One transaction per PIN entry at ATM

Next time you go to an auto mated teller machine (ATM), of any bank, be ready to reenter your personal identification number (PIN) afresh for every transaction you wish to conduct, such as money withdrawal, balance enquiry and checking account details. In order to check misuse of ATM cards by unauthorized people, the Reserve Bank of India (RBI) has asked banks to allow only one transaction at ATM machines for one entry of PIN, which acts like a password for ATM transactions). Previously, customers were allowed to conduct multiple transactions through the ATM by punching in their PIN only once in a single session.

RBI may raise rates by 25 bps in Jan: Poll

The Reserve Bank of India (RBI) is expected to raise key rates by at least 25 basis points (bps) this month to tackle rising inflationary pressures. Analysts expect a total rise of 75 bps in 2011. As food and fuel prices push up inflation, median forecasts for January have been upwardly revised by 25 bps since the last poll in mid-December.  Of 17 economists surveyed, 12 expect RBI to increase rates by 25 bps in January, while one expects a 50 bps increase. The other four expect RBI to keep rates steady in January. RBI’s next policy review is on January 25. Currently at 6.25 per cent, RBI’s key lending rate or repo rate is seen at 6.5 per cent by January-end and seven per cent by year-end. The reverse repo or borrowing rate, which stands at 5.25 per cent, is seen at 5.5 per cent by January-end and six per cent by year-end.

NHB to start mortgage guarantee company by June

The National Housing Bank (NHB) will roll out its mortgage guarantee company by June this year. The firm is being set up to compensate banks and housing finance companies (HFCs) in case of defaults by home loan borrowers. For technical assistance, NHB has roped in a US-based mortgage guarantee firm as its fourth partner. The other two partners are the Asian Development Bank (ADB) and International Finance Corporation (IFC), both having a 10 per cent stake in the company. Declining to give out the name, NHB Chairman R V Verma said the international partner would provide the technical expertise required to run the proposed company. “They (the US-based company) are an experienced international player in mortgage guarantee business and also our strategic partner,” said Verma.

Keep hiking rates to cool inflation: IMF

The International Monetary Fund (IMF) says the Reserve Bank of India (RBI) should maintain a tight monetary policy stance and keep raising interest rates to tame inflation, which it sees as the key macroeconomic challenge. In its annual advisory to the Indian government, IMF has projected inflation at 6.5% by the end of this fiscal year, one percentage point higher than RBI’s own forecast, although the central bank has conceded that the rate could exceed its projection.

Rajnikant Patel appointed director of ICEX

Rajnikant Patel is back in the limelight. He has been appointed whole-time director at commodity futures exchange ICEX, in which his parent company, Reliance Capital, has assumed the role of anchor investor after acquiring the 26 per cent stake of original promoter India Bulls Financial Services. Patel spent the early years of his career with Reserve Bank of India. He joined Bombay Stock Exchange as executive director and was asked to demutualise and corporatise Asia’s oldest bourse. To his credit, BSE attracted good investors, including Frankfurt’s Deutsche Börse and Singapore’s SGX, who hold 5 per cent each. BSE, which was known as a brokers’ cartel, has cut them down to size. Brokers together hold less than 49 per cent now.

Citi effect: CVC may snoop more

The Central Vigilance Commission (CVC) is likely to increase its snooping on public sector banks in the wake of the R300-crore fraud in Citibank’s Gurgaon branch and the housing loan scam involving LIC Housing Finance that came to light last month. Both incidents have caused serious embarrassment to the country’s banking industry, which was largely congratulating itself on its prudence after it withstood the brunt of the global financial crisis. Sources in state-owned banks said Central vigilance officers (CVOs) are likely to monitor high value bank transactions to ensure that incidents of fraud are reduced. Transactions involving more than R1 million are currently considered as high value.

Corporation Bank Bags SKOCH Financial Inclusion Award 2011

Corporation Bank has bagged SKOCH Financial Inclusion Award 2011 - "Inclusion Champion of the Year" instituted by SKOCH Consultancy Services Pvt. Ltd. Shri Ramnath Pradeep, Chairman & Managing Director of the Bank received the Award from Dr. K C Chakrabarty, Deputy Governor, Reserve Bank of India in the presence of Dr. C Rangarajan, Chairman, Economic Advisory Council to the Prime Minister of India at an Award Function held in New Delhi, today.  Corporation Bank has received this Award for completion of its financial inclusion outreach at all the villages having population of above 2000 allotted to the Bank by various State Level Bankers’ Committees (SLBC) in December 2010 way ahead of the given deadline of March 2012. Corporation Bank was allotted 333 villages. Out of total of 333 villages allotted to the Bank, the Bank has branches in 14 villages and in other 319 locations the Bank has established Grameen Vikas Kendras (Branchless Banking Units). SKOCH Consultancy Services has instituted several of the oldest, most prestigious independent civilian awards in the field of financial inclusion, economy, industry, governance, capacity building, empowerment, inclusive growth, citizen services delivery, technology, academics and change management. Skoch Awards identify and salute best practices and comprehensively document, publish and put in public domain for the knowledge of others. The Awardees are selected by an eminent Jury of industry leaders, domain experts, economists and academicians. The Bank has been consistently receiving awards from organizations of repute like IDRBT, IBA, SKOCH etc. on various facets of implementation of technology, customer relationship management etc., over the last many years.

RBI modifies guidelines for core investment companies

The Reserve Bank of India (RBI) has modified the definitions in the guidelines to core investment companies that it considers as systemically important. In its directive issued in August 2010, RBI had advised all systemically important CICs to get a certificate of registration within a period of six months from the date of the notification. It has now further advised such CICs that the term "adjusted net worth" in the guidelines meant the aggregate, as appearing in the last audited balance sheet as at the end of the financial year, of owned funds as defined in non-banking financial (non-deposit accepting or holding) companies prudential norms issued in 2007. These should include 50 per cent of the unrealised appreciation in the book value of quoted investments as at the date of the last audited balance sheet as also at the end of the financial year, which are in excess of the aggregate market value of such investments over the book value of such investments and the increase, if any, in the equity share capital since the date of the last audited balance sheet. It may also include any decline or diminution in the aggregate book value of quoted investments (such diminution being calculated as the excess of the book value of such investments over the aggregate market value of such investments) and the reduction, if any, in the equity share capital since the date of the last audited balance sheet. Investments should include investment in shares, stocks, bonds, debentures or securities issued by the government or local authority or other marketable securities of a like nature.