Multiple choice

Which of the following is correct in the context of holding of share capital in an RRB?

  1. Central Govt. 50%, State Govt. 35% and sponsoring bank 15%

  2. Central Govt. 35%, State Govt. 15% and sponsoring bank 50%

  3. Central Govt. 50%, State Govt. 15% and sponsoring bank 35%

  4. Central Govt. 35%, State Govt. 50% and sponsoring bank 15%
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

In RRBs, 50% share shall be held by the central government, 15% by the concerned state government and 35% by the sponsor bank. The RRB Amendment Act 2014 has allowed RRBs to raise their capital from sources other than the central and state governments and sponsor banks. In such a case, the combined shareholding of the central government and the sponsor bank cannot be less than 51%. Further, if the shareholding of the state government in the RRB is reduced below 15%, the central government would need to consult the concerned state government.

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