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RBI expected to consider dividend payout this week
May 17, 2023
The Reserve Bank of India’s board is expected board to meet on Friday when it is expected to consider a dividend payout to the government, news agency Bloomberg reported on Tuesday citing sources.
The report said that the meeting will be held in Mumbai wherein it might review its finances and how much it can transfer to the government during its May board meeting.
For FY22, the central bank transferred a surplus of ₹30,307 crore to the Centre.
ET earlier in May had reported that the central government is likely to make windfall gains by way of annual dividend receipts from the RBI, which is estimated to have garnered substantial profits in foreign-currency trading and by lending to the local banking system after the rise in policy rates and liquidity drainage prompted high-street lenders to borrow more from the RBI.
The Budget has estimated receipts of ₹48,000 crore in FY24 by way of total dividends from public sector banks and the RBI.
“Given the large levels of dollar sales and low provisioning requirements, the RBI dividend is expected to exceed Budget estimates,” Gaura Sengupta, India economist, IDFC First Bank, said in her recent report. “We estimate that the dividend from the RBI could range between ₹70,000 crore and ₹80,000 crore. The better-than-expected RBI dividend will balance some of the risks facing tax revenue collections, from slower-than-budgeted nominal GDP growth.”
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