With a view to alleviating frictional liquidity pressure, the Reserve Bank of India had announced two liquidity easing measures on October 29, 2010.
As the frictional liquidity pressure may persist and in order to provide liquidity comfort, it has been decided to extend the liquidity easing measures announced on October 29, 2010 on all days during November 1 - 4, 2010. Accordingly,
Scheduled commercial banks may avail of additional liquidity support under the liquidity adjustment facility (LAF) to the extent of up to 1.0 per cent of their net demand and time liabilities (NDTL) as on October 8, 2010. As the LAF auction on November 4, 2010 will be for four days, banks may seek waiver of penal interest for any shortfall in maintenance of statutory liquidity ratio (SLR) arising out of availment of this facility up to November 7, 2010 purely as an ad hoc, temporary measure.
A special second LAF (SLAF) will be conducted at 4.15 p.m. on all days during November 1- 4, 2010.
Chief General Manager
Press Release: 2010-2011/602