Declaration of dividends by banks

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....by banks would be as under :- 2. Eligibility criteria for declaration of dividend (a) Only those banks, which comply with the following minimum prudential requirements, would be eligible to declare dividends without prior approval of RBI. i. The bank should have: • CRAR of at least 11 % for preceding two completed years and the accounting year for which it proposes to declare dividend. • Net NPA less than 3 %. ii. The bank should comply with the provisions of Sections 15 and 17 of the Banking Regulation Act, 1949. iii. The bank should comply with the prevailing regulations/ guidelines issued by RBI, including creating adequate provisions for impairment of assets and s....

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....th the requirements at 2(a) above but desire to declare dividends higher than that specified in para 2(b) should obtain prior approval of RBI for declaration of such higher dividend. The RBI would consider the requests received from banks on a case-to-case basis. 3. Interim dividend Banks may also declare and pay interim dividends out of the relevant accounting period's profit without prior approval of RBI if they satisfy the minimum criteria prescribed in paragraph 2(a) above, satisfy the other requirements prescribed in paragraph 2(b) above, and the cumulative interim dividend(s) are within the prudential cap on dividend payout ratio (viz. 33.33%) computed for the relevant accounting period. However, declara....