.......Consider, for example, the debate about bank regulation. Bankers are widely reviled today. But banking is also mystifying. So any critic who has the intellectual heft to clear away the smokescreen that bankers have laid around their business, and can portray bankers as both incompetent and malevolent, finds a ready audience. The critic’s message—that banks need to be cut down to size—resonates widely. Bankers can, of course, ignore their critics and the public, and use their money to lobby in the right quarters to maintain their privileges. But, every once in a while, a banker, tired of being portrayed as a rogue, lashes out. He (it is usually a man) warns the public that even the most moderate regulations placed on banks will bring about the end of civilization as we know it. And so the shrillness continues, with the public no wiser for it........
Friday, March 29, 2013
Policy has to focus on domestic drivers for growth: Subir Gokarn
..............Gold is an important issue and the Reserve Bank came out a few months ago with a set of recommendations relating to development of financial products that can substitute for gold. On one hand these are things like inflation index bonds but there are also other gold specific products, what I would like to call dematerialise gold products or Demat gold products, which give you the investment attributes of gold, but without the need to physically possess it. That is the set of alternatives where the physical import of gold may be reduced even though people want to invest in it..............
Srikrishna emasculates RBI, shifts power to finmi
..............The RBI remains the regulator for the banking sector. But look closer, and the central bank’s centrality in financial regulation is gone: it will run monetary policy, regulate the banking sector and enforce consumer protection. Nothing more. What has gone out of its jurisdiction are the following...........
FSLRC report: RBI's authority in question
.........The dissenting notes have come from KJ Udeshi, former Deputy Governor, RBI, PJ Nayak, country head of Morgan Stanley (but formerly chairman and managing director of UTI Bank and joint secretary in the capital markets division of the finance ministry), YH Malegam, currently in the Board of Directors of RBI and JR Verma, the academic from IIM Ahmedabad..............
Panel for more government say on monetary policy
........Raghuram Rajan, the finance ministry's chief economic advisor, who many expect to replace Subbarrao when his term ends in September, told Reuters last week he favoured clipping the power vested in the post of governor and supported a committee approach. When it comes to making policy decisions, Subbarao in practice does take the views of staff and an advisory committee on board. But he often goes against the panel's advice, minutes of central bank meetings have shown. Under the draft bill, which would replace 15 different financial sector laws, the seven member monetary policy committee would be headed by the governor and include two members appointed by the government in consultation with the bank along with three outright government appointees............
Keeping NBFCs under RBI purview makes no sense: FSLRC chief
....That is another argument that doesn't make sense to me. NBFCs that take deposits have been recommended to be placed under the purview of the RBI with the mandate of acquiring a banking licence. But there are NBFCs that are doing business without taking deposits from the public. Now why did they come into existence at all?............
RBI freedom under threat
......The role of the RBI Governor will be severely circumscribed with the report suggesting that an executive monetary policy committee (MPC) will be formed to vote on policy decisions — borrowing an idea from the US Federal Reserve and the Bank of England. “The MPC would meet regularly, and vote on the exercise of these powers, based on forecasts about the economy and the extent to which the objectives are likely to be met,” the report said. RBI Governor Duvvuri Subbarao appears to have had some inkling of the momentous change that had been suggested........
Will govt get a greater say in fixing monetary policy?
In an interview to Bloomberg TV a few days after he announced the new Union budget, finance minister P. Chidambaram said in response to a question about interest rate policy: “I think the RBI should take comfort from what we have announced as the fiscal consolidation path and I am sure the monetary policy advisory committee will advise the governor appropriately.” It was odd that the finance minister had signalled to the monetary policy advisory committee rather than governor D. Subbarao directly, especially since the latter has often taken decisions contrary to what the committee had advised him..........
Consumer interests at centre of new financial sector omnibus law
...........The Code has drawn up a single judicial tribunal for the sector called Financial Sector Appellate Tribunal, a Resolution Corporation to wind up companies that get into distress, the Financial Redressal Agency, Public Debt Management Agency and the modified Financial Stability and Development Council.
Read - IE
Turn LIC, RBI into regular cos, says Srikrishna panel
A high-powered expert panel set up by the government to suggest a recast of the financial sector laws has recommended a level-playing field for financial firms by doing away with specific laws for public sector entities such as Life Insurance Corporation and State Bank of India. The justice B N Srikrishna headed Financial Sector Legislative Reforms Commission (FSLRC) has mooted incorporation of such entities like others in the sector under the Companies Act to ensure ownership-neutrality in regulation and supervision...........
Bank Alone Not a Safe Deposit for Women
After
lauding P Chidambaram’s move to set up a state-run women’s bank, there
is a growing concern in Congress that this may not be enough to fulfill the party’s promise to empower rural women with better access to credit.
