Banker by profession, poetess by passion

यह रिवायत चल पड़ी है आज के इस दौर में

उन को ही ठुकराओ  जिनका आप पर एहसान है

Mrs Elizabeth Kurien, known as "Mona" 

Ex-Manager, Insp. Dept, Central Office

and a member of EXRIBTES Group 

......She can read the pulse of the market with the same ease as the poetry of Ghalib and Faiz. Finance and banking stirs her as much as ‘ghazal’ and ‘nazm’. Yes, she has a head for not just figures but also for the fine arts.......

Read - The Hindu

She can be contacted on ek.mona@yahoo.com

- Thanks to Shri Madan Gauria, Chandigarh for sending this VITALINFO...........
Have you also something to share, contact VITALINFO.....

Strengthen RBI's balance sheet - M.G.Warrier

M.G.Warrier
Former General Manager, Reserve Bank of India

To ensure that temptations of the government emanating from external compulsions do not to dilute the strength of RBI’s balance sheet, the government should take measures to augment the share capital of the RBI after amending the RBI Act....

Read.....

BC model facing resistance: Sa-Dhan

The business correspondents (BCs) model, which was encouraged by the Reserve Bank of India (RBI) to promote financial inclusion in the country, is facing many challenges, according to a study by Sa-Dhan, the national association of community development finance institutions. The study, which focused on financial inclusion models including self-help group-bank linkage, microfinance institutions and BC model, pointed out that the BC model currently required urgent intervention to sustain........

Read - BS

RBI Liquidity position comfortable: Gokarn

....For the last several weeks liquidity levels have been within our comfort zone (but) we monitor this on a daily basis”, Reserve Bank Deputy Governor Subir Gokarn told reporters .......

Read - The Hindu

Lessons in finance

A student at a finance conference organised by the Indian Institute of Foreign Trade asked Goldman Sachs MD Bunty Bohra where the world would be if finance stopped being the prime mover for creating products and making profits. Bohra was clearly taken aback by the question but his answer was simple: “You are asking an investment banker this question? The world would come to an end!” To which a Reserve Bank of India Deputy Governor laconically suggested, “Then you can teach finance.

BS

Gokarn dampens hope for cash reserve ratio cut

Bankers expecting a reduction in the cash reserve ratio (CRR) at the Reserve Bank of India’s (RBI’s) mid-quarter policy review, scheduled on the coming Monday, will be disappointed at Deputy Governor Subir Gokarn’s comment on liquidity..........

Read - BS

Banks must get electric haircut

....which is why there will be a temptation to somehow convince RBI to grant one-time waivers which would allow banks to continue to classify these as standard assets. RBI, sadly, has allowed such waivers in the past. It has allowed banks to continue to classify Air India as a restructured asset instead of as an NPA and, last year, it allowed banks to lower their provision cover ratio as a higher ratio would mean that banks would have to report lower profits—

Read - FE

Bankers & Trust

Regulators and bureaucrats usually give a nuanced response whenever faced with irate customers on the lines of 'we will look into it'. K C Chakrabarty, Deputy Governor, Reserve Bank of India , though , is a contrarian and does not mince his words while tearing into middle-class attitudes . Speaking at an event to commemorate the memory of M R Pai who founded the All India Bank Depositors ' Association at the Indian Merchants Chamber,  Mr Chakrabarty said bank customers should be self-driven as far as financial literacy is concerned . "Banks thrive on asymmetry of information ," he said , pointing out how even in simple products like fixed deposits , banks mislead by advertising high rates on special schemes like 555-day deposits and provide lower returns on longer-term deposits . He blamed middle-class inertia for banks getting away with poor service and questioned their tolerance despite being spoilt for choice. Incidentally , Chakrabarty's words would have rung a bell for those who knew Pai . He was a great believer in the maxim that a well-worded complaint could make a huge difference .

TOI http://timesofindia.indiatimes.com/city/mumbai/City-lights/articleshow/16330876.cms

A primer on cash reserve ratio

BS

Banking on CRR

The cash reserve ratio (CRR) is required to ensure and control liquidity in the banking system. However, it should be used sparingly and as a last resort. Banks earn no interest on the money locked up as CRR. Hence the Reserve Bank of India (RBI) should not be reluctant to share with bankers at least 50 per cent of its potential earnings on CRR balances. It should not be forgotten that it is public money with banks that is being apportioned to be parked as CRR and it is the public that will suffer if banks earn no interest. If banks are allowed to earn interest on CRR, it will encourage them to price their products to the advantage of customers. 

- Vijayasenan P Chennai (BS)

Nothing for banks to gripe about

.....CRR is not a tax but a fee. The banking system benefits from the licence it gets from the central bank to carry on business because it mints money through the working of the multiplier. It is a form of seigniorage enjoyed by the banking system similar to what the government gets through the printing of currency notes. Hence, the question of paying interest on CRR balances does not arise, as the system is amply rewarded by the power to create money......

