The Deposit Insurance and Credit Guarantee Corporation (DICGC), which provides insurance coverage to depositors of banks, collected a deposit insurance premium of Rs 9,561 crore from banks during the semester. closed in September 2021, of which 93.5% was paid by commercial banks and the rest by cooperative banks.
With this, the Deposit Insurance Fund (DIF), built from premiums paid by insured banks and income from coupons collected on investments in government securities, rose to Rs 1.41 lakh crore in September 2021. , producing a reserve ratio (ratio of DIF to insured deposits) of 1.81%, up from Rs 1.29 lakh crore in March 2021, the RBI said in the Financial Stability Report (FSR).
Bank debt settlement and collection in the first half of 2021-2022 was significantly higher than a year ago, the central bank said. As of December 20, 2021, the DICGC has paid Rs 1,374 crore for 1.09 lakh depositors from 16 of the 21 troubled banks – including PMC Bank – who were eligible to receive such payments, he said.
The DICGC, headed by RBI Deputy Governor Michael Patra, pays a maximum of Rs 5 lakh as insurance to a troubled bank depositor, regardless of the total amount the client has deposited to the bank. Bank. It paid depositors Rs 393 crore in the first six months of the six-month period ended September 2021, an increase of 1,334% from Rs 27.4 crore during the same period last year.
The number of insured banks registered as of September 30, 2021 stood at 2,049, including 140 commercial banks (including 43 RRBs, two LABs, six payment banks and 11 small financing banks) and 1,909 cooperative banks. With the current deposit insurance limit at Rs 5 lakh, 98.1% of total deposit accounts, amounting to 267.2 crore, and 49.0%, amounting to Rs 78.02 lakh crore, of the total assessable deposits are fully protected, the RBI said. .
The 1961 DICGC law was amended in August 2021 to provide for the time-limited (provisional) payment of deposits to depositors up to the insured amount in the case of banks with restrictions on the withdrawal of deposits imposed by the Bank. reserve. Under the amendment which came into effect on September 1, 2021, the insured bank is required to submit its claim within 45 days of the imposition of such restrictions and the Company is to have the claims verified within 30 days and paid. depositors in the next 15 days.
The amendment empowers the DICGC to make interim deposit insurance payments to troubled banks, even if they fall under the overall Reserve Bank (IDA) guidelines, within 90 days of the imposition of those guidelines.
In the event that the Reserve Bank deems it appropriate to submit the bank to a merger / compromise or arrangement / reconstruction plan, the liability of the Company will be extended for a further period of 90 days. Other changes include increasing the limit of 15 paise per Rs 100 deposits on insurance premiums with the approval of the Reserve Bank. In addition, the DICGC, with the approval of its board of directors, may defer or modify the repayment period for the insured bank to fulfill its liability to the DICGC and charge penalty interest of 2% on the rate. reverse repo in case of delay, he said.
CEOs of pvt banks receive 67 times the salary of a typical employee
MUMBAI: There is a huge gap between the compensation paid to the CEO of a private bank and its employees.
“For PSU banks, on average, CEOs earn 3 times the typical employee, while the same amount was as high as 75 times in the case of small financial banks and 67 times in the case of private banks,” said the RBI in its report. on the trend and progress of the bank. The corresponding multiple was low for foreign banks because the remuneration received by employees is relatively high. The variation between banking groups remained constant in 2018-2019 and 2019-2020, he said.
On November 4, 2019, the Reserve Bank revised its compensation guidelines, bringing them into line with Financial Stability Board standards. The new guidelines came into effect on April 1, 2020.