Senior Congress leaders and sections of the government, feel that a
specialised financial institution similar to Nabard or Sidbi would be
more effective in meeting the party’s objective. In a letter to
Chidambaram, Rural Development Minister Jairam Ramesh has suggested an
alternative strategy and proposed setting up a “specialised
developmental financial institution” on the lines of Sidbi through an
act of Parliament............
Read - ET
Read - ET
Banking on the fair sex
GUWAHATI: Chidambaram may have hit upon the idea now, but Lakhimi Baruah of Jorhat has been running a profitable all-women bank for the past 14 years. When finance minister P Chidambaram announced an all-women public sector bank in his Budget speech, Lakhimi Baruah was thrilled. The 64-year-old, who lives in Jorhat in Assam, has been providing banking services for women, by women since 1998. "You don't know how happy I am that the finance minister proposed this. It will empower women financially," she says..............
Money chain case: woman held
........ The firm was running its business in violation of the provisions of the Prize Chits and Money Circulation Scheme (Banning) Act 1978 and also Section 45 (s) of the Reserve Bank of India Act. Though the company had promised to purchase land in the name of its clients, none of the depositors had been given documents of such purchases..............
Bank of Maharashtra convenes 118th SLBC Meeting
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(L-R) are : Shri. Madhukar Choudhari, Commissioner, Cooperation, GoM, Shri. M. V. Ashok Chief General Manager, NABARD, Smt. Phulan Kumar, Regional Director, Nagpur, RBI, Shri. J. B. Bhoria, Regional Director, Maharashtra & Goa, RBI, Shri. Narendra Singh C & MD, Bank of Maharashtra & Chairman, SLBC – Maharashtra, Shri Munaf Hakim, Chairman, Maharashtra State Minorities Commission, Shri C. VR. Rajendran, Executive Director, Bank of Maharashtra, Shri Shravan Hardikar, CEO, Maharashtra State Livelihood Mission and Shri A. A. Magdum, General Manager, Priority & Convener, SLBC, Maharashtra |
Come April, you can use RuPay even online
......These online-enabled cards may turn attractive for mainstream banks, unlike ATM-only and debit ones, which are targeted more towards co-operative and regional rural banks, and rural and semi-urban bank branches, respectively, because of less internet-savvy clientele there. “Mainstream banks will not issue RuPay cards to their customers till the e-commerce option is enabled. From April, they will start issuing,” said A P Hota, managing director and CEO, NPCI. To begin with, two banks will issue new RuPay cards from the second half of April, and others are likely to follow suit, Hota added. ........
RBI puts off Basel norms for forex derivatives to January 2014
MUMBAI: The Reserve Bank today postponed the implementation of Basel-III regulations for currency derivatives segment to next January pending resolution of norms regarding trade settlement, even as it said the new capital adequacy requirements will kick in from April 1..............
RBI notifies new rates for small saving schemes
The Reserve Bank of India (RBI) today notified 0.1 per cent reduction each in the interest rates on Public Provident Fund (PPF) and Senior Citizen Savings Scheme (SCSS) to be effective from fiscal beginning April 1, 2013...............
Chidambaram to inaugurate 300 new bank branches
......."At the meeting with RBI Governor D Subbarao on Jan 15, state chief minister Akhilesh Yadav requested him to open 3000 more bank branches keeping in mind the population of the state. Now RBI and state government has fixed the time table to open these branches by March 31, 2014", ..........
ACP envisages Rs. 3391.25 crore under priority sector
The Annual Credit Plan for Thanjavur district for the year 2013-14 envisages a total plan outlay of Rs. 3391.25 crore under the priority sector, which is an increase of Rs. 798.91 crore (31 per cent) over the last year's plan, said K.Baskaran, Collector, here on Wednesday.............
Rupee Bank to auction four properties to raise Rs 14 crore
PUNE: The administrative board of the city-based Rupee Cooperative Bank Ltd has decided to auction four properties together valued at Rs 14 crore to improve the bank's recovery, said Sanjaykumar Bhosale, one of the administrators of the bank, told reporters on Thursday..........
The Bhuj Mercantile Co-operative Bank Ltd., Ahmedabad now to be under RBI Directions till October 02, 2013
The Reserve Bank of India has extended the period of directions imposed on the The Bhuj Mercantile Co-operative Bank Ltd., Ahmedabad for further six months. The Bank with thus continue to be under directions from April 02, 2013 to October 02, 2013. The modified directive has been displayed on the bank premises for interested members of public to peruse.........
Read......
Read......
SBI wages rate war, undercuts competition
.A senior SBI executive, who is responsible for the “rate war” and does not want to be named, says there is no war and his bank can lend at a rate which is cheaper than many others for the simple reason that it has a lower base rate than others. SBI’s base rate is 9.7%, the same as that of HDFC Bank Ltd. India’s largest private sector lender ICICI Bank Ltd’s base rate is 9.75%, but most other banks have pegged their base at 10% or even higher. For instance, the base rate of both Punjab National Bank and Bank of Baroda is 10.25%.....
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