What is the role of Central Board of Directors of RBI?

• The Union government has nominated Sanjay Lohiya, Secretary, Department of Financial Services, as a director on the Central Board of Reserve Bank of India. 

• He will replace former DFS Secretary Nagaraju Maddirala, who retired in May.

Central Board of RBI

• The Reserve Bank of India was established on April 1, 1935 in accordance with the provisions of the Reserve Bank of India Act, 1934.

• The Central Board of Directors is entrusted with the governance of the Reserve Bank in accordance with the Reserve Bank of India (RBI) Act, 1934. 

• It comprises the Governor as the chairperson, four Deputy Governors and directors nominated by the central government.

• In accordance with the RBI Act, the central government also appoints members for four Local Boards to advise the Central Board on matters referred to them by the Board.

• The directors are generally appointed for a four-year term.

The Central Board is assisted by three Committees: 

i) The Committee of the Central Board (CCB).

ii) The Board for Financial Supervision (BFS).

iii) The Board for Regulation and Supervision of Payment and Settlement Systems (BPSS). 

• These committees are headed by the Governor.

In addition, the Central Board has five sub-committees each headed by a non-official director. 

They are:

i) The Audit and Risk Management Sub-Committee (ARMS).

ii) The Human Resource Management Sub-Committee (HRM-SC).

iii) The Building Sub-Committee (B-SC).

iv) The Information Technology Sub-Committee (IT-SC).

v) The Strategy Sub-Committee (S-SC).