The high-powered committee formed to monitor the domestic liquidity situation under the chairmanship of finance secretary Arun Ramanathan met in Mumbai on Wednesday. The committee met prominent bankers and mutual fund professionals who made a strong case for further measures to ease the overall liquidity position.
?The overall liquidity condition should be improved…the mutual funds industry needs an overall improvement in liquidity,? said AP Kurian, chairman, Association of Mutual Funds in India told the committee. ?We have recommended that the window (by way of 14-day repo at 9% to make available up to Rs 20,000 crore) must be outside the SLR limit of banks,? Kurian said, adding ?this would enable more banks to come forward to offer this facility to mutual funds.?
?We have explained the position of the mutual fund industry to the Committee and it has heard our views,? he said, adding that the mutual funds industry needs an overall liquidity improvement.
Among others present at the meeting were Indian Banks? Association chairman TS Narayanasami, who also heads Bank of India, Union Bank of India CMD MV Nair, ICICI Bank joint managing director Chanda Kochhar, HDFC Bank MD Aditya Puri, IDBI Bank CMD Yogesh Agarwal and UCO Bank chairman S K Goel.
The committee which had its first meeting last Monday will, after a detailed consultation process, advise the government on the course of action to manage the situation emerging out of the direct and indirect impact of the global financial turmoil originated from US sub prime crisis. It will submit its report within a week.
