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Consider the below statements regarding the evolution of Banking in India Post-independence: A) RBI was nationalized in 1949. B) Nationalization of 14 banks in 1969 was the last time banks were nationalized post-independence. C) Narshimham Committee in 1991 recommended the nationalization of banking for supporting credit growth of the economy to come out of the economic crisis. D) Indhradhanush Plan was aimed at the merger of loss-making banks with bigger banks. Which of the above statements are true?

Consider the below statements regarding the evolution of Banking in India Post-independence: A) RBI was nationalized in 1949. B) Nationalization of 14 banks in 1969 was the last time banks were nationalized post-independence. C) Narshimham Committee in 1991 recommended the nationalization of banking for supporting credit growth of the economy to come out of the economic crisis. D) Indhradhanush Plan was aimed at the merger of loss-making banks with bigger banks. Which of the above statements are true? Correct Answer A only

The correct answer is RBI was nationalized in 1949.

Key Points

  • RBI is the Central bank of India responsible for the regulation of banks and monetary policy. It came into existence in 1935 as per the Reserve Bank of India Act, 1934. Soon, independence need was felt for the nationalization of banks, and the Banking Regulation Act, 1949 was passed for the nationalization of banks. Separately, RBI was nationalized in 1949 for better management of credit flow in the economy.
  • The nationalization of 14 banks took place in 1969. But, it was not the last time as 6 more banks were nationalized in 1980 taking the number to 20. these 6 were 
    Andhra Bank, Corporation Bank, New Bank of India, Oriental Bank of Commerce, Punjab & Sind Bank, and Vijaya Bank.
  • Narshimham's committee in 1991 on Banking reforms didn't recommend the nationalization of banks. Rather it supported opening up of private sector banks and merging or disinvesting loss-making banks.
  • Indradhanush Plan was launched in 2015 for improving functioning in Public Sector Reforms through reforms in the appointment, governance reforms, Bank Board Bureau for an appointment, De-stressing banks, Framework of accountability and Empowering banks in hiring processes.

Related Questions

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Which of the following statements are true in context of scheduled banks?
1. All banks which are included in the Second Schedule to the Reserve Bank of India Act, 1934 are Scheduled Banks.
2. These banks comprise Scheduled Commercial Banks and Scheduled Co-operative Banks.
3. Scheduled Commercial Banks in India are categorized into five different groups - SBI, Nationalised Banks, Regional Rural Banks, Foreign Banks and Other Indian Scheduled Commercial Banks in the private sector.
4. Scheduled Co-operative Banks consist of Scheduled State Co-operative Banks and Scheduled Urban Co-operative Banks.
Defining green banking is relatively easy. It means promoting environment -friendly practices and reducing your carbon footprint from your banking activities. This comes in many forms : using online banking instead of branch banking; paying bills online, opening up CDs (certificates of deposit) and money market accounts at online banks instead of large multi-branch banks. A green bank takes the biggest steps to support local green initiatives. Any combination of the above personal banking practices can help the environment. In this respect, online banks and smaller community banks have better track records than larger banks .However, these larger banks may be induced to go green . According to the passage, larger, multi -branch banks .
Which of the following statements are true in context of Development Financial Institutions (DFls) in few years after economic reforms in 1991?
1. DFls such ICICI, IDBI and IFCI had a huge pile of bad loans.
2. DFls no longer had access to low-cost long-term funds from the government or the central bank to finance large infrastructure projects. They were forced to borrow at higher rates from the market.
3. Banks began financing infrastructure projects, that was actually out of their mandate.
4. RBI established a committee under S. H. Khan for transition of DFIs into universal banks.
5. ICICI Bank and IDBI went for reverse merger in a quest to create Universal Banks.
The global financial crisis in 2008 is considered to be the most serious worldwide financial crisis, which started with the sub-prime lending crisis in USA in 2007. The sub-prime lending crisis led to the banking crisis in 2008 with the collapse of Lehman Brothers in 2008. The sub-prime lending refers to the provision of loans to those borrowers who may have difficulties in repaying loans, and it arises because of excess liquidity following the East Asian crisis. Which one of the following sequences shows the correct precedence as per the given passage?
A few steps of crisis communications are given below
1. Assess the crisis situation
2. Identify your crisis communications team
3. Anticipate crisis
4. Crisis response
Which of the above given is/are steps of pre-crisis communications?
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Which of the following statements are true/ false?
1. In the market economy, the prices are determined by the level of demand and supply in the market.
2. Mixed economy is an economic system in which both the private and public sector have equal roles to play.
3. Planned economy is also known as a centralised economy, controlled economy or command economy.
4. In the market economy, governments do not have much role to play.
In the following question, sentences of a paragraph have been jumbled and labelled as A, B, C and D. You are required to rearrange the jumbled sentences of the paragraph and mark your response accordingly by selecting the correct option. A: RBI regulates commercial banks and non-banking finance companies working in India. B: RBI plays an important part in the Development Strategy of the Government of India. C: The Reserve Bank of India (RBI) is India's central bank, which controls the issue and supply of the Indian rupee.  D: RBI is the regulator of the entire Banking in India.