The very purpose of VITALINFO is to provide a platform for wider dissemination of updated information related to and happening of events in and around RBI.
.... Is there a disconnect between how RBI Governor D. Subbarao and his deputy Subir Gokarn perceive things? For instance, Gokarn gives the impression that the recent cut in CRR is to manage liquidity and there is no change in RBI’s anti-inflation stance, but Subbarao hints at a shift in stance. Similarly, while the governor is ready to wait and watch how the CRR cut—that released Rs.32,000 crore into the financial system—impacts liquidity before resuming RBI’s bond buying programme, Gokarn gives the impression that the central bank will continue to buy bonds to infuse liquidity.
........In essence, the RBI has put the onus on the government. “Strong signs of fiscal consolidation are critical to create the space for lowering the policy rate,” it said in its third quarter review of monetary policy 2011-12. It had even gone a step further. It advised the government to “exploit the forthcoming Union Budget” to “begin this process in a credible and sustainable way.”......
RBI's 50 bps CRR cut a small step towards liberal monetary policy
.... In his first three years at Mint Road in Mumbai, RBI Governor Duvvuri Subbarao had his hands full. He oversaw a series of interest rate cuts while combating crisis after the Lehman Brothers collapsed in September 2008 and the global financial meltdown set in. Subsequently, Subbarao turned the tide of accommodative monetary policy by raising rates to tame inflation.....
.................On the fiscal front, the Reserve Bank has made its message explicitly clear to the Government by saying that “considering the egregious implications of large fiscal deficits, which are well known , there is an urgent need for decisive fiscal consolidation, which will shift the balance of aggregate demand from public to private, and from consumption to capital formation.................
Cyber Society of India (CySI) and Indian Overseas Bank (IOB) jointly organised a National Seminar on Banking on e-Security: RBI's Gopalakrishna Working Group. This Working Group has given recommendations to all the banks in India. Mr G Gopalakrishna, Chairman of the Working Group talks about his report and the recommendations, which has been accepted by RBI for implementation.
Under the Reward & Motivation Scheme of HRMD, Central Office, Shri Mangesh Tarambale was felicitated in recognition and appreciation of exceptional & exemplary service to the Bank and conferred the award for the year 2011-12 at the hands of Dr. Subir Gokarn, Deputy Governor on the occasion of Republic Day Celebrations on January 26, 2012. The key points fetching the award include:-
(i)making constant efforts to motivate the Typists/Stenographers/Private Secretaries and imparting them free shorthand coaching since 1981
(ii)successfully conducting Conference of Private Secretaries for the last five years with a view to upliftment of the cadre
(iii)creating and updating regularly a website dedicated for the PS Fraternity since 2007
(iv)making various suggestions, e.g. use of solar energy, introduction of commission free remittance facility for the staff attached to non-DAD centres of the Bank
(v)modification of existing EPABX telephone system without spending a single rupee for facilitating greater and easier communication which saved the Bank approx. Rs. 50 – 60,000/-
(vi)the project VITALINFO started on November 28, 2010 with the very purpose to provide a platform for wider dissemination of updated information related to and happening of events in and around RBI. VITALINFO which is updated well before 7 a.m. 365 days a year has been widely appreciated by the executives, staff and retirees of RBI besides the senior officers from NABARD, NHB etc.
............We should not confuse the short-term objective of inflation management with the long-term objective of fundamentally addressing supply bottlenecks — whether in transport, power, water or food. We need to spend on these issues, but we need to see where else we can compress expenditure. In that context we have been emphatic on fiscal consolidation, which is to reduce subsidies and expenses contributing to consumption................
.....According to the RBI, the CRR is a policy instrument with liquidity dimension. Its reduction will bring down the cost of money for banks and have a bearing on their ability to lend at lower rates. It may well be so but, for most market participants, a repo rate reduction would be the more authentic signal. Soon after the policy announcement on Tuesday, attention has immediately shifted to how soon the RBI will act in that direction........
It may appear cynical to say the independence of the RBI is a mere fig leaf which is used conveniently to the advantage of the government. While the government nominally claims that the RBI has total independence, in practice the government reins in the RBI. The government expects the RBI to be concerned about the growth of the economy and restrains the RBI from taking corrective measures to prevent unsustainable growth; once unsustainable growth results in inflation, it becomes the primary task of the RBI to control inflation and it is expected to do so without adversely affecting growth -- an impossible juggler's act.
.....What are the signals emanating from RBI's latest monetary policy? It is clear that RBI's policy has shifted from controlling inflation to fostering economic growth. However this shift is only slight as RBI is not entirely sure that inflation fears have completely subsided. It is still worried that inflation will rear its ugly head again. At the same time RBI is signalling that the Govt of India needs to control its expenditure......
