RBI/2006-2007/383
RPCD.RRB.BC.No.87/03.05.34/2006-07 May
8, 2007 The Chairmen
All
Regional Rural Banks/Sponsor Banks Dear
Sir, Valuation of
investment in SLR/Approved Securities by
Regional
Rural Banks (RRBs) Please
refer to our circular RPCD.RRB.BC.No.71/03.05.34/2005-06
dated March 31, 2006 on the above subject. 2.
The matter has been reviewed and it has been decided that the exemption granted
to RRBs up to the financial year 2006-07 from 'mark to market' norms in respect
of their investments in SLR securities be extended by one more year i.e. for the
financial year 2007-08. Accordingly, RRBs will have the freedom to classify their
entire investment portfolio of SLR securities under 'Held to Maturity' for the
financial year 2007-08 with valuation on book value basis and amortisation of
premium, if any, over the remaining life of securities. 3.
To enable us to analyse the impact of moving towards 'mark to market', please
let us know latest by May 31, 2007, the book value and market value of your SLR
investments as on March 31, 2007. 4.
Please acknowledge receipt to the respective Regional Office. Yours
faithfully, (C.S.
Murthy)
Chief General Manager-in-Charge |