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| .............."In order to claim, demand autonomy from the government, and to enjoy that autonomy, we must remember that we must tender accountability,".......... |
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.
Thursday, July 4, 2013
RBI must tender accountability to enjoy autonomy: Duvvuri Subbarao
RBI cannot operate from ivory tower: Subbarao
..........What clearly emerges is that the central bank should go well beyond monetary policy. Subbarao further said the RBI cannot function from an ivory tower and should refrain from shutting itself up in its own world. It should be attentive to what is happening around the world by becoming a knowledge institution............
Subbarao's 10 commandments for the central bank
...........Elaborating on the theory of RBI becoming a knowledge institution, Subbarao gave 10 attributes for the central bank to be future-ready, to facilitate itself to transform knowledge into wisdom. The attributes he listed were..............
Must take market as given and respond: Subbarao
.......“We very generously guard our autonomy, but in order to demand it we must first render ourselves accountable. I have suggested that the RBI Governor should go in front of a parliamentary committee to encourage the accountability process. Even if nobody asks, we must volunteer to render accountability,...........
RBI working on creating public awareness about Ponzi schemes
........"Communication should be two way. We should talk to people and listen to them. We had this Saradha incident in West Bengal about two months ago. And there has been lot of thinking within RBI itself about what we should do to spread awareness on these kind of things," .................
My View on "FM takes on Subbarao again":.......
It is intriguing that FM who interacts with RBI frequently, gives an impression that he has to speak to media to convey his expectations from RBI. Dr Subbarao, Governor, RBI has indicated more than once that GOI and RBI are on the same page and perceptions sometimes vary on specific issues, which is natural.
- M.G.Warrier
National Seminar on Financial Consumer Protection
Distinguished Dignitaries:
DR. DEEPALI PANT JOSHI, Executive Director, RBI
YOGESH AGARWAL, Chairperson, PFRDA
ANANTA BARUA, Executive Director, SEBI
Date: 24th July' 13 Venue: Hotel Royal Plaza, New Delhi
Mining ban hits banks in Goa
.......Understandably, while at the SLBC meeting while the State Chief Secretary B. Vijayan tried to push for restructuring of advances to the various stakeholders of mining like transporters and barge industry, etc., the Reserve Bank of India(RBI) representatives continued to be non-committal. Regional Director, RBI, Mumbai J. B. Bhoria was present for the meeting along with Ms. Anshula Kant, SBI’s General Manager, Regional Head Office, Mumbai.................
VITALINFO - Philosophically speaking............
Hearty congrats, Mangesh. Tributes are pouring in for your efforts in bringing out VITALINFO and you richly deserve them. I also agree that it should continue to be your baby and let not any official agency have any sort of control over it. The present coverage is good and comprehensive enough. In fact, to be frank, I am not able to see all the items in full on all days as it is not advisable for too much energy and time (even if there is time) of seniors to be spent on Internet. The point made by Shri Seshan is borne out of anxiety that this sort of an useful Newsletter should continue. But then, philosophically speaking, there is an end to everything in this world when its time is over !
A.Chandramouliswaran, former Executive Director
The FM and RBI - Dr.T.V.Gopalakrishnan
......RBI is the saviour of the economy to a great extent with its’ tight and also flexible monetary policy is what is to be accepted and appreciated. Even then the present stability of the financial system and monetary system cannot be said to be as comfortable as they were a couple of years ago. This should be the worrying factor both for the Govt and RBI at this juncture.
Read...........
Who will decide the new RBI Governor
Who will decide the new RBI Governor ? PM Manmohan Singh, Finance Minister P Chidambaram, C Rangrajan Chairman of PM's Economic Advisory Committee or Montek Singh Ahluwalia Vice Chairman Planning Commission?
Source..........
Source..........
The dilemma of coin shortage
............ The coin shortage is also posing problems for the businesses. In some cases, as in Kolkata, shopkeepers have been purchasing coins from beggars at a premium! On the flip side, large number of coins are lying unused in the donation boxes of temples. The RBI needs to formulate a policy to bring these back into circulation. Due to rising costs of minting the RBI has been reducing the size of the coins. Thus the new one rupee coin resembles like the 25 paise. On the other hand, it has become extremely difficult for people to distinguish between the new two rupee coin and the old one rupee as both of them look identical.....................
