RBI dividend to Government of India.

-

 RBI board approved to transfer Rs. 99,122 crores as dividend to Central Government against the estimations of 60,000 crores.


This was the second-highest dividend payout in the last 9 years. This time dividend was declared for a period of 9 months only due to a change of the accounting year.

The primary reasons for the rise in dividend are high forex reserves and Intrest income and changes in accounting practices. As the Central government is the single shareholder in RBI, they need to pay dividends.

Generally, RBI needs to keep a buffer of 5.5% to 6.6%. This time dividend was paid by a risk buffer of 5.5%.

But the fact is dividend is paid by " Printing of money to the extent of dividend payout."

Probably government is the only biggest single shareholder to enjoy all the dividends, without any business. However, this will cover the Fiscal deficit.
Location: India

Comments

Post a Comment

Popular posts from this blog

Lets talk money

-
Image
Started reading again " Let's talk money" by  @monikahalan  which explains money management in the Indian context. "Our money worries usually center around finding the best return on investment. But there is a lot more to Financial fitness than just investments. We need a system and not a single-shot solution. "  We worry about the investment the way we worry about our weight. Instead of dieting or investing being a habit, we only think of them as remedial measures when our weight or our bank balance goes too high or low. Everybody has money to save - from the poor to rich, we just don't know how to look for it.  #savings   #investing When you lend money for a non-emergency situation to a person, you lose money, you lose respect for the other person, and somewhere for yourself for getting into a situation like this. Keeping money ready for an emergency is important. Not only do you not have to worry about the money when you need it, but it also frees up mone
Read more

The Intelligent Investor - Benjamin Graham

-
Image
  By far the best book on investing ever written. - Warren Buffett. To invest successfully over a lifetime does not require a stratospheric IQ, unusual business insights, or inside information. What's needed is a sound intellectual framework for making decisions and the ability to keep emotions from corroding that framework. - Warren Buffett. Graham core principles, which are at least as valid today as they were during his lifetime: A stock is not just a ticker symbol or an electronic blip; it is an ownership interest in an actual business, with an underlying value that does not depend on its share price. The Market is a pendulum that forever swings between unsustainable optimism and unjustified pessimism. The intelligent investor is realistic who sells to optimists and buys from pessimists. The future value of every investment is a function of its present price. The higher the price you pay, the lower your return will be. - No matter, how careful you are, the one risk no inve
Read more