The appreciation of the rupee during the whole of financial year 2006-07 and also in the current year upto June 2007 has not just hit the India Inc but also the Reserve Bank of India (RBI), whose balance in the currency and gold revaluation account (CGRA) depleted by Rs 65,065.66 crore to Rs 21,723.52 crore as on June 30, 2007 from Rs 86,789.18 crore at the end of June 30, 2006.
The decrease happened as the central bank saw increasing volumes of foreign currency that had to be revalued at lower rates.The foreign currency assets held by RBI increased to Rs 8,39,878.79 crore as on June 30, 2007, as against Rs 7,18,701.18 crore for the same period a year ago.
However, the central bank returned strong operational numbers. According to the RBI annual report for 2006-07, the surplus amount transferable to the government of India stood at Rs 45,719.60 crore that includes Rs 34,308.60 crore profit on account of transfer of RBI?s stake in State Bank of India to the GoI. The surplus also includes Rs 1914 crore towards interest differential on special securities converted into marketable securities, intended to compensate the government for the difference in interest expenditure which the government had to bear consequent to the conversion of special securities.
The gross income of the RBI for the year 2006-07 was Rs 75,348.33 crore. The gross income (excluding profit on sale of SBN shares) was Rs 41,039.73 crore, registering an increase of 55.9% over the previous year. This was mainly on account of increase in income from foreign sources. Income from domestic sources (excluding profit on sale of SBN shares) also increased during the year, the annual report said.
As far as composition of income of RBI is concerned, its income from foreign sources has further increased. The central bank earnings from the deployment of foreign currency assets and gold increased by Rs 10,614.96 crore ( 43.3%) to Rs 35,152.99 crore in 2006-07 from Rs 24,538.03 crore in 2005-06. This was mainly on account of increase in the level of foreign currency assets and hardening of global short-term interest rates, the report said. Domestic income (excluding the profit on sale of SBN shares) for the year 2006-07 increased to Rs 5,886.74 crore as against Rs 1,782.28 crore in the previous year.
The increase in domestic income was mainly on account of lower provisioning for depreciation on securities held in the bank?s portfolio.
