.....Organisations succeed and grow because they figure out how to do a few things very well. These things - products or services, with all the attendant processes - then expectedly tend to crowd out everything else they do. People move up the ladder because they have been associated with successful activities. Over a period of time, the top leadership comprises exclusively people who have all come up in exactly this fashion. The focus of the organisation on these activities and the reward and recognition systems tied to them gradually leads to the disappearance of everybody who has other interests or perspectives, particularly from the top leadership......
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.
Monday, April 22, 2013
Report summarily dismisses financial inclusion - S.S.Tarapore
.........The Commission's perfunctory handling of financial inclusion is a major lacuna in the Report. It is as though the Commission's spaceship headed for Mars, has erroneously landed on Planet Earth. Its handling of financial inclusion is totally incomprehensible and borders on dereliction of duty. It is incumbent on the part of Commission members to recant and say mea culpa ( my fault).
Read - FPJ
Report throws up multiple contradictions
........ In so doing, it fails to reconcile or even mention that Dr. Subbarao had, on November 22, 2007, written to the then DoT Secretary, questioning the 2G pricing: “It is not clear how the rate of Rs.1600 crores determined as far back as 2001, has been applied for a license given in 2007, without any indexation let alone current evaluation”. The report gives the impression that Dr Subbarao was against increasing the price of spectrum, which is contradicted by his letter and multiple file notings in the run up to the 2G scam.........
BCSBI invites applications for Senior Vice Presidents at Mumbai
The Banking Codes and Standards Board of India (BCSBI) is a collaborative venture set up by the Reserve Bank of India and the member banks to evolve Codes and Standards for banks to follow while dealing with customers to ensure fair treatment of customers. BCSBI also acts as a watchdog to ensure that the Codes and Standards adopted by member banks are adhered to in true spirit while delivering their services............
Read...........
Link forwarded by Dr.Pramod Kumar
Read...........
Link forwarded by Dr.Pramod Kumar
Correct, not compound
....... The fact that the large number of vacancies are intended to be filled up by compromising on job specifications shows poor succession planning. Instead of compounding the lapse by relying on internal promotions in spite of a dearth of competent personnel, the banks should use the occasion to induct fresh and better talent at different levels, and go for adding young people at foundation levels (probationary officers and the like) by adjusting the intake against higher positions..........
FinMin for cost-to-company pay structure in state-owned banks
...........IBA is likely to ask for a 25 per cent rise for the 800,000-odd employees in the 10th bipartite agreement on wage revision. The rise is due with effect from November 2012. Though wage settlement negotiations usually go on for about two years, as bank unions begin with very high expectations, this time the government might settle by the end of 2013, since general elections are due in 2014. "If PSBs have to run like a professional company, then why not behave like one and move to the CTC concept? We have given this suggestion to IBA,"...............
‘RBI has principally agreed to bank merger’
Rupee Bank administrator Anaskar says discussion on with two nationalised and coop banks
........Anaskar said that banks from Gujarat, Madhya Pradesh and Maharashtra have shown willingness to help. He said that discussions are on with two nationalised banks and the merger issue has been discussed with two urban cooperative banks including Cosmos and Saraswat Bank...........
IDBI Bank participates in the Town Hall Event at Madgaon, Goa
.......... On the occasion, normally the Banking Ombudsman selects a few
banks to put up their stalls and display the product literature and
other publicity materials based on their business and branch network. However, IDBI Bank was specially chosen to set up a stall in view of
their quick resolution of customer complaints. Smt. Rose Mary Sebastian,
Banking Ombudsman cut the red ribbon and inaugurated the stall in the
presence of Shri Dipankar De, General Manager and Principal Nodal
Officer, IDBI Bank..........
Low denomination currency notes to become history
.....Along with the currency notes of Rs 1 and Rs 2, the Rs 10 note will also be a part of history. The Union Minister of State for Finance, Namo Narain Meena, it is to be recalled, made a statement in the Lok Sabha that considering the short duration and high cost involved in the printing of Rs 10 note, Reserve Bank of India is planning to gradually phase it out. It will be replaced by the coin worth its value. Though the cost of printing a Rs 10 coin comes around Rs 6, it has long duration of circulation as it can sustain the wear and tear of time................
Credit information bureaus want access to mobile bill payment records
.........Full-file reporting is any information that captures your repayment record with any entity and is given to the bureau. The repayments could be related to utility bills, lease rentals, and telecom service. “With more mobile subscribers than bank accounts in India, this (full-file reporting) can help credit bureaus access wider range of information. We have spoken to the Reserve Bank of India in this regard,” Jayaraman said..........
