RBI Issues Norms on Dividend Declaration by Banks
On 2nd January, 2024, the Reserve Bank of India (RBI) issued draft norms on declaring bank dividends, laying down eligibility criteria and guidelines on board oversight.
These norms have been reviewed in the light of implementation of Basel III standards, the revision of the prompt corrective action (PCA) framework, and the introduction of differentiated banks.
About the Norms
Eligibility Criteria for Banks
Banks should meet the following prudential requirements to be eligible to declare dividends or remit profits:
- Capital Adequacy: A commercial bank should have a minimum total capital adequacy of 11.5 per cent to be eligible for declaring dividend, while ....
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