CAPITAL REQUIREMENT Sec 11: Requirement as to minimum paid up capital and reserves Coie If it has a place of business in Delhi, Mumbai, Chennai or Kolkata Rs 20 lakhs BANKING REGULATION ACT, 1949 it has does not have place of business in Delhi, Mumbai, Chennai or Kolkata em ee) If it has a place of business in Delhi, Mumbai, Chennai oF Kolkata Rs 15 lakhs. Rs 10 lakhis it has does not have place of business in Delhi, Mumbai, Chennai or Kolkata Rs 5 lakhs Section 12: Requlation of Paid-up capital, subscribed capital and voting rights of shareholders Capital Structure: Authorised Capital; Subscribed Capital: Paid up capital Sec 17: Reserve Fund + Every banking company incorporated in India shall create a reserve fund + Transfer to reserve and surplus: 25 % of net profit after tax, before declaring dividendBANKING REGULATION ACT, 1949 SEC 15: RESTRICTION AS TO DIVIDEND No banking company shall pay any dividend on its shares until all its capitalised expenses have been completely written off Preliminary expenses Share selling commission Brokerage ‘Amount of losses incurred Any other item of expenditure not represented by'tangible assets have been completely paid off, BUSINESS OF BANKING COMPANY . business oF | companBANKING REGULATION ACT, 1949 LICENSING OF BANKS: SEC 22 Every company which ifif@Ads to do banking business and satisfies the criteria laid down, needs to ‘SIN AERESEMIRED before commencing the business. RBI will 88Ula licence only if the company satisfies the GOndiiONS: The Reserve Bank may cancel a licence granted to a banking company if: ()__ ifthe company ceases to carry on banking business in India; or (ii) if atany time, any of the conditions are not fulfilled. If company is dissatisfied, it may apply to the Central Govt for a finalidecision within 30 days of RBI decision RESTRICTION/ OPENING OF NEW BRANCHES: SEC 23 Every banking company should obtain prior pefmissioh from the RBI for + opening AeWeplace of business, either in India or abroad or + changing th@existing place of business, either in India or abroad. FINANCIAL STATEMENT OF A BANK Sec 29: Accounts\and BalanceBheet + The annual accounts and the balance sheet, Auditor report shall be submitted to the RBI within 3 months ftom the end of the financial year to the RBI. (RBI may further extend this time period to 3 months) Sec 30: Audit + Bis PIL shall be audited by a person duly qualified under any law + every banking shall, before appointing re-appointing or removing any auditor or auditors, obtain the paid previous approval of the Reserve Bank.BANKING REGULATION ACT, 1949 RETURNS TO BE SUBMITTED TO RBI All banking companies are required to submit the following returns to RBI in the prescribed form and manner Return of Liquid Assets and Liabilities (Monthly) Return of Assets and Liabilities (Monthly) Return of Assets and Liabilities (Quarterly) Return to Unclaimed deposits Form VIII (SLR) Form A (CRR) Return of Annual Accounts Other Statements