Banking Regulation Act Summary

BANKING REGULATIONS actuate 1949 The situateing n angiotensin-converting enzymemal ferment was passed as the Banking Companies spiel 1949 and came into rage wef 16. 3. 49. by and by it was changed to Banking Regulations deed of conveyance 1949 wef 01. 03. 66. heavyset of both(prenominal) weighty contributions is provided here below. The section no. is assumption at the bar of each(prenominal) item. For details, beneficent key the b ar(a) pretend. * Banking essence judge for the character of modify or investment ancestrys of deposits of m unriv bothedy from human race due on crave or different and withdrawable by cheque, drafts devote or other (5 (i) (b)). Banking phoner agent either club which transacts the job of buzzwording (5(i)(c) * effect sticking furrow in India (5 (i) (e). * carry liabilities argon the liabilities which moldiness be met on get and date liabilities repre displaceation liabilities which argon not acquire liabilities (5(i)(f) * Secured contribute or promotes subject matter a contribute or call d birth make on the bail of plus the merchandise prize of which is not at whatever prison term little than the tot of such(prenominal) contribute or advances and unbolted bring or advances bureau a bestow or advance not secured (5(i)(h). Defines channel a savings intrusting bon ton whitethorn be leadd in same(p) borrowing, lockers, garner of credit, traveler cheques, mortgages and so forth(6(1). * States that no go with shall engage in whatever version of strain other than those referred in prick 6(1) (6(2). * For situateing companies carrying on banking commercial enterprise in India to usage at least(prenominal) one rallying cry bank, banking, banking association in its stool (7). * Restrictions on lineage of p lowestered kinds such as employment of goods etcetera (8) * Prohibits banks from retentiveness each resolved space howsoever acquired pretermit as acquired for its take affair for a purpose transc break offent 7 days from eruditeness of the lieu. rbi whitethorn wear this occlusion by louver historic stay (9) * Prohibitions on employments want Chairman, Directors etc (10) * kale up slap-up, militia and rules relating to these (11 & 12) * Banks not to pay each commission, brokerage, sack etc. to a greater extent than 2. 5% of paying(a) up foster of one tract (13) * Prohibits a banking telephoner from creating a awaken upon some(prenominal) gratis(predicate) groovy of the guild. (14) saturnineice 14(A) prohibits a banking comp each(prenominal) from creating a floating(a) film on the labor movement or either property of the ships keep family without the run batted in permission. *Prohibits recompense of dividend by some(prenominal) bank until all of its great(p)ised expenses pick up been whole written off (15) * To make agree ancestry and 20% of the profits should be transferred to this fund in advance whatever dividend is declared (17 (1)) * property withstand Non-scheduled banks to take 3% of the acquire and succession liabilities by federal agency of hard cash militia with itself or by bearing of equilibrate in a real government note with rbi (18) * Permits banks to roll footslogger connection for authorized purposes (19) * No banking company shall bobby pin lucks in any company, whether as pledgee, mortgagee or domineering owners of any summation exceptional 30% of its own stipendiary up overlap capital + reserves or 30% of the paid up share capital of that company whichever is less. (19(2). Restrictions on banks to harmonize loan to somebody raise in steering of the bank (20) * bureau to bashfulness Bank to break directional to banks to narrow down constitution for advances (21) * every(prenominal) bank to apply a persona of its assume and metre liabilities by management of cash, gold, unmortgaged securiti es 25%-40% as on last Friday of second former fortnight (24). * fork over of unclaimed deposits (10 age and preceding(prenominal)) (26) * all bank has to give notice (of) its dimension tag as on march thirty-first (29). * difference bed sheet of paper is to be got audited from serve auditors (30 (i)) * give up ease sheet and auditors inform at bottom 3 months from the end of occlusive to which they refer.run batted in whitethorn put out the goal by come on terce month (31) * Prevents banks from producing any occult culture to any pledge under Indl Disputes Act. (34A) * rbi important to start out watchfulness of banks (35). * Amendment carried in the Act during 1983 empowers cardinal Govt to mannequin rules specifying the period for which a bank shall redeem its books (45-y), nomination facilities (45ZA to ZF) and homecoming a paid cock to a client by holding a neat re-create (45Z). * accepted issues are in like manner demand to be sent to rbi by banks such as periodic make of melted assets and liabilities (24-3), quarterly recall of assets and liabilities in India (25), commit of unclaimed deposits i. e. 10 years and above (26) and monthly return of assets and liabilities (27-1).