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What is Statutory liquidity ratio and Cash Reserve Ratio?

April 26, 2017Business cash Finance liquidity ratio Reserve statutory

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What is Statutory liquidity ratio and Cash Reserve Ratio?

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Statutory Liquidity Ratio (SLR) is a term used in the regulation of banking in India. It is the amount which a bank has to maintain in the form of cash, gold or approved securities. The quantum is specified as some percentage of the total demand and time liabilities of a bank. This percentage is fixed by the Reserve Bank of India. Cash Reserve Ratio:The reserve requirement (or required reserve ratio) is a bank regulation that sets the minimum reserves each bank must hold to customer deposits and notes. These reserves are designed to satisfy withdrawal demands, and would normally be in the form of fiat currency stored in a bank vault (vault cash), or with a central bank. A detailed article here: http://www.geocities.