signatures whenever there is change in the incumbency. The banks should forward to RBI the specimen signatures of officials (restricted to four) who are authorised to sign the periodical statements of interest claims on CRR balances in the proforma given in Annexure 3. These signatures should be attested by the official whose signature is already on RBI record.

2.1.12 Penalty

2.1.13 Penalty for Non submission/delayed submission of return: Failure to submit the return/late submission of the return attracts the provisions of section 42 (4) of RBI Act, 1934 and the banks are liable for imposition of penalties as indicated therein.

2.1.14 Penalty on default in maintenance of required CRR: (a) In the event of nonmaintenance of the minimum level of CRR balance required to be maintained by a scheduled bank on each of the days of the reporting fortnight, the bank will not be paid interest on eligible cash balances for the number of days of such default.

(b) If a bank defaults in maintenance of the required CRR balance in the aggregate, penal interest at the rate of 25% p.a. (for the fortnight) on the amount of aggregate shortfall is calculated and reduced from the interest payable on eligible cash balances of that fortnight.

(c) In case 25% penalty is not recoverable from the interest payable on the eligible cash balances of the fortnight, the bank shall be liable to pay to Reserve Bank penal interest at a rate of 3% above the Bank Rate on the amount of shortfall from the prescribed minimum.

(d) Further, if during the next succeeding fortnight, such average daily balance is still below the prescribed minimum, the rate of penal interest shall be increased to 5% above the Bank Rate in respect of that fortnight and each subsequent fortnight during which the default continues.

(e) Every director, manager, or secretary of the scheduled bank, who is knowingly and wilfully a party to the default, shall be punishable with fine which may extend to five hundred rupees and with a further fine which may extend to five hundred rupees for each such subsequent fortnight during which default continues,

(f) The Reserve Bank may prohibit the scheduled bank from receiving any fresh deposit after the said fortnight, and, if default is made by the bank in complying with the prohibition referred to in clause (f), every director and officer of the bank who is knowingly and wilfully a party to such default or who through negligence or otherwise contributes to such default shall in respect of each such default be punishable with fine which may extend to five hundred rupees and with a further fine which may extend to five hundred rupees for each day after the first, on which a deposit received in contravention of such prohibition is retained by the scheduled bank

2.2 Non-Scheduled PCBs
2.2.1 Cash Reserve Ratio (CRR)
(i) In terms of section 18 of the Banking Regulation Act (B.R.Act) 1949 (As applicable to co-operative societies)(AACS) every PCB (not being a scheduled bank) is required to maintain on a daily basis cash reserve, the amount of which shall not be less than 3% of its DTL as obtaining on the last Friday of the second preceding fortnight.

(ii) For the purpose of computation of liabilities, the liabilities of PCBs to the Banking System as computed under clause (d) of explanation to section 18(1) of the BR Act, 1949 (AACS) are to be reduced from the total demand and time liabilities.

(iii) In terms of section 18 (2) of the B.R. Act, 1949 (AACS), the Reserve Bank is empowered to specify from time to time, with reference to any transactions or class of transactions which shall be treated as liability in India of a PCB.

2.2.2 Computation of Net Demand & Time Liabilities for CRR
The procedure followed for working out net inter-bank liabilities for the purpose of CRR should be in accordance with clause (d) of explanation to section 18(1) of the B.R. Act, 1949.The amount of net inter-bank liabilities is to be calculated after reducing 'assets with banking system' from 'liabilities to the banking system'. If it is a positive figure, it should be added to 'liabilities to others' to arrive at total net demand and time liabilities. If it is a negative figure, net inter-bank liabilities would be considered as zero and 'liabilities to others' would be considered as total net demand and time liabilities. For the purpose of working out liabilities, subject to a prescribed CRR if net interbank liabilities is positive it should be deducted from total net demand and time liabilities. However, for the purpose of working out minimum CRR of 3% on total net demand and time liabilities net inter-bank liabilities should also be included. The computation of DTL, liabilities to the banking system, assets with the banking system, and net demand and time liabilities, etc. are explained in detail in Annexure 4.