SHILLONG: In view of the acute shortage of coins faced by Shillongites, the Reserve Bank of India (RBI) organized a coin Mela at MTC Building, Jail Road on Saturday. The Mela was supervised by Deputy General Manager, RBI, Guwahati Jatin Rawal. The implementing agency is SBI Main Branch. A source from the SBI Main Branch said that the idea behind this Mela is to spread the awareness that there is no shortage of coins in the city. “Today the RBI has taken the initiative in association with SBI and it can be another bank in the next Mela since the issue related to coin is not the sole responsibility of SBI. The Mela was organized for the first time in the city with the sole aim to take out the fear psychosis that is there in the people’s mind regarding the crisis of coin,” said the source requesting anonymity. The source further said that the Mela could have been organized inside the bank premises but the authorities went outside and conducted it in a public place so that they can reach out to the public to distribute the coins. On Saturday, Re1, Rs2, Rs5 and Rs10 coins were distributed to the general public. “It will continue in the near future too and will be implemented by another bank. This maiden Mela was a successful one,” he said. The source also said that with the opening success they would like to see it taking place at least 3/4 times in a year. He also requested the public to rotate the coins and should not deposit them in their piggy banks. Meanwhile, large number of customers thronged the stall which was erected at the parking lot of MTC Headquarters, Jail Road. There were separate queues in place for customers wishing to take certain denomination which was assisted by SBI officials. A pan shop owner said that he has not seen such a Mela in the past where coins were distributed in such large numbers. “I would request the RBI authorities to organize such Mela on a quarterly basis so that there remains no crisis of coins in the city,” he said. Another customer said that she is satisfied with the coin Mela since coin crisis is a major thing in the city. “If you go to any shop you can’t expect any return less than Rs10. This is the sad reality in this city,” she said adding that such Mela will reduce the availability of change in the market. She is also echoed by another customer who said that the coin crisis is more or less created by the business establishment, small or big, and no matter how many such Melas are conducted if the unfair trade practices of these establishments are not checked nothing can be done. “The bank is doing its duty but to me the coin crisis here is a created one as public here doesn’t have any voice,” he said.
.... In what could be a game-changing move, banks may be allowed to hedge their risks in the commodity futures market. According to government sources, the finance ministry has written to the Reserve Bank of India (RBI) to explore ways to allow entry of banks in commodity hedging. RBI is actively considering the matter...........
.... “Chances of RBI hiking interest rates further are remote. Inflation is coming down, so RBI may cut rates. Interest should start declining by April,” .......
मुंबई में इन दिनों धड़ल्ले से चल रहे है नकली सिक्के. यहां के एक व्यापारी संगठन ने अपना सिक्का जारी कर लिया है. आरबीआई को खबर लगी है और अब इसकी जांच के आदेश दे दिए गए हैं................
...........The World Bank will offer financial sector assistance to the Reserve Bank of India (RBI) to help Indian banks to invest in risk mitigation programmes and capitalise as they migrate to Basel III, a global regulatory standard for banks agreed by the Basel Committee on Banking Supervision in 2010-11............
The RBI recently made a small change to how FIIs can trade in the government securities market. The central bank said that an FII holding a particular government bond cannot sell the security more than two times a year. Since withholding tax in India is very high, a large number of FIIs usually sold a G-sec just before the day of interest payment and then bought it back after the payment of interest. Since bond prices incorporate interest payments, FIIs used to make profits using this route but hardly paid any tax. Since the government pays interest on G-secs on a half-yearly basis, by changing the rules of FII trading in the bond market, it expects to see some extra revenue inflows into the exchequer through this route.
The Reserve Bank of India (RBI) is learnt to have turned down the government proposal to restructure textiles sector loans worth Rs 1 lakh crore, mostly from the PSU lenders, stating it would not be "the best international practice". It was the proposal of the Textiles Ministry, which is under the additional charge of Commerce and Industry Minister Anand Sharma, to rework the loans for the industry which has been facing difficult times owing to adverse global scenario and demand slowdown in the domestic market. A moratorium on repayment of loans was also suggested by the ministry, but the central bank did not find it desirable, an official said. The industry has been clamouring for relief from the government on the plea that high interest rates have hit hard the silk, spinning and power-loom units. As per the Confederation of Indian Textile Industry, out of 287 companies listed on the Bombay Stock Exchange, 122 firms had reported net loss in the first quarter of 2011-12.
..."...it is suggested that the deduction in respect of interest on housing loan in case of self occupied property should be increased from Rs 1.5 lakh to Rs 3 lakh", ICAI said in a pre-Budget memorandum to Finance Minister Pranab Mukherjee......
.....Unfortunately the data could potentially be misleading as banks have been mandated by the RBI to provide for Non Performing Assets based on system generated reports! The past errors, attributed conveniently to “human errors” are biting the banks when the situation is already bad! There increase in the NPAs too must be attributed to the macro economic situation where the economy has been experiencing a serious slowdown.This brings the discussion to what this means to the banks. The problem of the NPAs has to be dealt with in from preventive as well as a curative perspective......
