With reference to the rule/rules imposed by the Reserve Bank of India while treating foreign banks, consider the following statements:

With reference to the rule/rules imposed by the Reserve Bank of India while treating foreign banks, consider the following statements:

1. There is no minimum capital requirement for wholly owned banking subsidiaries in India.
2. 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

Explanation:

Statement 1: Incorrect - The Reserve Bank of India (RBI) has a minimum capital requirement for wholly owned banking subsidiaries (WOS) in India.

Statement 2: Correct - This is a requirement imposed by the RBI on WOS of foreign banks in India

Therefore, option (b) only 2 is correct.