RBI Annual Report 2019-20 – Burning Issues – Free PDF Download

• The central bank follows a July-June financial year

• The balance sheet grew about 30% to Rs 53.3 lakh crore in fiscal year 2020, from Rs 41 lakh crore the year before.

• Assets = Liabilities + Owners Equity

Asset side

• The increase on the asset side was due to increase in domestic and foreign investments by 4% and 27.3%, respectively.
• Increase in loans and advances by 8% and increase in gold by 52.9%.
• Foreign currency assets and gold constituted 71.25% of the RBI’s total assets while domestic assets constituted the rest.

Liability side

• On the liability side, the increase was due to increase in notes issued, other liabilities and provisions, and deposits by
• 5 percent, 30.5 percent and 53.7 percent, respectively.

RBI’s income

• The RBI’s income for the year stood at Rs 1.5 lakh crore while expenditure stood at Rs 92,540 crore (inclusive of Rs 73,615 crore towards transfer to a contingency fund).
• The surplus of Rs 57,128 crore was transferred to the central government.

Banks reported more frauds

• The value of frauds (of over Rs 1 lakh) reported by banks more than doubled to Rs 1.85 lakh crore and the number of cases went up by 28%.
• Banks, on an average, took two years to detect fraud after it had occurred.
• Public sector banks accounted for 80% of the reported frauds, most of which were related to loans.

Economy will continue shrinking

• The contraction in economic activity will continue due to the lockdowns imposed by various states.
• “Upticks that became visible in May and June after the lockdown was eased … appear to have lost strength.” Inflation will remain high due to disruption in supply chains.

Consumer confidence

• Consumer confidence was at an all-time low in July and it will take time for Indians to start spending because of the pay cuts, job losses and behavioural restraints.
• While government spending will support the economy during the pandemic,
• It is private consumption that will have to drive any economic recovery once the coronavirus threat eases.

₹2,000 notes

• Not even a single Rs 2,000 currency note was printed in 2019-20.
• The overall supply of banknotes was also lower by 23% than in the previous year due to the disruptions caused by the lockdown.

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