Govt may acquire RBI`s stake in Nabard, NHB by Dec
The government is likely to pick up Reserve Bank`s stake in the National Bank of Agriculture and Rural Development and National Housing Bank by December this year.
New Delhi: The government is likely to pick
up Reserve Bank`s stake in the National Bank of Agriculture
and Rural Development and National Housing Bank by December
The stake transfer from RBI to the government would take
place by December 31, official sources said.
In Budget 2009-10, the government earmarked Rs 1,542
crore for acquiring Reserve Bank`s holding in the two
regulators Nabard and NHB.
For Nabard`s stake buy, the Centre made a provision of Rs
1,100 crore and for that of NHB Rs 442 crore was assigned.
At present, the RBI holds about 72.5 percent stake in
Nabard and the remaining lies with the government. While, NHB
is wholly-owned by the Reserve Bank.
The total paid-up capital of Nabard currently stands
at Rs 2,000 crore, NHB was capitalised at Rs 350 crore when it
was set up in 1988.
It was the Narasimhan Committee that recommended the
transfer of RBI`s stake in State Bank of India, Nabard and NHB
to the government to differentiate the central bank`s
functioning as the owner of banks and the sector regulator.
In 2007, the government acquired 59.73 percent stake
held by RBI in the country`s largest bank SBI for Rs 35,531.33
Sources said the stake transfer is not likely to affect
the functioning of rural credit delivery system in the
country as the policies in this regard will continue to be
shaped by the government in consultation with RBI.
After getting ownership of SBI, NABARD and NHB, the
government will also have greater say in the boards of these
institutions, besides flexibility to issue directions to meet
its credit objectives for the priority sector.