With reference to the rule/rules imposed by the Reserve Bank of India treating foreign banks, consider the following statements:
- There is no minimum capital requirement for wholly owned banking subsidiaries in India.
- For wholly owned banking subsidiaries in India, at least 50% of the board members should be Indian nationals.
Which of the statements given above is/are correct?
(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2
Correct Answer: (b) 2 only
Explanation:
- Statement 1 is incorrect. There is a minimum capital requirement for wholly owned banking subsidiaries in India.
- Statement 2 is correct. RBI regulations require that at least 50% of the board members of wholly owned banking subsidiaries in India should be Indian nationals.
Possible Sources: RBI guidelines and regulations on foreign banks.
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