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Wednesday, November 30, 2011
Catholic Syrian Bank adopts 91 Eco Clubs
Karnataka Chief Secretary wants banks' panel to be more effective
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Satisfactory performance : (From left) Mr S.V. Ranganath, Chief Secretary, Government of Karnataka, Mr Basanth Seth, Chairman, SLBC and CMD, Syndicate Bank; and Ms Uma Shankar, Regional Director, RBI, at the State Level Bankers’ Committee meeting at Vidhanasoudha in Bangalore on Tuesday |
Bangalore, Nov. 29: The Karnataka Chief Secretary, Mr S.V. Ranganath, has called for strengthening the State-Level Bankers' Committee (SLBC) to be more effective in delivering services to both the Government and the public. Addressing the SLBC meet, Mr Ranganath said, “SLBC should regularly monitor various sub-committees and report the out comes to the Chief Secretary or Development Commissioner.” “When this reporting is done to the Chief Secretary or Development Commissioner on a regular basis, automatically attendance in all sub-committees will improve and the outcome is better,” he added. The SLBC should be more active and it is the duty of the convenor to report non-performance of sub-committees for effective monitoring before the quarter meetings. The main reason for strengthening SLBC is due to steep fall in vital parameters such as CD ratio, lending to agriculture sector and to Scheduled Castes/Scheduled Tribes in the State. “When States like Tamil Nadu and Andhra Pradesh have achieved 100 per cent in CD ratio, then why the State lagging behind is and the main reason is lack of monitoring by respective sub-committee,” he pointed out. Mr Basant Seth, Chairman and Managing Director, Syndicate Bank and Chairman- SLBC, in his address said the progress made under FI is in tune with the SLBC for the current fiscal, ie, FI and credit flow to agriculture, a focused attention needs to be given to these two areas and the set goal need to be achieved positively. As of October, banking services have been provided to 2,639 villages out of 3,395 unbanked villages identified, in the population group of over 2,000, thereby, accounting for 78 per cent achievement. “The performance by and large has been satisfactory. However, there is a need to hasten the pace so that the remaining 756 villages are covered by March 2012,” he added. He also said that five regional rural banks (RRBs) are yet to cover 330 villages out of uncovered villages and reiterated the sponsor banks to handhold them to accomplish the task. While reviewing the performance of banks in the State as on September 2011, Mr Seth informed that the aggregate deposits stood at Rs 3,58,474 crore while aggregate advances was Rs 2,66,315 crore with a credit deposit Ratio of 74.29 per cent. The advances to priority sector stood at Rs 1,12,346 crore, constituting 42.19 per cent of credit, surpassing the RBI stipulation of 40 per cent. Similarly, the advance to agriculture sector was Rs 49,233 crore comprising 18.49 per cent of the total credit, which is above the stipulated level of 18 per cent. Advances to the MSME sector stood at Rs 43,945 crore. More than five lakh new farmers have been assisted by lending to the tune of Rs 3,781 crore. Under secondary and tertiary sectors, disbursement was to the tune of Rs 5,283 crore and Rs 6,619 crore respectively.
HBL
Maharashtra tops fake note haul with 85% of total seizure
... Government on Tuesday informed the Lok Sabha that the Reserve Bank of India (RBI) and state police had recovered fake Indian currency notes (FICN) worth over Rs 81 crore in Maharashtra out of total Rs 96 crore till October.....
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For 6 yrs, govt dragging its feet on law to protect depositors
. Not only gold, but dubious schemes including investments in sheep and land had also been rolled out by companies. To curb such activities, the Reserve Bank of India Act was amended and DNBS was created. The department was entrusted with the responsibility of conducting meetings with state governments and authorities and urging them to bring an act in their respective states.....
Customer service at banks—a step forward -
..there is a need to standardise certain critical systems and procedures to ensure a paradigm shift in the way in which banks function today by harnessing technology to the maximum extent and the BCSBI can play a pivotal role in achieving this objective...........
