Financial Daily from THE HINDU group of publications
Tuesday, Aug 30, 2005
Financial Daily from THE HINDU group of publications Tuesday, Aug 30, 2005 |
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Money & Banking
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RBI & Other Central Banks RBI earns more globally Our Bureau
Mumbai , Aug 29 THE Reserve Bank of India (RBI) has earned more from its foreign and less from domestic investments during 2004-2005. Increase in the level of foreign currency assets, hardening of short-term interest rates in the US and lower market to market depreciation on securities resulted in higher earnings from foreign sources. RBI's earnings from foreign sources increased to Rs 16,979.47 crore (Rs 9,103.50 crore). Domestic income fell to Rs 2,048.81 crore (Rs 5,220.20 crore) on account of booking substantially higher depreciation in the value of the rupee securities as the yields hardened during the year, lower availment of Ways and Means Advances (WMA) by Central and State Governments, investment of Government of India surplus balances in rupee securities from the Bank's portfolio and earmarking of certain securities to cover the liabilities in provident fund, superannuation fund and encashment of ordinary leave fund. The net interest income on rupee securities was negative on account of higher depreciation during the year. RBI's gross income for the year 2004-05 was Rs 19,028.28 crore, against Rs 14,323.70 crore in 2003-04, an increase of Rs 4,704.58 crore or 32.8 per cent. However, net income fell to Rs 12,215.27 crore (Rs 13,166.14 crore). Gross income comprises Transfer To Contingency Reserve, which increased to Rs 6,125.92 crore (Rs 969.47 crore), Asset Development Reserve, which rose to Rs 687.09 crore (Rs 188.09 crore) and Surplus (profits) transferred to Government remains unchanged at Rs 5,400 crore. The interest income on WMA declined to Rs 174.10 crore (Rs 370.52 crore), which indicates lesser government borrowing, at Central and State level. Total expenditure declined to Rs 6,811.27 crore, (Rs 7,762.14 crore), a fall of Rs 950.87 crore or 12.3 per cent. Interest payment decreased to Rs 1,386.28 crore (Rs 1,808.48 crore). Other liabilities include the internal reserves and provisions of RBI and net credit balance in the RBI General Account. These liabilities declined to Rs 1,00,356.27 crore (Rs 1,29,929.49 crore) mainly on account of decrease in levels of Currency and Gold Revaluation Account (CGRA). The balance in the CGRA fell to Rs 26,906.21 crore (Rs 62,283.04 crore), due to increase in level of foreign currency assets during 2004-05 and appreciation of rupee against US dollar and appreciation of dollar against other currencies. Foreign currency assets rose to Rs 5,75,863.66 crore (Rs 5,24,865.01 crore), due to net purchases of US dollars from market and interest and discount received, net of revaluation losses. Investment in Government securities increased to Rs 68,476.48 crore (Rs 40,179.74 crore). Other assets declined to Rs 14,403.57 crore (Rs 14,459.77 crore). These comprise fixed assets, gold holdings in the banking department, amounts spent on projects pending completion and staff advances.
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