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.
Wednesday, April 17, 2013
Union Bank new office in Varanasi
Bank On The Right Bank
When starting your entrepreneurial career, it matters who you choose to associate with. Your choice of partnership at this stage could make or break your start-up. So, take a step back and think as many times as it takes before you partner with someone. Even that reputed bank. A bank, which carries out your daily transactions and lends you money from time to time to fund your business activities must be chosen after considering a variety of factors. Here’s what a first-time entrepreneur should look for in a bank while opening an account for business purposes............
Customers should demand good services from banks - RBI Deputy Governor
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| .................."If banks do not provide proper service, then it is wrong to blame the RBI. Customers should either demand proper services from the bank or leave the bank,"................. |
Will this 79-year old’s protest move the government and the RBI to stop mis-selling by banks?
.......I wrote to the RBI Governor Dr Subbarao, SEBI chairman UK Sinha, RBI Deputy Governor Dr KC Chakrabarty and the revenue secretary Sumit Bose about Mr Sharma’s case on 12thApril. As usual, they have maintained a complete silence. To us, the deliberate cheating of senior citizens and women—who are the biggest targets for banksters—is a bigger problem the same bankers laying out a red carpet for those with political black money to be laundered.............
Hurdles to new financial code
........ So what does the FSLRC Report say that is so upsetting and why is it upsetting to so many people? In its essence, the report says that the regulatory structure for the Indian financial system is old, based as it is on some laws which are more than 140 years old. Old itself is not the problem; the issue is a piece-meal approach to financial sector regulation that has resulted in a ground-level mess with multiple regulators and large regulatory cracks...........
Interview with Justice Srikrishna, Chairman, FSLRC
.....The burden of financial inclusion cannot always be thrown on the regulated entities. If financial inclusion means development of the regulated entities to expand the scope of their activities so as to benefit larger numbers, that is legitimate scope of the regulator and can be done by the regulators. If financial inclusion is intended to achieve a social purpose that is not the legitimate scope of the regulator, then it becomes a part of the government’s policy and the government is obligated to compensate the regulated entities which have to carry the additional cost of such financial inclusion.............
Read.........
Rural Bank Norms May Stump New Aspirants
A large number of non-banking finance companies have less then 10% presence in rural areas, data shows. The statistics portend trouble for companies eager to get licence for banking..........
An unusual commission
.....This brings me to the division of work between Reserve Bank and the finance ministry. Before the 1991 reforms, the situation was simple. Government made policy in so many fields with so many instruments that their coordination could only be done in Delhi. No one ever thought of independence of the central bank. Governor of Reserve Bank was just one cog in the machinery of controls. When the reforms came, the lightning liberalization was done in Delhi. There was no question of Reserve Bank being part of it: the external economic situation was dire, and Reserve Bank was left alone to tackle it with the extremely intrusive instruments it used. Reserve Bank officials were in love with their controls; they liked to think that they were the only patriots at a time when those in Delhi had sold out to the International Monetary Fund and the World Bank........
Financial inclusion
.....The present licensing policy for opening branches is that individual banks can open any number of branches in rural, semi-urban and unbanked centres. The RBI permits opening branches in urban and metro centres based on the bank’s performance on opening branches at other centres. Will the corporates applying for new bank licence open branches in unbanked areas before leaping to lucrative markets?.............
Bad loans
This is with reference to the article “Economy is not the villain” (Business Line,April 12). It has been assertively pointed out that poor credit appraisal and improper monitoring of the loan operations are the main reasons for the bad loans in banks. Nevertheless, the slow down in the economy cannot be pointed out as the major reasons for bad loans. If it is so, private banks must also show increasing NPAs. The best way to monitor loans and prevent bad loans is to appoint a RBI nominee in the board of corporates with above Rs 100 crore borrowing from banks.