Disabled people have a hard time still at ATMs
......."Apart from orthopaedically challenged people, visually-impaired are also suffering a lot as ATMs are unfriendly," Kamaraj pointed out. Even though RBI guidelines to create disabled-friendly precede the state rules, banks have not adhered to the rules. "ATMs of both, nationalised banks and private banks, remain indifferent to this issue," according to a cross section of differently-abled people.
School that makes men
A modest-looking school, it has produced numerous men who have dominated their chosen fields. Here are some of them: Dr. Badrinath of Sankara Nethralaya , tennis legend Ramanathan Krishnan, former Chief of Indian Army Gen. Sunderjee, former RBI governor Y. V. Reddy, Dr. Nalli Kuppuswami Chetty and among the younger crop, Vijay TV’s Super Singer championship winner Krishnamurthy..............
Macroeconomics maya - A.Seshan
We have read in economics about how nominal values do not reflect reality. People often have a money illusion, in which they may feel better off with a rise in their nominal incomes, although their real incomes, or the purchasing power, might have fallen owing to inflation. Economists take care of such an illusion when they compile the real gross domestic product (GDP), or the net of inflation, to reflect the true underlying value of goods and services produced in a year. But, in my view, even that is illusory.........
Banking on inclusion
.........In the past, the apex bank’s stated objective for granting new licences was to infuse competition into the banking sector, which was largely dominated by public sector banks. Consequently, new private-sector banks have brought about a paradigm shift by increasing the efficiency of the domestic banking system, and introducing newer and more sophisticated financial services like mobile banking. This time, the buzz word is financial inclusion — the process of providing access to the financial products and services needed by weaker sections and low-income groups at affordable cost in a fair and transparent manner...........
Trust to open financial literacy centres
........The Trust has already imparted knowledge to over 5.45 lakh people through 37 centres. At present, the Trust has 18 centres in the state. Trust secretary N T Hegde said that the Trust, jointly sponsored by Syndicate Bank and Vijaya Bank, was established in 2010 as per the Reserve Bank of India guidelines with an objective to educate people on financial products and services...........
Risk Management
............Dr. T. V. Gopalakrishnan, who wrote authoritatively on NPAs has written incisively on the greatest risk in the banking system — viz., the human resources. Banks are at once dependent on and managed by persons and these human agencies are prone to a high level of risks, if not properly managed. The volume throws a flood of light on risk management and is highly relevant in the light of Basel III norms. It is warmly commended to all planners, bankers, financial analysts and students of economics and banking.............
Book Review by P.P.Ramachandran
More freedom for cash
The banking industry is justified in seeking a one percentage point cut in the cash reserve ratio (CRR) — the proportion of deposits required to be compulsorily maintained with the Reserve Bank of India. True, the present CRR requirement, at 4 per cent of banks’ net liabilities, is already a 40-year-low. The demand for pegging the CRR still lower at three per cent, however, has the merit of being in line with the received wisdom that regarded it as the bare minimum level necessary for the purposes of prudent banking...........
FinMin asks banks to get ready for 2nd phase of DBT scheme
.................It further said banks also need to ensure that a secure 'server to server' connectivity is operationalised with the National Payments Corporation of India (NPCI) which will automatic download and execution of payment advise file and generate the return of file indicating status of transaction, among other things. NPCI, an umbrella organisation for all retail payment systems, is conducting a pilot run with five banks for establishing secure server to server connectivity and is scheduled to be completed in this month............
Slowdown to continue in poll year
......The Reserve Bank of India (RBI) is also expected to keep much needed rate cuts at the minimum, so as to not aggravate the government, which would not want any drastic steps during the election campaigning periods. Although the RBI has committed to bring down the fiscal deficit to below 4.5% in FY14, any significant action to achieve this is not expected. However, the rate cuts between April 2012 and March 2013 were seen as a positive move. "RBI's decision to go in for another round of policy rate cuts was very aptly timed and was almost indispensable to revive the confidence of industry," continues Dr. Didar Singh............
Wockhardt launches 'Follow traffic rules'
NAGPUR: Considering the ever increasing accidents in city, Wockhardt Hospital has launched 'Follow traffic rules' drive as part of its corporate social responsibility to create awareness among masses about the increased fatalities, especially among children, due to violation of norms. To begin with, the campaign being organized with support and consent of the traffic department will run for five days that began on Saturday. The hospital has chosen for awareness the squares like RBI, Khamla, Shankar Nagar and Law College where the traffic is heavy.............
RBI may issue clarification on bank licences by early May
......."We have received queries from various entities. RBI will be posting on its website all the relevant clarifications with regard to new bank licence guidelines by this month end or early next month so that they get ample time to file applications," a senior RBI official said........
Why more banks should come up, soon
...... A set of new banks will strengthen and expand the industry and add to the resilience of the state-run banks, besides deepening the government bond market. Competition can bring down the bond yield too, benefiting the government, which is grappling with high fiscal deficit. More importantly, competition will benefit the consumers. Let many new banks come up, even if a few of them die................