2.2.3 Maintenance of Cash Balances

(i) The obligation to maintain the required percentage of cash reserve of the DTL arises on each day of a fortnight commencing from Saturday and ending with the second following Friday.

(ii) The compliance with the obligation is monitored ordinarily with reference to the position of DTL and amount of CRR as on the relevant alternate Friday.

2.2.4 Reporting Requirements
(i) Non-scheduled banks are required to submit a Return in Form I, as per proforma given in Annexure 5, to the concerned Regional Office not later than 20 days after the end of the month to which it relates showing the position, inter alia, of cash reserve maintained by the banks under section 18 of the B.R. Act, 1949 (AACS) as at the close of business on each alternate Friday during the month, with particulars of its DTL in India on such Fridays or if any such Friday is a public holiday under the Negotiable Instruments Act, 1881, at the close of business on the preceding working day.

(ii) Non-scheduled banks are required to furnish in Appendix I, as per proforma given in Annexure 6, along with the Return in Form I showing the position of the -

(a) cash reserve required to be maintained under section 18 of the act, ibid.
(b) cash reserve actually maintained, and the
(c) extent of deficit/surplus for each day of the month.

2.2.5 Penality

Non-scheduled banks should ensure to maintain the required cash reserve and submit the prescribed return along with Appendix I within the stipulated time to the concerned Regional Offices. Failure to submit the return in time attracts the provisions of section 46(4) of the Act ibid, and the banks are liable to imposition of penalties as indicated therein. The banks should, therefore, in their own interest ensure that the stipulations of the section 18 referred to above are strictly adhered to.

3.1 Statutory Liquidity Ratio (SLR)
In terms of section 24(2A)(a) of the B.R. Act, 1949 (AACS), every bank (scheduled and non-scheduled), is required to maintain, on daily basis, liquid assets, the amount of which shall not be less than 25% or such other percentage not exceeding 40%, as may be notified by RBI, of its demand and time liabilities in India as on the last Friday of the second preceding fortnight.

3.2 Current Prescription for SLR
Presently the banks are required to maintain a uniform SLR of 25% on their total DTL in India.

3.3 Calculation of SLR
3.3.1 The obligation to maintain the required liquid assets arises on each day of a fortnight commencing from Saturday, and ending with the second following Friday.
3.3.2 The compliance with this obligation is monitored ordinarily with reference to the position of the SLR as on the relevant alternate Friday as shown in the return in Form I.

3.3.3 Banks are also required to maintain SLR on borrowing through CBLO. However, securities lodged in the Gilt Account of the bank maintained with CCIL under CSGL facilities remaining unencumbered at the end of any day can be reckoned for SLR purposes by the concerned bank. For this purpose, CCIL will provide a daily statement to banks/RBI listing the securities lodged/utilized/remaining unencumbered.

3.4 Manner of Maintaining Statutory Liquidity Reserves
3.4.1 The liquid assets may be maintained -

(i) in cash, or
(ii) in gold valued at a price not exceeding the current market price, or
(iii) in unencumbered approved securities valued at a price determined in accordance with such one or more of, or combination of the methods of valuation, namely, valuation with reference to cost price, market price, book value or face value, as may be specified by the Reserve Bank of India from time to time.

3.4.2 The following shall be deemed to be “cash maintained in India”:
(i) any excess balance maintained, by a scheduled PCB, with RBI over and above CRR requirement, and

(ii) any cash or balances maintained in India by a co-op bank, other than a scheduled bank, with itself or with the state co-op bank of the state concerned, or in the current account with Reserve Bank or by way of net balance in the current accounts and, in the case of a primary coop. bank, also any balances maintained with central co-op. bank of the district concerned, in excess of the cash or balances required to be maintained under section 18 of net balances in current accounts.