- N. R. Nagarajan (HBL)
RBI to introduce Rs 10 polymer notes on trial basis
MANGALORE: The Reserve Bank of India (RBI) will execute a union government's mandate to introduce plastic/polymer currency note of Rs 10 on a field trial basis in five cities in India. Depending on the success of the move and how these notes work, the RBI will then decide on the next denomination of such notes that have to be brought out, KC Chakrabarty, Deputy Governor, RBI said. "It will not be tomorrow. There is a process involved," he said............
On the cusp of change
Lower inflation will not only boost the case for a rate cut by the Reserve Bank of India (RBI), it will also have other salutary effects. One of the reasons for lower inflation is softer international commodity prices, including much lower crude oil prices. This will help lower fuel subsidies and help narrow the fiscal deficit. ............
A rate cut by RBI is ‘not a done deal’, says Nomura
.......“We think monetary policy decisions based on WPI inflation (ignoring elevated core CPI inflation and supply constraints) will be erroneous. Monetary and fiscal policy should move hand in glove,”.............
NHGs falling prey to lure of ‘easy money’
..........Private moneylenders in the district are trying to interfere in the working of the NHGs by offering ‘easy money’ despite the existence of systematic banking programmes. The District Kudumbashree Mission has conceded that there are attempts by private moneylenders to provide loans to NHG members, overriding the rules and regulations stipulated by the state government and the RBI..............
‘Ignore messages offering money’
In response to complaints from customers that they get SMS saying they won large sum of money claiming to be from RBI, Deputy Governor K.C. Chakrabarty asked them to ignore such messages. He said that the RBI did not deal with individuals but was regulating the banks. “It is not a law enforcement agency,”......
AMC, Repalle hit by financial scam
......While the junior accountant has been arrested by the police, secretary of the AMC, Rajani, has been suspended by the Commissioner of Marketing after a report by the Joint Director, Vigilance, Marketing Department nailed the negligence of the AMC staff. The culpability of bank officials was also being investigated since the money was credited to the personal account of the junior accountant. “We have completed our inquiry which established the illegal diversion of AMC funds and on the basis of our report, and the police have taken action and arrested the accused. We will be writing to the Reserve Bank of India to take further action,” said Joint Director, Vigilance, Marketing Department, Lakshmanudu..........
“The day FI becomes their need, things will change”
....It is the beginning but banking culture is developing. And for this I give credit to the ‘ultra small branch’ model and fully support it. Though RBI says that unless it (USB) is manned by a bank employee it cannot be called a branch, the government says within the 5 km radius some structure should be available so that between the base branch and that place, the customer should have some place to visit............
The RBI view of India's macro challenges
.......The RBI acted fast post the crisis to reverse accommodative monetary policies, raising the policy rate 13 times by a cumulative 375 basis points, from 4.75% to 8.5%. Wage inflation has responded slowly but it has responded, falling from 10.9% in April 2010 to 6.6% by January 2013. Inevitably the RBI has taken some stick for tightening monetary policy, and has been blamed for "choking off growth", but Subbarao says that the bank will be sticking to its guns...........
Banking: Best Foot Forward
.........A lot of this has been made possible by a very balanced approach to regulation by the Indian regulator, the Reserve Bank of India (RBI). The fact is that it plays 3 roles—one is of an economic advisor to the government, monetary policy maker, and the regulator of banking—only adds to its effectiveness.......
House panel seeks details of tax revenue foregone, bank bad loans
.....Noting that every public sector bank had two to three per cent non-performing assets (NPAs), the committee also demanded that the Reserve Bank of India and the Finance Ministry set up a group to study the issue. “We have asked the RBI and the Ministry that this group can submit a report on each NPA worth more than Rs 1 crore. This exercise should be done within three months,” a member of the panel said. A report with this recommendation will be submitted to Parliament during the second lap of the Budget session, slated to begin on April 22........
CII roots for reforms
.......“The RBI needs to work in tandem with the government to boost growth by easing interest rates by at least 100 basis points in the current fiscal. Early implementation of GST will help in adding 1-1.5 per cent to GDP,” ..........