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HC stays CIC's order asking RBI to give information about bank
New Delhi: The Delhi High Court on Tuesday stayed an order of Central Information Commission (CIC) asking RBI to provide copies of its inspection reports about a bank to an information seeker under the transparency law. Justice Vipin Sanghi also issued a notice to information seeker Jayantilal Mistry and stayed the operation of CIC's order asking Reserve Bank of India to reveal inspection reports of Makarpura Industrial Estate Cooperative Bank Ltd under the Right to Information Act. The court's order came on a plea of RBI filed against the direction of CIC saying a single bench of the transparency panel cannot disregard the order passed by its full bench. Senior advocate T R Andhyarujina, appearing for RBI, said the CIC order was passed "erroneously" since it was against the decision of its own full bench which had held that RBI was entitled to seek exemption from disclosure of inspection reports under the RTI if it was satisfied that such revelation would adversely affect the economic interests of the nation. He said, "If the wisdom of (Information) Commissioner finds the finding of the full bench was wrong, he should have referred the matter to the full bench." Seeking setting aside of the order, he said the CIC's order has widespread ramifications for the banking system and that it was also against the interests of cooperative bank concerned. He submitted the disclosure of inspection reports of RBI as part of its statutory duty would lessen faith of public in the banks and the banking system. Mistry had sought copies of inspection reports of last 20 years of the co-operative bank. The information seeker had also sought the names of persons who had inspected the records and details of action, if any, taken against it. Justice Sanghi, however, questioned RBI's counsel asto "why should the citizen not know that whether a bank they are banking with was in a healthy or unhealthy (state)." Andhyarujina responded by saying it was considered by the full bench of CIC while holding that RBI could claim exemption from disclosure of inspection reports. The information sought by Mistry was denied by the CPIO. However, a single bench of the commission had directed RBI to provide the information sought by the applicant by November 30. The Indian Banks Association had also sought to be heard in the matter, but was asked by the court to file its response. The court listed the matter for further hearing on February 13.
Zee News
Through thick and thin
The report on Annual Financial Inspection (AFI) – the karwa sach (bitter truth) note on banks prepared by the Reserve Bank of India – is slimmer by 70 to 75 pages from the previous 100-odd. Here are some reasons, according to a central banker:
* If an AFI report is 100 pages, the bank concerned should not survive.
* In any case, no bank chief takes it seriously and rarely reads it fully, so it is better to save costs by printing fewer pages.
The buzz is that bankers are no longer taking the slimmed-down 25 to 30 page report as casually as they did its thicker predecessor.
BS
Is RBI to blame for microfinance industry’s woes?
...A lack of regulation has only exacerbated the other problems of the $5.3 billion industry, which was once touted as a savior of the “poorest of the poor”.....
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RBI often takes recourse to open mouth operations
.... Central bankers across the globe are renowned for their gobbledegook. So is the RBI. But what made Gokarn tell the world in clear terms that India is on a weak wicket? Was that a deliberate attempt to push down the overvalued Indian rupee, in terms of the real effective exchange rates? Or is it a way to curb demand, where the depreciating rupee makes imports expensive. This is the flip side of the argument.
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Sporadic measures
This refers to the report “Finmin diktat sets stiff targets for PSU banks” (November 28). As an owner, the government’s anxiety to ensure that public sector banks (PSBs) meet its expectations with regard to performance is understandable. But setting up almost uniform levels for achievement under several parameters in which different banks have varying competencies may not bring the desired result. Forcing memorandums of understanding (MoUs) will add pressure on the top management. It may also encourage unethical practices, if one would agree that financial products are different from other consumer products and marketing in the financial sector cannot be compared with buying and selling consumer articles. The finance ministry, at this late stage, should think in terms of (a) encouraging individual banks to do business in areas in which they are better equipped and have a competitive advantage in terms of outreach; (b) redefining the role of various categories of banks considering their background, skills and capabilities; (c) and involving the regulator, the Reserve Bank of India, for conveying the government’s expectations, so that multiplicity of guidance is avoided. Sporadic efforts like the present one will only destabilise the financial sector.