3.4.3 Legally speaking, the banks may invest in gold (including gold ornaments) to maintain liquid assets. However, such investments are of unproductive nature and yield no income, except price increase, which is subject to speculative forces. Keeping these aspects in view as well as the difficulties involved in valuation, safe keeping, etc., the bank should not invest in gold to maintain liquid assets for the SLR purposes.

3.4.4 Explanations / Requirements regarding Approved Securities
(i) In terms of section 5(a) of BR Act, 1949 (AACS) approved securities for the purpose of section 24 of the Act, means securities in which a trustee may invest money under clause (a), (b), (bb), (c) or (d) of section 20 of the Indian Trusts Act, 1882 and;

(ii) Such of the securities authorised by the Central Government under clause (f) of section 20 of the Indian Trust Act, 1882.

It may, however, be noted that all securities under section 20 of the Indian Trusts Act, 1882 cannot be considered as approved securities for the purpose of section 24 of the act ibid. Approved securities should be such trustee securities which have been specified as eligible securities for the purpose of section 24, ibid by Reserve Bank. In case of any doubt regarding the classification of a security for the purpose of section 24, the banks may seek clarifications from Reserve Bank.

(iii) Banks may reckon their reserve fund investments in fixed deposits, or the investments in approved securities as SLR assets provided they are unencumbered.

(iv) Unencumbered approved securities include such securities lodged with another institution for an advance or any other credit arrangement to the extent to which such securities have not been drawn against or availed of.

(v) Unencumbered deposits with state/district central co-operative bank of the state/district concerned :

(a) Wherever a district is served by more than one central co-operative bank, the area of operations of each central co-operative bank within the district is quite distinct and separate as per the provisions of the by-laws of the concerned central co-operative bank. The primary cooperative banks operating in the area of the concerned central co-operative bank in the district will be normally affiliated to that central co-operative bank. Therefore, the concerned central co-operative bank in the district to which the primary co-operative bank is affiliated, or in whose area the primary co-operative bank has its registered office, will be the central cooperative bank of the district concerned for the purposes of Sections 18 & 24 of the B.R. Act, 1949.

(b) where a primary co-operative bank operates beyond such area, by opening branches in areas served by other central co-operative banks in the district, it can treat its balances with latter also as cash reserve or liquid assets, as the case may be.

3.5 Minimum SLR holding in Government Securities:
3.5.1 At present, the primary (urban) co-operative banks are required to invest in government and other approved securities as indicated below:



Sr.No.	Category of banks	Minimum SLR holding in Government and other approved securities as percentage of Net Demand and Time Liabilities (NDTL)
1.	Scheduled banks	25%
2.	Non-Scheduled banks a) With NDTL of Rs. 25 crore & above	15%
	b) With NDTL of less than Rs. 25 crore	10%



3.5.2 All the PCBs are required to maintain investments in government securities only in SGL Accounts with Reserve Bank or in Constituent SGL Accounts of scheduled commercial banks, Primary Dealers (PDs), State Co-op. Banks, and Stock Holding Corporation of India Ltd. or in the dematerialised accounts with depositories such as National Securities Depositories Ltd (NSDL), Central Depository Services Ltd., (CDSL) and National Securities Clearing Corporation Ltd. (NSCCL).

3.5.3 The banks achieving the Rs.25 crore NDTL level or getting scheduled bank status, would be required to achieve the applicable level of investments in Government/other approved securities within a period of three months from the date of the said achievement.

3.6 Valuation of Securities for SLR
3.6.1 The entire investment portfolio of the banks should be classified under three categories viz ‘ Held to Maturity (HTM); ‘Available for Sale’(AFS) and ‘Held for Trading (HFT).

3.6.2 Investments classified under 'Held to Maturity' category need not be marked to market and will be carried at acquisition cost unless it is more than the face value, in which case the premium should be amortised over the period remaining to maturity.

3.6.3 Individual scrip in the ‘Available for Sale’ category will be marked to market at the year-end or at more frequent intervals. While the net depreciation under each classification should be recognised and fully provided for, the net appreciation should be ignored. The book value of the individual securities would not undergo any change after the revaluation.

