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?

The RBI allows foreign banks to operate in India through either branch presence or by establishing a Wholly Owned Subsidiary (WOS) with near-national treatment.

Foreign banks must choose one of these modes and adhere to the principle of a single mode of presence.

The initial minimum paid-up voting equity capital for a WOS is ₹5 billion.

The WOS must bring the entire initial capital upfront, funded by free foreign exchange remittance from its parent.

Therefore, statement 1 is not correct.

The composition of the board of directors of a WOS must meet specific requirements:

a) At least 51% of the board members must meet the criteria defined under Section 10A of the Banking Regulation Act, 1949.

b) At least two-thirds of the directors should be non-executive directors.

c) At least one-third of the directors should be independent of the management of the subsidiary in India, its parent, and any subsidiary or associate of the foreign bank parent.

d) At least 50% of the directors should be Indian nationals/NRIs/PIOs, with the condition that one-third of the directors are Indian nationals resident in India.

Therefore, statement 2 is correct.

Hence, only statement 2 is correct.