Private bank entry hurts public banks
...."There will definitely be some quantitative and qualitative effects on the balance sheet of the public sector banks. With private sector banks coming in, the market size will be shared by new entrants, which implies that growth in the size of PSBs might not have been what it could have been in the absence of such new players," ..............
With RBI nod, country’s first mortgage guarantee company to get going soon
.....“Now that the certificate of registration has been received from RBI, this new venture will soon commence operations and start entering into MoUs with banks and housing finance companies,” R. V. Verma, Chairman and Managing Director of National Housing Bank, told........
Auditors in the dock?
.............Currently, audit of companies involves reporting on whether any fraud is noticed or reported during the year. In the audit of banks, the auditor should report to the Reserve Bank of India anything found susceptible to fraud, acts of excess power, or foulplay in any transaction. Under the new Companies Bill, the auditor has significant onerous responsibility............
Current account deficit takes centre stage on Dalal Stret
........“While RBI may cut rates faster than expected, the transmission of rate cuts will be slower than in earlier cycles. The credit-deposit ratio at 78 per cent is the highest it has been over past 15 years. Even adjusting for the lower SLR, this shows that ability of the banks to cut rates is lower than in earlier cycles,”......
Panel rejects RBI proposal to limit FII investment in sec market
........."The suggestion made by the RBI of limiting FII investments to secondary market was discussed. It was felt that considering the stage of capital market, it would not be prudent to place any restriction of this kind as of now,".....
HDFC bank contravened RBI instructions: Consumer panel
......."Therefore, we come to the conclusion that the bank failed to intimate the complainant about change in AQB.which is certainly deficiency of service and in contravention of the instructions issued by RBI. It straightaway deducted amounts of Rs 723 and Rs 89 from account of the complainant...,"
RBI may cut repo rate by 25 bps: Economists
.....“Right now, the conditions should enable RBI to cut repo rate. We expect a cut of 25 basis points (or 0.25 per cent) in its policy in May and may be by another 25 bps in the next review,” .....
Chidambaram hopes for rate cut to propel growth
..."Government would welcome lower interest rates," Palaniappan Chidambaram, 67, said in an interview in Washington on Saturday, where he is attending meetings of the International Monetary Fund and the World Bank. "But how low can interest rates go is a function of a number of other factors, especially inflation, and that's a call the governor has to take."........
Shun the Cypriot connection
When looking at the major economic crisis in the Republic of Cyprus involving the exposure of Cypriot banks to the Greek debt crisis, one is reminded of the Ahmedabad-based Madhavpura Mercantile Co-operative Bank (MMCB), which was closed down by the Reserve Bank of India in June 2012 when the outstanding loans were Rs 1,100 crore, of which Rs 800 crore pertained to a shares scam............
A reprieve for the Indian economy
......Nevertheless, lower oil and commodity prices will lower inflation; and if it’s correct that people have been buying gold as a hedge against inflation, then lower inflation should also lead to lower investment demand for gold. That, in turn, could lead to an increase in financial savings, a process that should also be helped by the Reserve Bank of India’s (RBI’s) issue of inflation-indexed bonds. Does this mean the economy is out of the woods? Not really............
Risk-reward looks good now
.......We believe there is a modest monetary easing cycle ahead, given limited room for the Reserve Bank of India. Despite the weakness in macro data points near-term, over the mid-to-long term, equities should get support from secular earnings growth; our bottom-up forecasts suggest mid-teens growth for the Nifty in FY14/15. We think current assumptions are conservative (excluding consumption) and are not building in any meaningful economic recovery, and hence these might not be difficult to attain...........
‘Rural demand driving growth in light commercial vehicles segment’
......Besides discussing the challenges facing his non-banking finance company (NBFC), Revankar observed that the cause of financial inclusion will be well served if the banking regulator allows more banks, NBFCs and credit societies to come up. Further, the regulator would do well to relax the curbs imposed on NBFCs. Excerpts from the interview............
Money-laundering probe: IRDA report likely in a week
Hyderabad, April 21: The Insurance Regulatory and Development Authority (IRDA) is likely to complete investigation into the alleged money-laundering transactions of insurers within a week. “Our inspections teams have been deputed to some insurance companies and the process is on. We may have a report ready within a week on the issue,” T. S. Vijayan, Chairman, IRDA, told newspersons on the sidelines of a seminar held here.............
Read - HBL
Kerala Financial Corp brings NPA down drastically
.......This is a story of a silent but amazing transformation at the State Financial Corporation, says K. Manmathan Nair, veteran development banker. Nair has had stints at senior levels with Small Industries Development Bank of India (Sidbi) and the RBI, apart from at KFC as its managing director. The 90s saw KFC in bad shape, struggling to fulfill its mandate, even as it failed to keep pace with the changes in the post-liberalisation regime,...........
