The Reserve Bank of India (RBI) will be transferring Rs 57,128 crore of its surplus to the Union government for the fiscal 2019-20, against Rs 1.76 trillion of transfer it did last year, the central bank said in a statement.

The government had budgeted Rs 60,000 crore as dividend to bridge its fiscal deficit, but government officials had expected more from the RBI. Economists, however, had expected the dividend transfer to be relatively muted this year and the transfer is largely inline with the expectations.

However, as per the economic capital framework (ECF) adopted by the RBI board last year, the contingency risk buffer, or realised equity, has to be maintained at 5.5-6.5 per cent of the balance sheet.

The RBI board decided to maintain the Buffer at 5.5 per cent.

In financial year 2018-19, Rs 1,23,414 crore of its surplus to the central government for the fiscal year 2018-19 or FY19 (July to June), and an additional Rs 52,637 crore of excess provisions as recommended by the Bimal Jalan committee on ECF. The surplus is commonly called ‘dividend’. In 2018-19, the RBI had transferred Rs 65,896 crore, in 2017-18 Rs 50,000 crore, while in 2016-17, the dividend transfer was just Rs 30,659 crore because of demonetisation.

The central bank’s financial year runs from July to June, but from next year, the financial year will get aligned with that of the government and will end in March.

The central bank’s board met on Friday to review RBI’s balance sheet, the surplus transfer is part of that review process.

“The board reviewed the current economic situation, continued global and domestic challenges and the monetary, regulatory and other measures taken by RBI to mitigate the economic impact of COVID-19 pandemic,” the RBI said in its statement. The board also discussed the proposal of setting up an Innovation Hub, as announced on the August 6 monetary policy review.