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Question

The Reserve Bank of India regulates the commercial banks in matters of:
1) liquidity of assets
2) branch expansion
3) merger of banks
4) winding-up of banks
Select the correct answer using the codes given below.

A
1 and 4
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B
2, 3 and 4
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C
1, 2 and 3
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D
1, 2, 3 and 4
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Solution

The correct option is D 1, 2, 3 and 4
RBI is called the banker's bank and regulates the banking sector in India. By using mechanisms like CRR, SLR etc, it keeps a check on liquidity of assets of the banks. Moreover, RBI also sets rules and regulations concerning merger of banks, their winding-up operations and branch expansion.

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