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Tuesday, June 4, 2013
Silence is golden, dear governor
Customer service in banking is not negotiable asserts Dr Chakrabarty
............"Customer is the most important part of a banking system and it is necessary that the bankers does not ‘squeeze’ customers. However, after saying this, we must understand that banking is not just a service but it is also a business and banks need to levy charges on services in order to survive"..........
With new banks, customer service all set to improve: K C Chakrabarty
........The Reserve Bank of India today said customer service would be better once new banks come in. K C Chakrabarty, Deputy Governor, RBI, today said "if new banks come in, then many of our problems will be solved." Chakrabarty's comments assume significance as RBI is allowing new banks in the private sector, for which it has issued clarifications on the guidelines today..........
Rush in banks for new format cheques
...........This is not a stray incident these days; bank branches are flooded with thousands of customers to give cheques in the new format to replace the older ones. The situation will become worse as majority of the customers are yet to receive an intimation from respective banks regarding giving cheques in the new format.............
Soon, cheque bounce won’t be a legal offence
The
government will soon bring an amendment in the Negotiable Instruments
(NI) Act that will restrict banks from dragging a person to court for an
offence like cheque bounce. All such cases, after the changes are
affected, will have to be decided only through arbitration, conciliation
or settlement by Lok Adalats.............
Read - TOI
Read - TOI
HDFC Bank to re-examine KYC details of pre-'08 a/cs
HDFC Bank, the second-largest private sector lender in India, has started re-examining the know-your-customer (KYC) details of accounts opened more than five years ago. The move comes after Cobrapost, an online magazine, alleged that HDFC Bank was one of the private lenders that violated KYC and anti-money laundering rules.............
Unified regulator may take time: FSDC
A unified financial regulator is unlikely anytime soon. The Financial Stability and Development Council (FSDC) today said major recommendations of the Financial Sector Legislative Reforms Commission (FSLRC) would take time to be examined and taken forward. FSDC, which met today under the chairmanship of Finance Minister P Chidambaram, said while some of the major legal and institutional reforms suggested by the commission would take time, action on other recommendations could be taken up separately, in consultation with various stakeholders............
Read | Business Standard
Punjab & Sind Bank - Change in Directorate
......... has nominated Shri Pradipta K. Jena, CGM & Regional Director, Reserve Bank of India, Patna, as Director of the Bank in place of Shri B. P. Kanungo, until further orders, vide ............
Obituary
Mr. A. Sitaraman, Retd. Staff Officer, RBI passed away on 01.06.2013. Z-74, Anna Nagar, Chennai. Mobile: 94446-88826.
Income-Tax department to put salary slips of top India Inc executives under TDS scanner
Income-Tax department has decided to scan the salary structure of top India Inc executives of large corporates and PSUs to examine hidden tax opportunities in the perks and reimbursements made to them.........
How long the stake holders of banks and taxpayers tolerate the menace of NPAs and cross subsidise them ?
......The rating should be made transparent through various ways by RBI, SEBI, and the Govt. Corporates should be made to indicate the rating given by banks in their Balance sheets and the rating has to be certified by the Accountants and Auditors and this rating should be taken as an important yard stick by the Govt and all other agencies to provide concessions and benefits.......................
The Bypass Banking
......“We have limitations and we can not say banks what to lend and how to lend?” RBI governor D Subbarao told reporters on May 9 during his second visit to the state in last 15 months. “We invoke a moral authority to tell them that they should raise their (credit deposit) ratio.” That is exactly what the regulator has been doing...........
Can't bank on it
........When the RBI central board met in Srinagar on May 9, one would have expected the board to take some decisions to look into the issue of KYC regulations. At the very least, the board might have asked for a report on the enforcement of KYC regulations, or a review of the audits carried out on banks by the regulator. Alternatively, the management of RBI would have informed the board of the steps to be taken to review the working of the KYC regulations. The board might have highlighted the need for better regulatory oversight........
