Key highlights from RBI Press Meet: Repo rate cut by 75 bps, CRR by 100 bps and more

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MPC advanced its meeting (earlier it was scheduled on 3rd April). Rate cut of 75 bps to 4.4%. Reverse repo cut by 90 bps bps at 4% – widening the corridor. MPC voted in ratio of 4:2 in favour of rate cut.

Liquidity measures for banks:

  • CRR – CRR is reduced by 100 bps to 3% of NDTL for period of 1 year – Rs. 137000 crore will get released across the banking system.
  • Minimum daily CRR maintenance reduced to 80% from 90% ( for period till June)

These liquidity measure will inject Rs. 374000 crore in the system

Regulatory measures

  • Moratorium on term loans – all lending institutions are allowed to have moratorium of 3 months wrt to term loans
  • Deferment of interest on WCL – deferment of payment for 3 months, accumulated payment will be done after this period.
  • Easing of WCL all these will not lead to any changes in the lending institutions.
  • NSFR – deferring implementation by 6 months.
  • Deferment of CCB of last tranche 0.625% by 6 months.

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