Divestment of NABARD and NHB by RBI

Why is it in the news?
  • The Reserve Bank of India (RBI) divested its entire stake in NABARD and National Housing Bank (NHB) for ₹20 crore and Rs. 1,450 crore, respectively.
More in the news
    • RBI had 100% shareholding in NHB.
    • The divestment in Nabard was done in two phases:
      (1) RBI held 72.5% of equity in Nabard amounting to ₹1,450 crore, of which 71.5% amounting to ₹1,430 crore was divested in October 2010.
      (2) The residual shareholding was divested on 26 February 2019.
      • RBI's divestment in NABARD and National Housing Bank was based on the recommendations of the Narasimham Committee-II
      • NABARD:
        (1) National Bank for Agriculture and Rural Development (NABARD) is an apex development financial institution in India.
        (2) It promotes the financial inclusion in the country.
        (3) The Bank has been entrusted with matters concerning policy, planning and operations in the field of credit for agriculture and other economic activities in rural areas in India.
        (4) It is headquartered at Mumbai with regional offices all over India.
        • NHB:
          (1) National Housing Bank (NHB) has been established with an objective to operate as a principal agency to promote housing finance institutions both at local and regional levels.
          (2) It provides financial and other support incidental to such institutions and for matters connected therewith.
          (3) It also publishes the RESIDEX Index.
        Source
        The Hindu.




        Posted by Jawwad Kazi on 25th Apr 2019
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