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Question
Every financial institution has to maintain a certain quantity of liquid assets with themselves at any point of time of their total time and demand liabilities. These assets have to be kept in non-cash form such as precious metals, approved securities like bonds etc. The ratio of the liquid assets to time and demand liabilities is termed as _____.
Every financial institution has to maintain a certain quantity of liquid assets with themselves at any point of time of their total time and demand liabilities. These assets have to be kept in non-cash form such as precious metals, approved securities like bonds etc. The ratio of the liquid assets to time and demand liabilities is termed as _____.
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Solution
The correct option is A Statutory Liquidity Ratio
SLR is defined as the quantity of liquid assets that all commercial banks must keep with themselves, as a fraction of the total deposits in the bank.
Statutory Liquidity Ratio
SLR is defined as the quantity of liquid assets that all commercial banks must keep with themselves, as a fraction of the total deposits in the bank.
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