New bank licence norms get tougher as RBI clarifies at length
.......Commenting on RBI clarifications, Ernst & Young India partner and national leader banking and financial services Ashvin Parekh said: "Today's clarifications have rendered a lot of clarity to the whole process and makes even more difficult for many to finally get the licence. "The best part is that it has considerably reduced the element of discretion at the hands of the regulator and thus leaving limited rooms for disputes,"........
Not possible to give bank permits to all eligible seekers: RBI
........."There is no predetermined number. RBI will be very selective while considering the applications for new bank licences. It will look for very high quality applications," the RBI said in a notification elaborating its response to the queries raised by various stake holders. "It may, therefore, be not possible to issue licence to all the applicants meeting the eligibility criteria," it said..............
No threat of stagflation: Subbarao
..................."There is a threshold level of inflation. If inflation is above that level, it is inimical to growth. If inflation is below that level it is possible that you can bargain for higher growth, tolerating a little higher inflation,".............
RBI not targeting any particular exchange rate: D Subbarao
With rupee hitting 11-month lows against dollar, Reserve Bank Governor D Subbarao on Monday said it is not targeting any particular exchange rate or any band. "We do not target an exchange rate. We do not target an exchange rate band. And I believe that our actions or inactions have been consistent with our policy," he said in an interview in New Delhi........
Tough but necessary
.......The new norms do show some consideration for the impact of extraneous factors on a borrower's ability to service his debt. For infrastructure projects as well as for other investments, delays resulting from lack of clearances and other policy and administrative bottlenecks can be taken as mitigating factors by banks, thus exempting these exposures from parity with NPAs. This is not necessarily consistent with best practice, but it simply accommodates the legacy of banks having lent heavily to infrastructure projects a few years ago, when these sectors boomed and other sources of long-term finance were not in place. Importantly,..........
Sahara’s Subrata Roy wants bank licence
.........“The Sahara group deserves a permit because its companies have provided financial services to many Indians who didn’t have access to banks, though the disputes with regulators make it unlikely that it will win a licence,” Roy said in the interview. .........
Here's why Shriram group may stay away from banking biz
Chennai-based Shriram group, the parent company of Shriram Transport Finance - the largest financier for small-time truck operators, may stay away from entering into the banking business due to stringent Reserve Bank of India (RBI) guidelines. However, it will take its final decision by the third week of June this year..............
RBI clarifications can be interpreted subjectively: Parekh
...............“Given that it is not going to be an unlimited number of licenses, clearly there have to be a sliding scale of what the RBI thinks are good entities” ............
RBI clarifications are on expected lines: Indiabulls
........The idea is for RBI to ensure that you don’t have any dominant shareholding structure, it should have a well-diversified shareholding structure and also it should be consistent with the Shyamala Gopinath committee's guidelines with regards to banks being held by the NOFHC's...........
Did RBI just make bank licence very, very difficult?
The Reserve Bank of India (RBI) seems to have quietly rolled a grenade at those aspiring for a bank licence. In its clarification to queries on new bank licence guidelines on Monday — to the final guidelines issued in February — the apex bank has said the promoting company aspiring for one must have at least 51% public shareholding. Yes, “at least 51% public shareholding”..............
RBI Fails to Clear Air, Won’t Issue Bank Licences to All
.........
The regulator declined to say by when the next bank will be born. The
central bank has also poured cold water on hopes of regulatory
forbearance on liquidity requirements for finance firms such as IDFC,
which are planning to convert into banks. The 165-page clarification on
new bank guidelines posted on RBI’s website failed to define the two
key measures on which it would grant a bank licence — ‘fit and proper’
persons, and businesses ‘misaligned with the banking model’..................
Field to be levelled for all on PSL, rural branch norms: RBI
The Reserve Bank today sought to allay apprehensions over the lack of level-playing field on issues like rural branch presence and foreign holdings between the existing lenders and the new ones who are to be granted licences. ...........
