The Banking Regulation Act, 1949 prescribes various statutory returns that banking companies must submit to the Reserve Bank of India (RBI), and in some cases to NABARD (for cooperative banks). These returns ensure that the regulator has accurate, timely, and consistent data to monitor the financial health of banks and to safeguard the stability of the banking system.
Broadly, the returns include:
* Monthly and quarterly statements of assets and liabilities.
* Annual audited accounts and balance sheets with auditor’s reports.
*Unclaimed deposit returns for accounts dormant for ten years.
All returns must be furnished in prescribed formats within specific deadlines, with extensions granted only in exceptional cases by the RBI.
Key Returns and Their Requirements
1. Monthly and Quarterly Returns of Assets and Liabilities
* Section 27: Requires every banking company to submit a return of its assets and liabilities in India as of the last Friday of each month (or the preceding working day if it is a holiday). This must be furnished to the RBI before the end of the following month.
* Section 25: Mandates a similar return as of the close of business on the last Friday of each quarter.
These returns enable the RBI to track liquidity, balance sheet structure, and overall solvency.
2. Annual Accounts and Balance Sheets
* Section 29: Banking companies must prepare their annual accounts and balance sheets in the prescribed form, duly audited, and accompanied by the auditor’s report.
* Section 31: Three copies of these documents must be submitted to the RBI within three months of the end of the financial year.
For State Cooperative Banks and Central Cooperative Banks, these documents must also be submitted to NABARD.
3. Unclaimed Deposits Return
* Section 26: Requires every banking company to file a return in Form IX with the RBI within 30 days after the close of each calendar year.
* This return lists all accounts in India that have remained inoperative for ten years or more, allowing regulators to monitor dormant funds.
💡 Practical Example:
Suppose a savings account has not been operated upon since 2014. By the end of 2024, it becomes dormant for ten years. The bank is required to include this account in its Unclaimed Deposits Return filed with the RBI. Later, as per RBI directions, such unclaimed amounts are transferred to the Depositor Education and Awareness (DEA) Fund. Even after the transfer, the customer (or their legal heirs) can approach the bank to claim the money, ensuring depositor protection while maintaining transparency in unclaimed funds.
Key Aspects of Returns under the Act
* Recipient: Primarily the RBI; in the case of cooperative banks, also NABARD.
* Frequency: Monthly, quarterly, or annual, depending on the type of return.
* Timeframes: Strict statutory deadlines—typically within one month or three months of the reporting date. Extensions may be allowed at RBI’s discretion.
* Purpose: To provide vital information for regulatory oversight, financial stability monitoring, and assessment of compliance with banking laws.
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