Repo is a form of short term borrowing for dealers in government securities. It is used in resolving any short term cash shortages during period of economic instability or from any other form of stress caused by forces beyond their control. It is a tool used in monetary policy that allows banks to borrow money through repurchase agreements. Liquidity Adjustment Facility- Repo and Reverse Repo rates. The bank�s revenue is basically derived from the interest it earns from the loans it gives out as well as from the fixed income investments. The Second part of regulatory requirement is to invest in G-Securities, which is called as statutory liquidity ratio (SLR). Banks have to maintain certain percentage of deposit with Reserve bank of India (RBI) as CRR (Cash Reserve Ratio) on which they earn lower interest. The Government of India permits foreign banks to operate through branches a wholly owned subsidiary or a subsidiary with aggregate foreign investment of up to 74% in a private bank. This resulted in the introduction of nine private sector banks. In July 1993, as part of the banking reform process and as a measure to induce competition in the banking sector, RBI permitted entry by the private sector into the banking system. After bank nationalization was completed in 19, the majority of Indian banks were public sector banks. There are 28 public sector banks in India. Public sector banks make up the largest category of banks in the Indian banking system. Banks can be broadly categorized into commercial banks, public sector banks, regional rural banks, private sector banks, foreign banks, co-operative banks, and term lending institutions, non-banking finance companies / housing finance companies. RBI manages the country�s money supply and foreign exchange and also serves as a bank for the Government of India and for the country�s commercial banks. Reserve Bank of India (RBI) is the central banking and monetary authority in India. Unlocking opportunities in Metal and Mining
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