Which of the following statements is are true regarding Scheduled Banks 1 n...........

Economic Affairs Types of Banks and Banking

Which of the following statements is/are true regarding Scheduled Banks?

1. Scheduled Banks are those banks which are included in the Second Schedule ofthe Reserve Bank Act, 1934.

2. It has paid up capital and reserve aggregate value of not less than Rs. 5crores.

3. Scheduled banks are eligible for loans from the Reserve Bank of India at bank rate, and are given membership to clearing houses.

Select the correct answer using the codes given below

1 only

1 and 2 only

1 and 3only

None of the above

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Explanation:

Banks are broadly classified into two types-Scheduled Banks and Non-scheduled Banks. Scheduled banks are those banks which are included in the second schedule of the Reserve Bank Act, 1934. They satisfy two conditions under the RBI Act:

• Paid up capital and reserves of an aggregate value of not less than Rs. 5 lakh.

• It must satisfy RBI that its affairs are not conducted in a manner detrimental to the depositors. Scheduled banks are eligible for loans from the Reserve Bank of India at bank rate, and are given membership to clearing houses. The list includes the State Bank of India and its subsidiaries (like State Bank of Travancore), all nationalised banks (Bank of

Baroda, Bank of India et(c), regional rural banks (RRBs), foreign banks (HSBC Holdings Plc, Citibank N(A) and some co-operative banks. These also include private sector banks, both classified as old (Karur VysyaBank) and new (HDFC Bank Lt(d).