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State Bank of India (SBI), the country's largest lender, has reportedly received deposits and exchanges of approximately Rs 14,000 crore in Rs 2,000 currency notes. This occurs in response to the Reserve Bank of India's (RBI) decision to stop distributing high-value denominations.
SBI Chairman Dinesh Kumar Khara disclosed this information during his visit to GIFT City, stating that around Rs 14,000 crore had been deposited in accounts, while Rs 3,000 crore got exchanged through the bank's branch network. In this regard, Khara also mentioned that SBI holds approximately 20 per cent of the market share.
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The International Financial Services Centre (IFSC) established in India, GIFT City, allows financial institutions to undertake international business that is currently handled by offices abroad. It is the first operational greenfield smart city and international financial services hub in India, a project that was marketed as such by the Gujarat government.
On May 19, the RBI unexpectedly announced the withdrawal of Rs 2,000 banknotes from circulation. Highlighting the legal status of the Rs 2,000 notes, Khara assured the public that they remain legal tender and emphasised that adequate time for exchange had been allowed, alleviating any concerns among individuals.
This recent development involving SBI's involvement in depositing and exchanging these notes sheds light on the ongoing impact of the currency withdrawal, providing valuable information about the extent of transactions within the banking system.
He further informed that the National Asset Reconstruction Company Ltd (NARCL), which can receive the high-value stressed accounts during the current fiscal year, had been identified by SBI.
However, he did not disclose the identities of these accounts. Furthermore, Khara expressed his belief that the RBI will maintain its current interest rate "pause" in light of inflation figures, stating that the central bank will carefully assess various data points before making a final decision.
—Kritika Singhal
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