law: Banking Regulation Act, 1949
  11. Requirement as to minimum paid-up capital
  
  and reserves
  (1) Notwithstanding anything contained in
  
  [section 149 of the Companies Act, 1956], no banking company in existence on
  
  the commencement of this Act, shall, after the expiry of three years from such
  
  commencement or of such further period not exceeding one year as the Reserve
  
  Bank, having regard to the interests of the depositors of the company, may
  
  think fit in any particular case to allow, carry on business 11[in India], and
  
  no other banking company shall, after the commencement of this Act, commence or
  
  carry on business 11[in India], unless it complies with such of the
  
  requirements of this section as are applicable to it.]
  [(2) In the case of a banking company
  
  incorporated outside India-
  (a) the aggregate
  
  value of its paid-up capital and reserves shall not be less than fifteen lakhs
  
  of rupees and if it has a place or places of business in the city of 
  
   Bombay or Calcutta or both, twenty lakhs
  
  of rupees; and
  (b) [the banking
  
  company shall deposit and keep deposited with the Reserve Bank either in cash
  
  or in the form of unencumbered approved securities, or partly in cash and
  
  partly in the form of such securities-
  (i) an amount which
  
  shall not be less than the minimum required by clause (a); and
  (ii) as soon as may be
  
  after the expiration of each 40[***] year, an amount calculated at twenty per
  
  cent of its profit for that year in respect of all business transacted through
  
  its branches in India, as disclosed in the profit and loss account prepared
  
  with reference to that year under section 29:]
  PROVIDED that any such banking
  
  company may at any time replace-
  (i) any securities so
  
  deposited by cash or by any other unencumbered approved securities or partly by
  
  cash and partly by other such securities, so however, that the total amount
  
  deposited is not affected;
  (ii) any cash so
  
  deposited by unencumbered approved securities of an equal value.]
  [(2A) Notwithstanding anything contained in
  
  sub-section (2), the Central Government may, on the recommendation of the
  
  Reserve Bank, and having regard to the adequacy of the amounts already
  
  deposited and kept deposited by a banking company under sub-section (2), in
  
  relation to its deposit liabilities in India declare by order in writing that
  
  the provisions of sub-clause (ii) of clause (b) of sub-section (2) shall not
  
  apply to such banking company for such period as may be specified in the
  
  order.]
  (3) In the case of any banking company to
  
  which the provisions of sub-section(2) do not apply, the aggregate value of its
  
  paid-up capital and reserves shall not be less than -
  (i) if it has places
  
  of business in more than one State, five lakh of rupees, and if any such place
  
  or places of business is or are situated in the city of Bombay or Calcutta or
  
  both, ten lakhs of rupees;
  (ii) if it has all its
  
  places of business in one State none of which is situated in the city of Bombay
  
  or Calcutta, one lakh of rupees in respect of its principal place of business,
  
  plus ten thousand rupees in respect of each of its other places of business, situated
  
  in the same district in which it has its principal place of business, plus
  
  twenty-five thousand rupees in respect of each place of business situated
  
  elsewhere in the State otherwise than in the same district:
  PROVIDED that no banking
  
  company to which this clause applies shall be required to have paid-up capital
  
  and reserves exceeding an aggregate value of five lakhs of rupees:
  PROVIDED FURTHER that no banking
  
  company to which this clause applies and which has only one place of business,
  
  shall be required to have paid-up capital and reserves exceeding an aggregate
  
  value of fifty thousand rupees:
  [PROVIDED FURTHERthat
  
  in the case of every banking company to which this clause applies and which
  
  commences banking business for the first time after the commencement of the
  
  Banking Companies (Amendment) Act, 1962 (36 of 1962), the value of its paid-up
  
  capital shall not be less than five lakhs of rupees;]
  (iii) if it has all
  
  its places of business in one State, or more of which is or are situated in the
  
  city of  Bombay or  Calcutta , five lakhs of
  
  rupees, plus twenty-five thousand rupees in respect of each place of business
  
  situated outside the city of  Bombay or  Calcutta , as the case may be:
  PROVIDED that no banking
  
  company to which this clause applies shall be required to have paid-up capital
  
  and reserves exceeding an aggregate value of ten lakhs of rupees.
  Explanation: For the purposes of this sub-section,
  
  a place of business situated 42[in a State] other than that in which the
  
  principal place of business of the banking company is situated shall, if it is
  
  not more than twenty-five miles distant from such principal place of business,
  
  be deemed to be situated within the same State as such principal place of
  
  business.
  (4) Any amount deposited and kept deposited
  
  with the Reserve Bank under 43[*subsection (2) by any banking company
  
  incorporated 44[outside India] shall, in the event of the company ceasing for
  
  any reason to carry on banking business 11 [in India], be an asset of the
  
  company on which the claims of all the creditors of the company 11[in India]
  
  shall be a first charge.
  (5) For the purposes of this section-
  (a) "place of
  
  business" means any office, sub-office, sub-pay office and any place of
  
  business at which deposits are received, cheques cashed or moneys lent;
  (b) "value"
  
  means the real or exchangeable value, and not, the nominal value which may be
  
  shown in the books of the banking company concerned.]
  (6) If any dispute arises in computing the
  
  aggregate value of the paid-up capital and reserves of any banking company, a
  
  determination thereof by the Reserve Bank shall be final for the purposes of
  
  this section.