Bill to transfer RBI shareholding in NHB to Centre
30 April 2012 7:51 PM GMT
To enable RBI to focus on its supervisory function and avoid clash between its regulatory and ownership roles, a bill has been introduced in the Lok Sabha to transfer shareholding of the country's central bank in the National Housing Bank to the Centre.
The National Housing Bank (Amendment) Bill, 2012 introduced by Finance Minister Pranab Mukherjee also seeks to transfer the registration and regulation related powers of the National Housing Bank (NHB) over housing finance companies to the RBI to ensure uniform control over non-banking financial companies.
Once the bill is passed, the NHB will concentrate on supervision and financing of such institutions.
The amendment proposes to provide for transfer of surplus by the NHB to the central government. The Centre will now be empowered to hike the authorised capital of NHB through a notification, instead of the RBI.
After getting ownership of NHB, the government would also have a greater say in the board of the institution and the flexibility to issue directions to meet its credit objectives for the priority sector.
At present, the NHB is wholly-owned by the RBI with a paid-up capital of Rs 450 crore.
The Narasimhan Committee had recommended the transfer of RBI's stake in State Bank of India, NABARD and NHB to the government to differentiate the central bank's role as the owner of banks and the sector regulator.
In 2007, the government had acquired 59.73 per cent stake held by RBI in the country's largest bank, SBI, for Rs 35,531.33 crore.
The NABARD stake transfer took place in 2010.
The National Housing Bank (Amendment) Bill, 2012 introduced by Finance Minister Pranab Mukherjee also seeks to transfer the registration and regulation related powers of the National Housing Bank (NHB) over housing finance companies to the RBI to ensure uniform control over non-banking financial companies.
Once the bill is passed, the NHB will concentrate on supervision and financing of such institutions.
The amendment proposes to provide for transfer of surplus by the NHB to the central government. The Centre will now be empowered to hike the authorised capital of NHB through a notification, instead of the RBI.
After getting ownership of NHB, the government would also have a greater say in the board of the institution and the flexibility to issue directions to meet its credit objectives for the priority sector.
At present, the NHB is wholly-owned by the RBI with a paid-up capital of Rs 450 crore.
The Narasimhan Committee had recommended the transfer of RBI's stake in State Bank of India, NABARD and NHB to the government to differentiate the central bank's role as the owner of banks and the sector regulator.
In 2007, the government had acquired 59.73 per cent stake held by RBI in the country's largest bank, SBI, for Rs 35,531.33 crore.
The NABARD stake transfer took place in 2010.
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