RBI dividend may drop next year

Central bank may done away with provisioning requirements, to enable higher transfer of surplus in the 2017-18 fiscal, analysts say

The Reserve Bank of India (RBI) may have changed its valuation methodology for its foreign exchange gains generated through interventions, as well as done away with provisioning requirements, to enable higher transfer of surplus in the 2017-18 fiscal, analysts say. 

The methodology change has been long time coming, but could have been completed this year. The Malegam committee on the RBI’s capital adequacy had suggested that the RBI must move away from its methodology to calculate the foreign exchange gains to a weighted average cost-based valuation method. Analysts contend that this may have benefitted the RBI by at least Rs