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The Primary Reserve Requirement - All licensed bank and non-bank financial institutions are required to hold a certain percentage of their prescribed liabilities at the Central Bank on a non-remunerated basis. The Central Bank can vary this percentage periodically in order to influence credit and monetary conditions. Currently, the statutory primary reserve requirement is17 per cent.
The Secondary Reserve Requirement From time to time, the Central Bank may also request licensed bank and non-bank financial institutions to hold a certain percentage of their prescribed liabilities in a secondary reserve, usually on a remunerated basis. Currently, the statutory secondary reserve requirement is 2 per cent.
The Special Liquidity Facility In addition to the primary and secondary reserves requirement, the Central Bank has from time to time, requested that commercial banks deposit some proportion of their prescribed liabilities in an interest- bearing facility at the Central Bank for an agreed timeframe.