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Depositors' money in banks totally safe: FM

Source: PTI
October 10, 2008 16:11 IST
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Finance Minister P Chidambaram on Friday said that depositors' savings in banks is completely safe as banks are well-regulated and capitalised.

He also assured the cash-strapped markets that the government will inject more funds into the system within 10-12 days through the supplementary demands for grants which will come up for approval before Parliament later this month.

"In about 10 or 12 days from today when the supplementary is passed (by Parliament), a substantial amount of liquidity will be infused into the market," he said in an interview to private TV channel CNBC TV18.

The Reserve Bank of India is ready to infuse more liquidity, said Chidambaram.

RBI has already announced the decision to cut the mandatory deposits that banks keep with it by 150 basis points to infuse Rs 60,000 crore (Rs 600 billion) into the financial system and also the government cancelled sale of Rs 10,000 crore (Rs 100 billion) bonds to ease liquidity pressure.

These decisions, which were announced in the morning, calmed down the stock market which plunged by 1,000 points in the early trade at Bombay Stock Exchange.

The supplementary demands for grants will be taken up for discussion and passage during Parliament session beginning on October 17.

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