DBOD.No. Dir.BC.20/12.02.001/97-98

March 18, 1998

Phalguna 27, 1919 (Saka)

All Scheduled Commercial Banks

Dear Sir,

Penal Rate of Interest on the shortfall in the maintenance of CRR / SLR

Please refer to our circular DBOD No. BC. 6/12.02.001/97-98 dated 16th January 1998 on the captioned subject.

2. In this connection, we invite your attention to Deputy Governor's circular No. MPD. BC. 172/07.01.279/97-98 dated 18th March 1998 in terms of which the Bank Rate has been reduced by one half of one percentage point i.e. from "11.00 percent per annum" to "10.5 percent per annum" with effect from the close of business today (18th March 1998). Consequently, the penal rate of interest charged on the amount of shortfalls in the maintenance of Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR) which is linked to Bank Rate stands revised from the close of business on 18th March 1998.

Yours faithfully

(D.V. Jhaveri)

General Manager