2023 · Q69
The banks are required to maintain a certain ratio between their cash in hand and total assets. This ratio is known as:
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- ACash Reserve Ratio (CRR)
- BStatutory Liquidity Ratio (SLR)
- CCentral Bank Reserve (CBR)
- DStatutory Bank Ratio (SBR)
Explanation
The Statutory Liquidity Ratio is the proportion of a bank's net demand and time liabilities that must be maintained in the form of liquid assets, namely cash in hand, gold and approved government securities. The Cash Reserve Ratio, by contrast, refers only to the cash balance a bank keeps with the RBI. Hence the ratio described is the Statutory Liquidity Ratio.