Section 24 of the Banking Regulation Act, 1949 – Maintenance of Statutory Liquidity Ratio (SLR) –Marginal Standing Facility (MSF) – Extension of Relaxation
Please refer to our circulars DOR.No.Ret.BC.52/12.01.001/2019-20 dated March 27, 2020, DOR.RRB.No.28/31.01.001/2020-21 dated December 4, 2020 and Press Release No.2020-2021/401 dated September 28, 2020 on Marginal Standing Facility (MSF), wherein the banks were allowed to avail of funds under the MSF by dipping into the Statutory Liquidity Ratio (SLR) up to an additional one per cent of their net demand and time liabilities (NDTL), i.e., cumulatively up to three per cent of NDTL. This facility, which was initially available up to June 30, 2020 was later extended in phases up to March 31, 2021 providing comfort to banks on their liquidity requirements and also to enable them to meet their Liquidity Coverage Ratio (LCR) requirements.
2. As announced in the Statement of Developmental and Regulatory Policies of February 05, 2021, with a view to providing comfort to banks on their liquidity requirements, banks are allowed to continue with the MSF relaxation for a further period of six months, i.e., up to September 30, 2021.