Nagpur's coop banks now in better financial health
...... The regulator Reserve Bank of India (RBI) only considers the gross NPA as the yardstick of bank's financial health. However, the banks prefer to clean their balance sheet as far as net NPAs are concerned. For bringing net NPA to nil, the bad loans have to be brought down to minimal levels too. This requires diligent banking, say cooperative banking experts. According to RBI norms the gross-NPAs should not go beyond 10%............
Revision in wholesale inflation may worry Reserve Bank
......The March WPI figure is below the Reserve Bank of India's (RBI) projection. In the third-quarter review of the monetary policy held on January 29, RBI had said, "Keeping in view the expected moderation in non-food manufactured products, inflation, domestic supply-demand balances and global trends in commodity prices, we revised downwards the baseline WPI inflation projection for March 2013 from 7.5 per cent to 6.8 per cent.".........
Issues in PSU banks
........They not only lost manpower, but their technology was not developed to compete with fast and aggressive new banks. PSBs today do not attract the best of human resources from the market because of several inhibiting factors, such as poor salary structure............
Private banks better placed than public lenders
......Private sector banks are likely to have performed better than their public sector rivals in the fourth quarter of 2012-13 due to better asset quality, higher net interest margins and strong loan growth. One analyst report said January-March private bank profit would rise more than 20% and that of government-run lenders would drop close to 7% from the year-ago period.......
When Budget says don’t buy gold, why are banks selling yellow metal?
..........Replying to this, K.C. Chakrabarty, Deputy Governor of Reserve Bank of India, said that if a bank is selling gold, RBI will not come in its way. Banning a particular activity is a policy level decision. Stating that the issue is under examination, Chakrabarty said: “Personally I am in favour of your opinion.”.................
Fall in gold prices can impact asset quality of banks and NBFCs : India Ratings
....India Ratings said that the impact of falling gold prices could be felt across the industry, the gold loan NBFCs is more vulnerable than banks’, despite similar LTVs at the time of disbursal. Among the banks, south India based private sector banks are likely to be more impacted, primarily due to the higher proportion of gold loans in their books said Prakash Agarwal, associate director (Banks) of India Ratings in a note. He further said that agency is reviewing the gold loan portfolios of rated banks and NBFCs to evaluate the impact fall in gold prices on profitability......
Gold loan firm Manappuram Finance can't collect money for chit funds
.........The Reserve Bank of India had opposed the move by the management to utilise the branches of Manappuram for its group business, culminating in exchange of communication between the management and the banking regulator over the past few months........
Gold's Plunge Is Happy News for India's Brides and Economists
......Consumers aren’t the only people in India happy to see a bear market for gold. The country’s economic gurus, too, are no doubt relieved by the 19 percent fall in gold prices since the beginning of 2013. The high cost of gold has been a significant burden for the already struggling Indian economy............
Will go full throttle to recover dues from Kingfisher airline: Pratip Chaudhuri, SBI Chief
........."We have given instructions to recover and enforce all the securities. Our intention is to sell everything...all means of recovery (will be employed)...nothing would escape. Till such time as we will get back our dues in full, we will press our full recourse on all the securities that we possess,"....
BANK IN BHEL
The State Bank of Hyderabad, BHEL Ramachandrapuram, is rendering services since 30 years in the area. Since it is the only branch, the bank is unable to ensure personalised service to customers. Moreover, there is no other public sector bank like Andhra Bank or SBI. The bank ATMs also don’t work properly. No one is responding even after lodging a complaint. We request the RBI to establish another public sector bank in BHEL to meet customer needs.
- S. Viswanadham, Chikkadapally (HBL)
SBI mulls merging one of its associate banks this year
...."Now that the capital conditions are favourable for merger, we will think about it," Chaudhuri told reporters. However, he did not indicate any timeline. "For us, all five fingers are the same," he said when asked which of the remaining five associates would be considered first for merger.........
SBI loan growth in fiscal 2013 at 21%: Pratip Chaudhuri
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| .........“Only thing that impacts base rate is a cut in cash reserve ratio (CRR). If there is a one percentage point cut in CRR, I can assure you at least 20 basis points (bps) cut in our base rate,”......... |
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