Economics · Banking Regulations and ANBC
Vidyut Bank, a private-sector bank in India, is preparing to optimize its Adjusted Net Bank Credit (ANBC) for the next fiscal year. The management is analyzing various asset classes, including investments in bonds, deposits under Priority Sector Lending (PSL), and loan write-offs. Which of the following statements is INCORRECT regarding the guidelines issued by the Reserve Bank of India (RBI) for calculating ANBC?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Provisions, accrued interest, and other similar items should not be deducted directly from Net Bank Credit (NBC) to arrive at ANBC, as they are already accounted for under accounting standards.
- 2Outstanding deposits under RIDF and other eligible funds with SIDBI, NABARD, and NHB on account of PSL shortfall are included in the ANBC calculation.
- 3Investments made by banks in non-SLR bonds held under the Held to Maturity (HTM) category are to be included in the ANBC calculation.
- 4Banks are allowed to exclude outstanding advances against incremental FCNR (B)/NRE deposits from the ANBC calculation without any time-bound regulatory exemptions.✓
Correct answer
Banks are allowed to exclude outstanding advances against incremental FCNR (B)/NRE deposits from the ANBC calculation without any time-bound regulatory exemptions.
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