Lending rates : Rate at which lender (holder) lends money to the borrower (issuer). Borrower is called issuer because he issues a collateral security against money borrowed. Now the lending rate wrt bank is called Prime lending rate (PLR).
Prime Lending rate : Prime means priority so PLR for bank is lending money at some rate to its priority customers.
Cash Reserve ratio : Cash reserve means amt of cash commercial bank has to reserve i.e. maintain with RBI. So RBI may increase CRR to drain excessive cash from commercial banks.
REPO rate & Reverse REPO rate: REPO in financial terms means "Repurchase agreement." Now repurchase of what since RBI and commercial banks deal in cash. RBI with respect to any commercial banks stays on the top most hierarchy. So REPO rate is cash from RBI to Commercial bank on which RBI charges some interest. Now we go reverse i.e cash transaction from commercial banks to RBI to which RBI pays some interest known as reverse repo rate since in reverse case RBI borrows money.
Statutory liquid ratio- SLR : Statutory means "Pertaining to" in case of statutory liquid it pertains to something related to liquid savings like Gold, Silver, Precious stones, Stocks etc those securities which can be converted into cash soon precisely called "Cash equivalents." Commercial banks have to maintain some percentage of cash equivalents with central bank (RBI) this is called SLR.
Shall blog few more later.
KHP
ecomaniac
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