Read - ET
Read - ET
High CAD a matter of concern: RBI Governor
Calling current high CAD as a matter of concern, RBI Governor D Subbarao Monday said this would be factored in the monetary policy review later this month to contain the deficit. "CAD is a matter of concern and this is something which we will take into account in our monetary policy decision," he said in an interview...........
Future answers
..........Thus, it promises vaguely to disclose the product structure of the bonds later in the year. Apparently, it does not even know what the valuation of the bonds will be. The value of a bond is normally the price at which it is quoted in the market. But the RBI does not expect that its innovative bonds will be traded soon in the market; it hopes that some valuation guidelines will be issued by the Fixed Income Money Market and Derivatives Association of India. This vagueness may not bother the personal investor unduly, for he may well keep away from indexed bonds until some market experience of them accumulates. But banks will be concerned, for the RBI has made them eligible for investment in inflation bonds..........
Inflation-indexation bonds: Not much for retail investors
With the first tranche of inflation-indexation bonds (IIB) going to be on Tuesday, retail investors would be expecting to finally earn positive real returns (above the rate of inflation) from their debt investments. To encourage retail participation, the Reserve Bank of India (RBI) has also increased the non-competitive portion (read portion earmarked for retail investors) from the existing 5 per cent to 20 per cent............
Deflating gold
..........So, if the government were to dramatically increase the amount of inflation-indexed bonds available for the retail sector, chances are a large number of investors may be tempted to choose these instead of gold. Keep in mind that, over the past 3 months, gold has delivered an inflation-adjusted return of minus 46%; over 6 months, the returns are bit better, but still at minus 34% on an annualised basis. Even over 2 years, the inflation-adjusted return is under 1%, certainly lower than............
Govt mulling steps to check huge gold imports
.......The Financial Stability Development Council (FSDC), chaired by Finance Minister P Chidambaram, met and discussed the issue. For May, the import of gold was 162 tonnes, Chidambaram said after the meeting. "The Council noted with concern the significant increase in gold imports in recent months and deliberated on the issues involved in this regard," the Finance Ministry said in a statement after the meeting.......
Non-bank agencies keep gold tap flowing
...........To beat the curbs, banks imported heavily and the central bank decided to tell them to stop from May 13. After that, non-bank nominated agencies have become very active under this route, something RBI has been silent on. The World Gold Council has estimated total imports in the April-June quarter to be 300-400 tonnes. In April-June 2012, net gold import was 153 tonnes, it has said.............
RBI releases quarterly statistics on deposits
............The data was classified according to states, districts, centres (top 100 and 200 centres), population groups and bank groups. RBI stated that the top hundred centres, arranged according to the size of aggregate deposits accounted for 68.3 per cent of the total deposits and the top hundred centres arranged according to the size of gross bank credit accounted for 77.4 per cent of gross bank credit...........
Ponzi Schemes are Cows for Concern
.....Milking
the exchequer to milking the public is but a short step, so, the
formulators of this alleged “cattle-and-ghee” scam cannot be accused of
originality. Indeed, if more investors read relevant cautionary tales
from the Panchatantra — one appeared in Speaking Tree last month — they
may be warned off by déjà vu feelings when being fed such
ghee-cattle-profit spiels.
Amway imbroglio stirs up a fresh debate
.......“The crackdown (on Amway) should have happened much earlier. One has to unearth all wrong committed by companies operating Ponzi schemes. They have to be regulated by the Reserve Bank of India. Time has come for the RBI to step in. There should be a global ban on chit funds or companies running ponzi schemes,”............
Govt, RBI cannot protect the rupee and they should not try either
.......... The government and RBI should let the INR run its course rather than taking knee jerk actions at lower levels. The economy will benefit from an INR that is behaving in line with current fundamentals and there is no reason to believe that the INR will not rise going forward as the economy corrects and stabilizes.............
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