RBI 03-04 Gross Income Down 38%

Mumbai, Aug 30 | Updated: Aug 31 2004, 05:30am hrs
Gross income of the Reserve Bank of India (RBI) for the year 2003-04 fell by 38.2 per cent to Rs 14,323.7 crore as compared to Rs 23,185.64 crore in the previous year. There was a decline in income from both domestic and foreign sources.

The banks earnings from the deployment of foreign currency assets and gold was down by by 7.3 per cent to Rs 9,103.5 crore in 2003-04 from Rs 9,826.7 crore in 2002-03. This was mainly on account of lower money market interest rates in major countries, on the one hand, and a fall in prices of securities due to rise in longer term yields, on the other, RBI said in its annual report for 2003-04.

Domestic income decreased by 60.9 per cent to Rs 5,220.2 crore in 2003-04 from Rs 13,358.99 crore in 2002-03. This decline in income was mainly due to reduction in profit from sale of rupee securities under open market operations and booking of substantially higher depreciation in the value of rupee securities, substantial rise in cost of monetary operations under the liquidity adjustment facility, reduction in interest income due to decline in the size of the portfolio and investment of Government of India surplus balances in rupee securities held by the RBI.

The composition of RBIs assets also undergone a change in 2003-04. Foreign currency assets rose by 43.7 per cent to Rs 5,24,865 crore (Rs 3,65,000 crore), mainly on account of net purchases of dollars from the market, interest and discount received and revaluation gains. Investment in

government of India rupee securities declined by 61.8 per cent to Rs 40,179.74 crore as on June 30, 2004 (Rs 1,05,144 crore).