RBI detects fake currency, complains to police
PANJIM: The Reserve Bank of India, Navi Mumbai has lodged two separate complaints with the Economic Offences Cell of Goa Police after finding fake currency amounting to Rs 4,300. In the first complaint, Assistant Manager RBI V I Saunchu complained that prior to April 2013 unknown persons deposited 12 forged Indian currency notes at State Bank of India Treasury Branch, Panjim and SBI Mapusa Branch. “RBI Belapur Navi Mumbai found that these notes were counterfeit,” the complainant said. The police said that the complaint states that eight notes of Rs 100 denominations, three of Rs 500 denominations and one of Rs 1000 deposited in the two banks were fake. Another complaint filed by Manager RBI, Belapur in Navi Mumbai L Bagwan alleged that one note of Rs 1000 denomination deposited at Bank of India, Patto Branch in Panjim was detected as fake.
Police have registered the two cases under sections 489-A and 489-E of the India Penal Code.
Source - Herald, Goa
Police have registered the two cases under sections 489-A and 489-E of the India Penal Code.
Source - Herald, Goa
Obituary
Shri.D.G.Borkar died on July 2, 2013 in Mumbai. He was 90 years old. Borkar
was one of the veteran officers of the Economic Department in the
halcyon days of Chandavarkar, Narasimham, Khatkhate and Bhatt. He was a
tough disciplinarian. He gravitated to I F D and from there moved on to
become Joint Chief Officer in D B O D, Hyderabad. He used to contribute letters to Times of India on economic and banking matters. He was a close friend of mine and read scores of books given by me -- especially those relating to R B I.
Smt. Vaidehi Sreeram Deshpande (nee. Vijaya Chandwadkar) expired on
June 30, 2013 in Pune. She was ailing for the last 3 months.She
leaves behind her daughter and husband Shri. Sreeram Deshpande, also
from the DEAP. Smt.Deshpande was one vivacious personality and extremely popular and had a wide circle of friends.
- P.P.Ramachandran (via e-mail)
Banks choose CBLO market over RBI's liquidity window
Taking benefit of low interest rates, some banks on Wednesday preferred to tap the collateralised borrowing and lending obligation (CBLO) market over the Reserve Bank of India (RBI)'s liquidity window..........
First Women Cooperative Bank in Jammu soon
......... the J&K Women Credit Cooperative Ltd has already applied to the RBI for permission to setup first women cooperative bank in Jammu. The J&K Women Credit Cooperative Ltd has been already advancing loans to its women members for setting up business ventures, to become economically self dependent. The J&K Women Credit Cooperative Ltd has so far advanced rupees three crore seventy six lakh to its members for the purposes...........
Read...........
RBI puts on hold debt private placement rules for NBFCs
The Reserve Bank of India said on Wednesday it would hold off implementing a notification issued last week that mandated a minimum wait of six months between two private placements from a non-bank financial firm. Instead, the RBI said a decision on "the appropriate minimum time gap" would be taken by the central bank "in due course," after the industry raised some concerns about the measures.........
Indian rupee's descent isn't over yet
.......Some bankers and analysts feel the RBI has remained a mute spectator to the rupee's steep fall. "The RBI's hands are tied," says a banker on condition of anonymity. They say the RBI should have strongly intervened in the foreign-exchange market to support the local currency. The central bank's stated position is that it intervenes in the foreign-exchange market only to reduce extreme volatility and not to defend the rupee at any particular level. Deputy Governor H.R. Khan said in late June the RBI will take all necessary steps to protect the rupee. Still, the RBI has sold dollars on several occasions to prop up the local currency. This is evident from a fall in India's foreign exchange reserves...............
'Illegal' penalty by banks challenged
......Petitioner Sunil Khare claimed that due to neglect by RBI, various banks have forcibly recovered a staggering Rs3,000 to Rs5,000 crore in the name of penalty for non-maintenance of minimum balance. The petitioner added that only SBI discontinued this practice in April last year, but only after collecting about Rs1,500 crore. Citing a research conducted by him, Khare said most of the banks, including public sector, are charging penalty ranging from 80% to a whopping 365% per annum.........
