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Tuesday, July 9, 2013
Lobbying for the next RBI Governor
My View on "Arvind Mayaram, Raghuram Rajan in fray for RBI Gov..."
The choice between Raghuram Rajan and Arvind Mayaram is crystal clear.Apart for one thing in common, the word Ram(Random Access Memory or our Maryada Purush Ram), there is nothing common between the two. Rajan is privy to Global EcoSystem, has worldview like Ben Bernanke and full of innovative ideas. Arvind Mayaram is conservative (cannot be otherwise being an official from a hidebound bureaucracy which excels in precedences and looks to politicians of the day for guidance),familiar with Sikar, Barmer, Jhunjhunu, Jaipur etc; walks on dotted lines,risk averse and not known to chase predetermined fiscal targets in a time bound manner. The selection should be thrown open to a wide spectrum of players and not confined to a narrow pool of IAS.His main qualification is being touted as being from IAS, he will coordinate better with Ministries of Commerce,Foreign Trade and other organs of Government, manned solely by IAS. Is Ben Bernanke,who has move from fiscal stimulus to quantitative easing, a product of bureaucracy? No. He was a tenured Professor at Princeton University who applied latest economic tools to revive $15000 US economy.Why we cling to traditional monetary tools coupled with political nature subsidies to revive $1800 economy and still have the gall to say we are third biggest economy in the world.
Why our DGs are being trashed that they have no administrative skills e.g.Sinha, H.R.Khan,
- Sitendra Kumar
Applications invited for the post of Chairman, NABARD
Government appoints top PSU bank executives
The government on Monday made three top appointments for public sector financial firms. S K Jain has been appointed chairman and managing director (CMD) of Syndicate Bank, Rajiv Rishi as CMD of Central Bank of India and S B Mainak has been appointed as MD of Life Insurance Corporation of India (LIC)..........
Govt proposes to fix tenure of PSU chiefs
.......“In the absence of succession planning, highly competent officers in CPSEs (central public sector enterprises) are many times not left with two years or more of service when posts of functional directors/CMDs fall vacant. As a consequence, CPSEs lose the benefit of getting this pool of talent to occupy the deserving board level posts. Quite often, these competent executives lose their motivation while serving for rest of their tenures,”.............
ICICI Bank trains women staff in self-defence, ensures safe travel
MUMBAI, JULY 7: Security for working women remains a concern in most cities across the country. Taking serious note of this, the country’s largest private sector lender, ICICI Bank, has initiated additional assistance and support to its women employees after working hours. Last month, ICICI Bank implemented some measures for women by setting up a team to conduct self-defence training, monitoring their travel after working late and organising quick-reaction mobile vans to handle emergency situations. Women constitute about 25-30 per cent of the bank’s workforce. At present, ICICI Bank has 17,000 women employees, including probationary officers.........
My View on "Birla should quit RBI board for sake of legacy"
It is Mr Kumara Mangalam Birla who chaired the SEBI Committee on Corporate Governance. To uphold the good principles of good governance, he should have quit the RBI Board on the day he applied on behalf of his company for a license to open the Bank to the RBI. Even if the license were not to be granted, it would be wise to honorably quit the Board of RBI. The RBI on its part would do well not to send any Board papers to him just because he is still ornamenting the Board list.
- Yerram Raju
Women entrepreneurs may see a future with this bank
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............While male employees would also be hired for running the bank, but to make it empathetic to the needs and aspirations of its target customer base, it is expected to be headed by a woman. However, who will head the bank is still a unclear. Officials said that though a number of candidates — all of whom are women — have been identified, a final decision is yet to be taken and can be expected only after clearance from the Union Cabinet for the bank. However, don’t expect the bank to offer any concession rates to women customers. Finance ministry officials have said that it will function purely as a commercial bank and follow the RBI’s guidelines. Apart from regular banking facilities, it is also likely to tie up with state-owned financial institutions and offer pension and insurance products...........
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Unions oppose entry of new banks
..............“UFBU is of the opinion that public sector banks should be further strengthened and expanded to play their pioneering role to meet the present day challenges to our economy” statement added. “In the entire world, the mix up of business and banking had been an unsuccessful model” UFBU said in its resolution. “We are concerned that the Reserve Bank of India and the government are trying to hurry up the process of opening up the banking sector to all types of private interests including foreign direct investors” UFBU said. India today needs strengthening of the public sector banking with further social orientation, rather than encouraging the profit oriented private sector banking according to UFBU. It also called on the government revisit the policy of banking sector liberalisation...............
Bank on hope
The Reserve Bank of India is the mother of oligopolies. It loves government banks, knows that they are not much good at serving their customers, and has done its best to protect them from competition. But it is almost 10 years since it gave out the last bank licences. The common man may complain about lack of banks, but he hardly matters. But then, the prime minister, who once was governor of the RBI, ordained that the numerous subsidies that his government gives its chosen common man be paid in his bank account; it was then discovered that most common men had no bank branch within even driving distance. His government’s banks had counter clerks with children in good city schools; they did not want to go and serve the common man in fly-ridden villages.............
Personalization of banking: Woes of bank customers
Though the banks claim to be taking particular care of senior citizens, the ground reality conditions are far different
.........The other perennial problem faced by senior citizens is the lack of uniformity in the tedious issue of Tax Deductions at Source/TDS on the interest credits. The branches ought to hand over the “No tax deduction request” forms religiously in March each year to make them effective from the following accounting year essentially for monthly credits from April onwards. The declarations should be collected and earmarked. The gross interest earned has to be first credited and the tax deducted debited at the same time..........