M G Warrier, Mumbai (BS)
Finance Ministry wants to cut banks' IT spend
........With regards to standardisation of IT requirements, bankers said this could make it easier for the banking regulator Reserve Bank of India to supervise banks since they will be able to pull the data from banks' server and also receive it in a common format......
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A crisis is a time to take stock
Moving beyond desperate liberalization, authorities could engage in somber introspection at this inflexion point.....
- Renu Kohli (New Delhi based macroeconomist and former staff member of the International Monetary Fund and the Reserve Bank of India)
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Banks can now open branches in Tier 2 cities without RBI nod
Mumbai: Reserve Bank Tuesday relaxed branch authorisation policy, allowing banks to open administrative office or service branch in cities with population of over 50,000 but less than 1 lakh without its approval. "Now that general permission to banks has been extended for opening of branches in Tier 2 centres, domestic scheduled commercial banks (other than RRBs) will be allowed to open administrative offices and central processing centres (CPCs) or service branches in Tier 2 centre (with population 50,000 to 99,999 as per Census 2001)," the RBI said in a notification. Thus, a bank can open such offices in the Tier II cities without permission from the central bank. The decision was taken as it was observed that branch expansion in Tier 2 centres has not taken place at the desired pace, it said. As per the existing regulation, such relaxation is already available to banks in case they want to expand their presence in Tier 3-6 cities.
Zee News
Cooperative banks in the city safe, now
NAGPUR: Depositors in urban cooperative banks (UCBs) in city may rest assured of the safety of their money - at least for now. After prolonged financial crisis resulted in three cooperative banks in city being shut down causing huge loss to depositors, Reserve Bank of India (RBI) has declared finally there is no cooperative in the city having a negative networth. This means no bank faces a fate similar to Nagpur Mahila, Samata Sahakari and Parmatma Ek Sevak, which have been de-licensed and facing RBI embargo on withdrawals for more than three years. Moreover, this situation is not because the weak banks have been wiped out. It is because banks have over time shown consistent improvement in financial parameters, said a source in apex bank. Negative networth means the banks' losses are more than its owned funds that include share capital and profit reserves. The situation has improved in banks within Nagpur RBI office jurisdiction that covers Vidarbha and Marathwada. There were 22 banks with negative networth in March 2009. The number was halved by March 2011. It came down to eight in October 2011. A couple more are likely to come out of the red soon, said a source. None of the eight banks still in the red is from Nagpur.
TOI
Saraswat Co-op ups savings bank rate to 6%
Urban co-operative banks could be spurred into action as the country's largest co-operative bank, the Saraswat Co-operative Bank, has taken the lead in announcing a hike in savings bank deposit rate from 4 per cent to 6 per cent. The effective annualised interest rate for Saraswat Bank's SB depositors will work out to 6.14 per cent as interest will be credited at quarterly intervals. Irrespective of the deposit amount, the UCB will pay 6 per cent interest on all SB deposits with effect from December 1. The bank may revise the interest rate on SB deposits once in six months. The increase in interest rate on SB deposits by the co-operative bank comes in the wake of Reserve Bank of India's notification (on November 25) allowing UCBs the freedom to set the interest rate on SB deposits. On October 25, the central bank had deregulated savings bank deposit interest rate for all commercial banks. “In the current rising inflation rate environment, bank depositors are getting a raw deal. Hence, we decided to increase the interest rate on SB deposits. Our intention is not to wean away customers from other banks but to give a better deal to our existing customers,” said Mr Eknath K. Thakur, Chairman, Saraswat Co-operative Bank. According to Dr Vinayak Y. Tarale, Secretary, Maharashtra State Co-operative Banks' Association, following the increase in SB deposit rate by Saraswat Bank, other urban co-operative banks may not have much choice but to follow suit.
HBL
Savings account freedom fails to excite most banks
In a month since the Reserve Bank of India (RBI) freed the interest rates on savings bank account, only a few small banks have been able to take advantage of the policy change. Most of the big banks have remained uneffected..........
