Sale of RBI's stake in NHB and NABARD to GoI.
News In Brief The Reserve Bank of India (RBI) divested its entire stake in National Housing Bank (NHB) and NABARD to the Government. RBI had 100 % stake in NHB which was divested for Rs. 1450 Crore and it also held a 72.5 % stake in NABARD worth Rs. 1450 crore, of which 71.5 % amounting to Rs. 1430 crore were divested already (in 2010) , and the remaining stake of Rs. 20 crores were sold in Feb 2019. With this divestment, now the Government of India holds a 100 % stake in both the financial institutions and acquired full ownership. Why RBI sold its entire stake or Equity? RBI is the regulator and supervisor of the entire monetary system which includes banks and financial institutions. It also held stakes in National Housing Bank (NHB) and NABARD. So, as a stake holder it has to think for business expansion and profit maximization and as a regulator,it has to think for effective regulation of such entities. Thus this will leads to conflicts in p...