Read - HBL

Clash of interests

Who will blink first—Chaudhuri batting for the customers or Chakrabarty insisting on banking austerity? 

Apart from inflation, what else does the Reserve Bank of India fear? The central bank, under D. Subbarao, is not too scared of the Central government. But it is worried about the autonomous noises made by India's largest public sector bank. Successive chairmen of State Bank of India have drawn the ire of the banking regulator. ........

Read.......

Forum keen to fund projects in 'Emerging Kerala'

.....Khurshid A Najmi, former legal adviser of RBI, said it was for the RBI to grant license to operate on participatory banking. No changes in banking laws are required for permitting interest free banking, he said. 

Read.......

Also read....... Islamic Forum suggests interest-free banking as solution for state's woes

Club smaller PSBs into a larger bank

..... A plausible escape route could be to redistribute the bulk deposits into smaller accounts—in the past, some banks have done that. Basel III norms, as RBI Governor Subbarao has pointed out, will impose an annual cash set-aside of up to R20,000 crore by the finance ministry to recap all the PSBs. In today’s scenario, this is a huge cheque to write. On the upside, the government can rejig the shareholding of smaller banks at far lower costs for the economy, since they are evidently not doing much of public banking. As some of them are nicely capitalised, merging them with the more stressed large banks can save some of the humongous payout.....

Read - FE

NPCI rolls out inter-bank service for merchant payments

National Payments Corporation of India (NPCI) has launched an inter-bank mobile payment service (IMPS) for merchant payments. This is aimed at making mobile payments to merchants and enterprises easier.......

Read - HBL

AP Mahesh Coop Bank declares dividend

....The Reserve Bank of India had acceded to the request of the bank to extend its area of operation to the entire states of Maharashtra, Rajasthan and Gujarat, .......

Read - HBL

Volume spurts in bond mart as DIIs flock to sovereigns

....Trade volumes remained high even today topping Rs 32,000 crore. This was despite the Reserve Bank of India’s Deputy Governor Subir Gokarn virtually spiking all market speculation of a possible reduction in the key monetary tool, the cash reserve ratio. A reduction would have increased cash in the banking system. But Gokarn said the cash was comfortable in the banking system. The RBI’s stance, traders said stemmed from the low deficit in the banking system of less than one per cent of the aggregate deposits. A cash deficit of one percent is the RBI’s declared comfort zone......

Read.........

MFIN seeks 2 years' time to meet loan cap norms

The Microfinance Institutions Network (MFIN), the representative body of microfinance institutions (MFIs), has sought two years’ time from the Reserve Bank of India (RBI) for meeting the newly-introduced norms on margin cap on loans.........

Read - BS

Fuel fiasco a big letdown for markets

....The RBI has many reasons to ease rates, given that GDP growth is expected to fall sharply from estimated levels of 6.5%, mainly because of lack of credit offtake and below-par monsoons. Incremental Credit Deposit Ratio (ICDR) for 2012-13 till date is just 9.5%, indicating a sluggishness in credit growth.....

Read - DNA

RBI seeks to relax corp bond rules for primary dealers

The Reserve Bank of India (RBI) has proposed allowing standalone primary dealers to act as market makers in corporate bond trading as part of a slew of proposals intended to relax guidelines and increase liquidity in this debt segment. The RBI is also proposing allowing standalone primary dealers to invest up to 50 percent of funds borrowed from call money markets into corporate debt, according to a draft communique seen by Reuters and confirmed by several market sources......

Read - BS

External debt remains within manageable limits: report

....The status report presents a detailed analysis of India’s external debt position as at the end of March this year and is based on the data released by the Reserve Bank of India (RBI) on June 29, 2012. Apart from analysing the trend, composition and debt service of the country’s external debt, it provides a comparative picture of its debt vis-a-vis other developing countries and analyses the external sector vulnerabilities in view of the fluid global economic situation......

Read - The Hindu

Is Chidambaram our next Muhammad bin Tughlaq?

....Palaniappan Chidambaram will go down, along with a reluctant RBI chief Duvvuri Subbarao, as the joint holders of the Tughlaq No 3 title. Under pressure from a worsening fiscal deficit, Chidambaram will not only be printing more money than ever, but even the money he collects as revenue from disinvestment may be really be little more than an IOU for money to be printed in future. He will be committing the government to remain a Tughlaq well into the future..... 

Read.......

Why is RBI giving us the wrong advice on gold?

..... But what puzzles me is a more serious issue. Either gold is money or it’s not. I happen to believe it is. But Chakrabarty is entitled to his opinions........

Read.......