Financial Daily from THE HINDU group of publications
Friday, Mar 21, 2003
Financial Daily from THE HINDU group of publications Friday, Mar 21, 2003 |
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Money & Banking
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RBI & Other Central Banks Banks allowed to set up more offshore units Our Bureau
MUMBAI, March 20 THE Reserve Bank of India has said that banks may set up more than one Offshore Banking Unit (OBU) as long as they are not in the same special economic zone (SEZ). Earlier, in its guidelines for the setting up of OBU's in special economic zones, the apex bank had said, that eligible banks would be permitted to establish only one OBU which would carry on wholesale banking operations. OBUs have also been allowed to invest their surplus funds outside India under the investment policy framed for this purpose by the board of directors of the bank concerned. It has also been decided to allow OBUs to accept deposits from individuals subject to observance of "Know Your Customer" guidelines issued by the RBI, said a press release. Banks have sought permission for allowing OBUs in one SEZ to lend to units and developers in other SEZs and for removing the restriction on overseas lending by OBUs. However, the RBI has said, the restrictions in this regard will continue for the present.
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