Inoperative Accounts / Dormant Accounts and Unclaimed Deposits
....However, it may be mentioned that some banks had certain internal guidelines / periods before an account can be termed as dormant and / or inoperative. Bankers needs to check their internal circulars for this purpose, but the above period of two years is applicable as per RBI guidelines. Therefore, as per RBI guidelines, there is no difference between dormant accounts and inoperative accounts..............
Card Frauds --- RBI to be blamed......
The recent spurt in frauds involving credit / debit cards is a sad
reflection of the regulator. RBI has failed to ensure adequate security
to card holders. Card issuing banks do not care much to the directives
from RBI. This is a fact I have observed many times. The latest
directive to issue or replace existing cards with chip embedded features
is yet to kick off. In USA even for a transaction of one dollar, one
can swipe his card. But here in India, most of the merchant
establishments ( point of sale) charge 2% over and above the transaction
value . The RBI totally failed to stop this. On one hand our country
prints very high volume of currency notes and to ensure its distribution
to all regions of the country, we have a huge administration. To
constantly withdraw the soiled notes, we have high tech mechanism. This
is really ridiculous to say the least. We need to change the existing
policies, both RBI and Finance Ministry. We know in real estate
transactions, the buyer and seller never indicate the actual transaction
value in the title deeds at the time of registration. Money changes
hands in the form of cash (black money). This way more black money is
generated. Cant we have some system of transferring funds through banks
by the Sub-Registrar's Office ? Govt., / RBI should pass orders to stop
using cash beyond a limit in any transaction, say Rs 10,000/-. Only
using cards one should transfer funds. Necessary legislation may be made
in this regard. But I wonder whether any one cares ?
- P R Raghukumar, EXRBITES Group
Service before service charge
This refers to the welcome directive by the Reserve Bank of India ( RBI) rightly requiring all the banks to have a uniform and transparent system of levying service charges, regardless of where the service is being availed. The department of financial services should take a further step by ensuring common and uniform rates of service charges and interest rates at least, for all public sector banks. Banks can compete by offering better service, rather than on rates of service charge. The merger of smaller public sector banks into some larger public sector banks will largely reduce overheads.
- Madhu Agrawal (FPJ)
PSU banks to hire 50k employees this fiscal: Chidambaram
........"This year public sector banks are expected to add 10,000 branches of which 2,000 are to be by Regional Rural Banks. Correspondingly there will be recruitment. In fact all the banks put together are expected to recruit some 50,000 persons in the current year,"...........
Bankers sing FM tune, agree to cut interest rates
............Chidambaram said banks did say that the room to pass on RBI’s repo rate cut was restricted. “Nevertheless all assured me they would review their base rates in July and take appropriate decisions. Reduction in rates will be a powerful booster to the economy and credit growth,”.....
Banks to focus on top defaulters: Chidambaram
........“You focus on the top defaulters, as well as keep on eye on the top performing accounts... They are keeping a close watch on the top 30 non-performing accounts in each bank and action will be taken on the defaulters,” ...................
Are Banks the New NPAs?
Apropos
the report ‘Marquee Names Lining up to Enter Bank Street’ (ET, Jul 2),
it’s surprising that corporate entities such as Reliance Industries and
Mahindra & Mahindra have not shown interest in a bank licence. In
fact, Mahindras pulled out citing inflexible RBI guidelines. With so
many riders, banking business in India is no longer attractive. The
companies that would soon be blessed with banking licences would regret
their decision to enter the field. Barring a few private sector banks
such as HDFC Bank, most players are itching to get out. The regulatory
condition on financial inclusion for the new entities has no meaning and
will not be helpful to the rural folk. A few public sector banks that
celebrated massive financial inclusion within a few days of opening new
branches have seen massive dormant accounts in their books. Reason:
banks do not know the art of making money from rural lending.
- K V RAO, Bangalore (ET)
- K V RAO, Bangalore (ET)
Issues over Kumar Mangalam Birla's role now at RBI
With a company in the Aditya Birla Group a strong contender for a new banking licence, the presence of its chairman Kumar Mangalam Birla on the board of Reserve Bank of India (RBI), the deciding authority, has raised concerns over the fair and transparent selection process.................
Shadow warriors
......The RBI is using the new licenses to further its agenda of financial inclusion. It is indeed strange that while two out of three Indians have mobile phones, only one in three has a bank account. Inclusion, though, could become costly for the taxpayers if it is achieved with weak banks.............