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Govt launches 10-year NSC; to give 8.7 pc interest
...The decision to raise the maturity period of NSC has been taken on the basis of the recommendations of the Committee for Comprehensive Review of National Small Savings Fund (NSSF), headed by Shyamala Gopinath, the then Deputy Governor of Reserve Bank of India....
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Now, electronic transfer of grants and subsidies
........The implementation of the project was discussed by the Collector at a meeting on Thursday in which Reserve Bank of India (RBI) Assistant General Manager A.J. George, Lead District Manager KN. Subramanian and other senior officials took part.
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Experts see reversal of RBI rate-hike spree
...“If we do see inflation rates coming off as we expect, we could be looking at the peaking of the cycle,” said RBI deputy governor Subir Gokarn last fortnight, referring to the monetary authority’s policy outlook. “Let me emphasise it’s a guidance, not a commitment. There are many risks to that scenario.”.....
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RBI helped rein in inflation: FM
The Centre, on Tuesday, said it has pursued prudent fiscal measures to boost slowing Indian economy, but strongly defended Reserve Bank of India’s monetary stance to tame inflation, saying price rise would have been much higher if the rate hikes were not resorted to. The unfolding euro zone crisis and slowdown in US could be one of the reasons for India’s growth slowing, but economic fundamentals are strong…The government is keeping a close watch on the situation,” Finance Minister Pranab Mukherjee told the Rajya Sabha in a written reply.India’s overall economic growth slowed to 7.7 per cent in the April-June quarter against 8.8 per cent in the same quarter last year. Economic experts have blamed persistent inflation, repeated monetary tightening, together with deceleration in of industrial production as the factors responsible for slower growth in the first quarter. They said the global economic environment, particularly the lingering euro zone crisis, has added uncertainties.The government, however, said that it was the monetary action by the RBI, which has have helped contain inflation and anchor inflationary expectations, although both remain at an elevated level. “In the absence of increase in Repo Rate by RBI, inflation would have been much higher and credit growth would have expanded much faster, thereby fuelling inflation,” Minister of State for Finance Namo Narain Meena said. The government’s defence for RBI has come at a time when the Central bank has almost been isolated in its fight against inflation, which hovered precariously close to 10 per cent, one of the highest among major economies in the world. The RBI, which has raised key short term rates as many as 13 times in the past two years, has been facing stiff opposition from many quarters for its hawkish stance. The India Inc. has criticized the rate hike saying it is unlikely to tame rising inflation and could instead lead to further slowdown in investments and industrial growth. Some of the policymakers too have expressed their reservation towards further tightening of rates when the economy is facing global headwinds.
DH
Tight liquidity limits RBI role in forex market
Market talk suggests that the Reserve Bank of India stepped into the foreign currency market on Monday to check a steep fall of the Indian currency, but it could not prevent it from closing at an all-time low. Executives manning some of the largest treasury operations in India said RBI has been intervening in the currency markets for the last few weeks, something it had refrained from doing for nearly a year when the rupee hovered in the 44-45 range to the greenback. Just like during the height of the global financial crisis in September-October 2008, RBI Governor D.Subbarao has limited ability to dictate how the rupee moves this time too. Whenever RBI asks banks to step in on its behalf, the public sector players supply more dollars into the market, hoping that they would stem a decline. During this exercise, they also buy rupees from the market and end up reducing the supply of the Indian currency. So, with less cash available in the system, there is every possibility that interest rates, even if it is in the short-run, rise. Given that liquidity is tight with banks borrowing over Rs 1.27 lakh crore through RBI's overnight lending window, the central bank would not like to drain more cash from the system. While RBI remained silent on Monday, the government acknowledged that the authorities had limited ability to intervene and stem the rupee's slide. "The rupee cannot slide beyond a point. Ability to intervene (in the forex market) is also limited," economic affairs secretary R Gopalan told reporters.
TOI
RBI to conduct another OMO of R10,000 cr to ease liquidity
...The OMO announcement came after the market trading hours. “Consistent with the stance of the monetary policy and based on the current assessment of prevailing and evolving liquidity conditions, the Reserve Bank of India has decided to conduct open market operations, ” the central bank said in a statement on Tuesday.....
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