Fixed Income is the flavour of the day
........The central bank is widely expected to cut rates by a minimum of 25 bps in its 3 May 2013 annual policy and is also likely to cut rates throughout this fiscal as the economy struggles to stay afloat. RBI rate cuts is highly positive for bond yields, which are likely to trend down throughout this fiscal. In a falling bond yield environment the best investments are in bonds and as a result of expected fall in interest rates, more and more investors are flocking to fixed income securities directly and indirectly............
NBFCs, more than banks, are at risk of default on gold loans
............Having said that, RBI must take care to keep the banking system safe and sound. The trouble with Indian banking system is that a crisis may unfold even when there is no reason for one, due to lack of transparency in the reporting structure, followed by various banks. Rumor mills are rife about how badly the bottomline of one bank or the other has been hit by falling gold prices. RBI must ask both public and private sector banks to declare their exposure and track record on gold loans, while announcing their quarterly results.
Saradha CMD siphoned off crores from 37 accounts
....The Sudipto (not Sudipta) Sen named in the gazette is son of Late Bhudu Sen of the Sanchayani Savings and Investments (India) Pvt Ltd. Police are examining records to find out whether the Saradha Group CMD Sudipta Sen is the same Sudipto Sen of the investment company registered as a residuary non-banking company under the Reserve Bank of India. According to the 39th report of the Petitions Committee submitted in Lok Sabha in January 2004, the company had collected Rs 800 crore from 50,000 small depositors.............
Sebi, RBI and ED to join forces against investment frauds
Amid a countrywide proliferation of fraud investment schemes, markets watchdog Sebi is joining forces with other agencies, including RBI, SFIO, Enforcement Directorate and state police departments, to tackle the menace. A large number of fraudulent schemes have come to the fore in recent months, wherein gullible investors are promised huge returns of up to 100 per cent in a year or two through 'bizarre and innovative' methods, a senior official said............
Trinamool has nothing to do with deposit-raising companies: Mukul Roy
........ If the State government taken timely action against such companies, many people could have been saved from ruination, he said. Asked about chit funds, CPI parliamentarian Gurudas Dasgupta said the Reserve Bank of India’s Governor had told him that such companies are under the purview of the State government.
Agents bear brunt of Saradha collapse
..........Banerjee cut his teeth in door-to-door deposit collection in the early 1980s as an agent of Peerless General Finance and Investment Co. Ltd—a residuary non-banking company, which pioneered in collecting small savings. Though it didn’t ever default on repayments, Reserve Bank of India (RBI) forced Peerless to stop taking deposits in 2005-2006. This spawned the growth of unregulated deposit-taking companies in West Bengal and other eastern Indian states. Exploiting the strength of Peerless’s impeccable repayment track record, its redundant field agents helped found new firms that went after people’s savings, mostly in rural areas...........
Blame game on chit onus
.......Addressing the press on Sunday, Dasgupta argued that the government could also have appealed to the high court to seize and auction the properties of chit fund companies that had taken investors for a ride, or written to the RBI and SEBI to act against them..............
Joint attack on fraud plans
....Sebi on its own lacks full-fledged powers to act against all kinds of “money-pooling” frauds, although a proposal to strengthen its arsenal is awaiting the government’s clearance. In the meantime, the regulator has decided to take a collaborative approach to bring to book perpetrators of these investment frauds, by seeking help from other regulatory and enforcement agencies. Sebi is tying up with other regulators and agencies depending on the needs and nature of the case, the official said, while adding that these entities include banking regulator RBI, SFIO, insurance watchdog IRDA, the Enforcement Directorate and the Economic Offence Wings and other police departments in various states.............
Court takes on ‘deposit’ firms
......The letter stated that according to the KMSS’s estimate, in the past few years, these companies had “illegally” collected around Rs 5,000 crore from investors in Assam. None of these, however, had the mandatory permission from any competent authority, be it Reserve Bank of India, Securities and Exchange Board of India (Sebi) or Insurance and Regulatory Development Authority (IRDA), to accept public deposits, it had alleged. The development assumes significance as it comes at a time when Saradha Group is facing the ire of depositors in Bengal and Bengal police are on the lookout for Sen, who has gone missing...........
1 registered chit fund, reveals RTI query
...........In response to some of the other questions, the officer in charge of EOI cell mentioned that chit funds in the state were controlled under Chit Fund Act 1982 and Registrar of Chit who is also the agriculture income tax commissioner was the controlling officer for all types of conventional chit. With regards to the action taken against any chit fund companies or owners, the reply stated that no information was available with the cell. with the cell in this regard it mentioned that EOI is the only cell concerned to take action. The Registrar of Companies and the Reserve bank of India by their respective acts can also take action, the letter further stated.............
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