3.6.4 Individual scrip in the "Held for Trading" category will be marked to market at monthly or at more frequent intervals, the book value of individual securities in this category would not undergo any change after marking to market i.e. while the net depreciation in the value of investments, if any, shall be provided for, net appreciation, if any, should be ignored. Net depreciation required to be provided for any one category should not be netted with net appreciation in any other category.

3.6.5 Book value of eligible securities in the investment portfolio, after adjustment of provision held for depreciation in the value of investments should be reckoned for the purpose while furnishing data to the concerned Regional Office of Urban Banks Department. A format for reporting the data is given in Annexure 7. Information in the format may be furnished as an annexure, to return in Form I, only to the concerned Regional Office of this department with effect from 2003.The monthly return should contain information of the fortnights following in the respective months.

3.7 Computation of Net Demand & Time Liabilities for SLR
3.7.1 The net liabilities to the ‘Banking System’ as computed under clause (d) of explanation to section 18(1) of the B.R.Act,1949 are exempted from maintenance of SLR.

3.7.2 The procedure followed for working out net inter-bank liabilities for the purpose of SLR should be in accordance with clause (d) of explanation to section 18(1) of the BR Act, 1949. The procedure to compute total net demand and time liabilities for the purpose of SLR and minimum SLR of 25% under section 24(1) of BR Act, 1949 must be similar to procedure followed for CRR purposes as detailed in Annexure 4.

3.7.3 In terms of clause (d) of explanation to section 18(1) of the BR Act, 1949 (AACS) the amount of net inter-bank liabilities is to be calculated after reducing 'assets with banking system' from 'liabilities to the banking system'. If it is a positive figure, it should be added to 'liabilities to others' to arrive at total net demand and time liabilities. If it is a negative figure, net inter-bank liabilities would be considered as zero and 'liabilities to others' would be considered as total net demand and time liabilities. For the purpose of working out liabilities, subject to a prescribed SLR under the law, if net inter-bank liabilities is positive it should be deducted from total net demand and time liabilities.

However, for the purpose of working out minimum SLR of 25% on total net demand and time liabilities net inter-bank liabilities should also be included. The computation of demand and time liabilities, liabilities to the banking system, assets with the banking system, and net demand and time liabilities, etc. are explained in detail in Annexure 4.

3.8 Reporting Requirements
3.8.1 All PCBs (scheduled and non-scheduled), are required to submit a return in Form I under section 24 of the Banking Regulation Act, 1949 (as applicable to co-operative societies) every month showing the position of liquid assets maintained under the said section as at the close of business on each alternate Friday during the month. The return should be submitted to the concerned Regional Office every month not later than 20 days after the end of the month to which the said return relates. Detailed guidelines for compilation are given in Annexure 5.

[Note: In respect of Non-Scheduled Primary (Urban) Co-operative Banks, Return in Form I is common for reporting cash reserves and statutory liquid assets.]

3.8.2 With effect from the month of February 1994, all banks (scheduled and non-scheduled) are required to furnish Appendix II, as per proforma given in Annexure 8, along with the Return in Form I showing the position of -

(i) statutory liquid assets required to be maintained under Section 24 of the Act,

(ii) liquid assets actually maintained, and

(iii) the extent of deficit/surplus for each day of the month.

3.9 Penal Provisions
3.9.1 In terms of section 24(4)(a) of the BR Act, 1949, if on any alternate Friday or, if such Friday is a public holiday, on the preceding working day, the amount maintained by any bank at the close of business on that day falls below the minimum prescribed by or under clause 24(2A)(a), the bank shall be liable to pay to the RBI in respect of that day’s default, penal interest for that day at the rate of 3% per annum above the bank rate on the amount by which the amount actually maintained falls short of the prescribed minimum on that day.

3.9.2 Further, vide section 24(4)(b), if the default occurs again on the next succeeding alternate Friday, or, if such Friday is a public holiday, on the preceding working day, and continues on succeeding alternate Fridays or preceding working days, as the case may be, the rate of penal interest shall be increased to a rate of 5% per annum above the bank rate on each such shortfall in respect of that alternate Friday and each succeeding alternate Friday or preceding working day, if such Friday is a public holiday, on which the default continues.