Stop, Look, Proceed
.......Going by the high standards it has set, the RBI may ultimately grant licences to only half a dozen or so of the 26 applicants. Such a stance is probably justified, keeping in view the public deposit-taking of banks, whose failures have systemic implications that are wider than for most other industries. These concerns have assumed far greater significance in the post-2008 global financial crisis era............
“Deep Pockets” need not be the sole criteria for Bank licenses
.............I therefore urge RBI to ring fence itself from political influences and ensure that licenses are granted only to the deserving candidates who while meeting the capital needs prescribed have a “Social Objective” to serve the community and have the ability to mobilize savings and deploy funds at the grassroots level. If not, the new licensees will become one more problem in the Indian society.
Read...........
No preferences, no govt say in issue of bank licences: FM
....."There is no preference. All the guidelines have to be satisfied ... Government will have no say in the selection of the applicant who will get a bank licence. We are not entertaining any sifarishes (recommendations) of the applicants,".......
Licence to be cautious
........... It would be difficult to deny them entry into banking, while allowing someone who has no comparable experience to set up a bank. But have the concerns about related party transactions gone away? Certainly not. If corporate entry is inevitable, the only way to allay such concerns is for the RBI to ensure that its supervisory capabilities are up to the task of preventing such practices. The recent revelations about widespread violations of know your customer (KYC) norms by some banks certainly raise some questions about supervisory effectiveness. The RBI must make explicit how it plans to restructure its internal systems and resources to be able to deal with these new challenges...................
Bank hopefuls stare down road fraught with cost, risks
.........“You have to be profitable at the same time. If you have a bank which has losses for seven years continuously, nobody will put their deposits there.”...........
RBI, Pick Widely-Held Cos for New Banks
........regulation
is supposed to prevent and detect such behaviour. Second, when a bank
becomes fragile, a “resolution corporation” (e.g., the US FDIC) is
supposed to seize control, and sell off or shut down the bank. In India,
we have problems on both fronts. Banking regulation and supervision is
weak as the RBI is beset with an array of problems. The resolution
corporation does not exist. The problems of ownership, governance and
compensation should be seen as one unified question............
Aspirants to banking licences hardly inspire confidence
.........Looking at the list of aspirants it appears, as though, everybody wants to try their luck in this once in 10-year jackpot. However, given the time constraints and the quality of applicants, it would be interesting to see if any new licence is given before the general election.
In rural Orissa, it’s the bank that will come visiting
..........."As these people can't come to the bank due to the absence of communication facilities, we thought of taking banking services to the tribals through mobile ATMs. Under the project, the farmers can deposit their surplus funds and avail of finances through mobile vans where a small counter and an ATM will be installed. The mobile ATMs would also enable the government to pay MNREGS beneficiaries, give scholarships to the children of Kisan credit card holders, disburse old-age pensions, and compensate farmers for losses due to natural calamities. The new banking system would also facilitate direct cash transfer for subsidised gas users," ..........
TAKING BANKING ACTIVITY TO STUPID LENGTHS
........Many bureaucrats in Ministry of Finance, top officials of RBI and CMDs and EDs of banks are under the mistaken notion that any monetary transaction may be included in banking service and banks may engage themselves in such activities, provided they are legal and profitable. Everyone including the banks failed to see the distinction between finance and banking. In course of time, the banks who must be the guardians and catalysts of an economy have started playing the role of a servant of all others in the society. Is a banker reduced to a mere accounts-keeper for all sections of the society?...............
Businessman murdered in Devarajeevanahalli
...........According to police, Mr. Huda was giving gold loans and running chit funds. He had deposited huge sum of money in Amanath Co-operative bank, withdrawal from which has been restricted due to orders from Reserve Bank of India. Police suspect that Mr. Huda may not have been able to return the money to his depositors and this could be the motive behind the murder...........
Carat and stick approach yet to dent gold rush
The government’s efforts to reduce consumption of gold have not yet made an impact on the gold buyers in Kerala. Though it is too early to draw a conclusion on the consumption pattern, market men see little scope for turning people away from the lure of gold......
After 28 months, UTI finally gets MD in Leo Puri
Mumbai: Leo Puri on Wednesday became the first non-IAS officer to lead UTI Mutual Fund, which has been headless since February 2011 after then chief U K Sinha moved out to head SEBI...........
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