3.9.3 Without prejudice to the provisions of section 24(4), on the failure of any bank to maintain on any day, the amount so required to be made by or under clause (a) of section 24(2A), the RBI under Section 24(5)(a) may, in respect of such default, require the concerned bank to pay penal interest for that day as provided in section 24(4)(a) and if the default continues on the next succeeding working day, the penal interest may be increased as provided in section 24(4)(b) for the concerned days.

3.9.4 Banks should invariably ensure to maintain the required SLR and submit the prescribed return along with Appendix II (Annexure 8) within the stipulated time to concerned Regional Offices. Failure to submit the return in time will attract the provisions of section 46(4) of the Act ibid. and the banks will be liable to imposition of penalties as indicated therein.

3.9.5 Where it is observed that banks are persistently defaulting despite instructions and repeated advises, the Reserve Bank in addition to levy of penalty on such defaulting banks, may be constrained to consider cancelling the license in case of licensed banks and refuse license in case of unlicensed banks under section 22 of the Act, ibid. The banks should, therefore, in their own interest ensure maintenance of statutory liquidity ratio at prescribed rates and be very prompt in submission of Return to RBI offices.

4.1 CRR/SLR REGISTER
4.1.1 In order to monitor the day-to-day position of liquidity of the bank, all PCBs are required to maintain a register, as per format given in Annexure 9, showing the daily position of cash reserve and liquid assets maintained under sections 18 and 24 of the B.R.Act,1949 (AACS).

4.1.2 The work of maintaining the register on daily basis may be entrusted to a responsible official and it should be put up daily to the chief executive officer, who is responsible for ensuring compliance with the statutory liquidity requirements at the close of business every day.

4.1.3 To facilitate compilation of figures under various heads of the register, the explanations in respect of each item which form part of the Rules, as footnotes to form I are given in the Annexure 10.

4.2 Other Penal Provisions
4.2.1 Apart from maintenance of CRR and SLR at the prescribed rates, banks are also required to submit relative statutory returns well in time to the concerned Regional Office of RBI. Any violation of these statutory requirements, apart from levy of penal interest would also attract penalties under Section 46(4), read with Section 56 of the B.R. Act 1949.

4.2.2 Whenever, any bank fails to maintain the requisite amount of Cash Reserve/Liquid Assets, it should explain the reasons for default in the letter forwarding the return.

Annexure 1

1. STCI
   
   
2. PNB Gilts Ltd.
   
   
3. SBI Gilts Ltd.
   
   
4. Gilt Securities Trading Corporation Ltd.
   
   
5. ICICI Securities and Finance Ltd.

2) Balances of overdue time deposits of above named banks.										Within the3) Participation Certificates payable on demand issued to banks.		definition of ‘banking								system’4) Interest accrued on deposits of banks (RRBs).*5) Call Money Borrowings from the banks.(iii) Time liabilities to the ‘banking system’ include -(a) All types of time deposits from the banks(b) Certificates of deposits from the banks				Within the								definition of ‘banking(c) Participation Certificates issued to banks which			system’are not payable on demand(d) Interest accrued on time deposits/CDs of banks *

* If it is not possible to classify/segregate this amount from interest accrued on deposits, the aggregate interest accrued may be shown under ‘Other Demand and Time Liabilities’.

2) Balances of overdue time deposits of above named banks.3) Participation Certificates payable on demand issued to banks.			Within the								 definition of ‘banking4) Interest accrued on deposits of banks (RRBs).*				system’5) Call Money Borrowings from the banks.(iii) Time liabilities to the ‘banking system’ include -(a) All types of time deposits from the banks(b) Certificates of deposits from the banks									Within the(c) Participation Certificates issued to banks which		 	 definition of ‘bankingare not payable on demand							system’(d) Interest accrued on time deposits/CDs of banks *