LawMin to decide whether Aadhaar's e-KYC is valid
.....Several months after it was launched with much fanfare, the ambitious plan of the Unique Identification Authority of India, or UIDAI, to substitute physical verification with electronic know your customer (KYC) authentication as a means to provide government services, including opening bank accounts, is yet to take off. Reason: There are still doubts on the current legal sanctity of the proposal..............
Read | Business Standard
Account statement must be provided for free
The banking regulator has repeatedly instructed banks not to force periodic ‘statement of accounts’ on savings bank customers who prefer the passbook facility. Yet, some banks are neither listening to their customers nor the regulator. If you see the latest Master Circular on Customer Service, issued by the Reserve Bank of India (RBI) last week, there is a clear instruction to banks to offer pass book facility to all its savings bank account holders (individuals). “A passbook is a ready reckoner of transactions and is handy and compact and as such, is far more convenient to the small customer than a statement of account,” the RBI says........
Banking to be easy at home, away
...........According to RBI officials, the earlier regulatory prescription that 'charges should be reasonable' had not achieved its purpose and proper pricing of these basic banking services, especially for lower category of customers, had not been addressed. With the introduction of CBS, it was expected that customers of banks would be treated uniformly at any sales or service delivery point. "Some banks were discriminating against their own customers on the basis of one branch being designated as the 'home' or 'base' branch where charges are not levied for products/ services and other branches of the same bank being referred to as 'non-home' branches where charges are levied for the same products/ services," the RBI said........
Credit Information Companies: Seeking New Frontiers
........RBI has been rather proactive in adopting some of the global best practices of positive data sharing right from the inception. Even mature bureau markets like Brazil and Australia have started witnessing a move towards a limited positive data sharing environment only as late as 2013. Several other jurisdictions have also started evaluating the possibility of increasing the scope of credit reporting...........
Global Regulator may Simplify Bank Rules
The
world’s main bank regulator may simplify a mass of new rules coming in
for the industry, a sign that watchdogs are still grappling with how
best to keep banks in check nearly five years on from the financial
crisis. The regulator, the Basel Committee on Banking Supervision, on
Monday published suggestions on how to simplify its new regulations
after an internal review of whether the rules, designed to safeguard the
world’s financial system, had become too complex............
Read - ET
Read - ET
Financial inclusion: Rural credit architecture needs an overhaul - M.G.Warrier
........Rise in rural deposits and urban credit created imbalances and certain bypass routes were allowed for banks to achieve their priority lending targets. Like Mutual Funds (MFs) investing in schemes of other MFs to pair risks, banks started searching for other intermediaries like microfinance institutions (MFIs) for providing credit to small borrowers. MFIs, in some cases borrow from banks at low rates and lend at up to three times the borrowing rates, in the same area where bank branches function. So as long as banks source rural deposits, they should also shoulder the responsibility of providing credit in rural areas at reasonable interest rates. The situation calls for a review of the entire rural credit architecture for an overhaul.
Present economic Situation and IMF loan - Dr.T.V.Gopalakrishnan
.......The Financial System has to be given a facelift and the initiative has to come from SEBI to attract NRIs to Indian market in a large scale.Better to avoid foreign debt particularly IMF loan as it may have its own baggage to be taken care of and that also will affect the masses. Any measures without taxing the ordinary masses are welcome.
Ganesha coins minted in Germany, issued from Africa!
India’s RBI Said to Discuss Dollar Purchases With Biggest Buyers
..........The central bank and the refiners are exploring the possibility of mandating a single state-run bank to sell dollars to the companies, eliminating bids that fuel speculation in the rupee, the person said, asking not to be identified because the matter is confidential. Another option is for the RBI to sell dollars directly to the oil companies, the person said..........
The fall spells more trouble
..........The RBI, which has warned of upward risks to inflation on account of the rupee weakness, has kept on hold its indicative policy rate in the last June 17 policy meet. “We are afraid it may be forced to hold on to its rates even in the coming policy also if things do not improve on the rupee front. This, in turn, will further dampen investor sentiment and hurt stock markets,’’ the report added..........
Managing the rupee fall
...........In other words, the government should let the rupee depreciate. A falling rupee is not a hit to national pride - it is merely a basic economic consequence of India's struggle to pay properly for its gold and fuel imports, and the invisible hand's way of counteracting that demand. It is precisely because the rupee is falling that the danger of a serious balance-of-payments crisis is not even more acute than it already is. The trouble is that some companies that have considerable external exposure will find themselves unable to cover their dollar debt. Again, given the nature of India's political economy, there will be pressure on the government to somehow bail those companies out..............
The rupee's wake-up call
...........To dampen the additional inflationary pressures implied by a weaker rupee, more aggressive fiscal retrenchment is needed. Even so, a depreciated rupee will increase the burden of repaying foreign debt, and deepen the woes of domestic companies and banks.
To reclaim its promise, India must foster a new generation of productivity growth. The time for action is now. Unfortunately, a serious crisis may be required to initiate that response.
The weight of a sinking rupee
.....With the rupee having lost 9.27% so far this year and little sign of the trend reversing amid overall economic gloom, we look at how India is doing on various indicators and what’s likely to happen............
Boost Economy, Rupee will Revive
........Once
markets are thus encouraged to respond to fundamentals rather than to
foreigner whim, the positives of US recovery for India will filter
through. If the government stops merely monitoring project
implementation and starts sacking non-performers instead, public
investment would revive as well...........
Read - ET
RBI is likely to pause in July review of monetary policy: K Harihar, FirstRand Bank Ltd
............ In fact, the former Deputy Governor of the Reserve Bank of India, S S Tarapore, who is very well respected, he in fact urged that the rupee's real value, fair value should be something quite alarming at 70 to the dollar and while we might not go up to 70, is there a case for allowing the rupee to weaken further if only to restore competitiveness?...........
Hedging surge prompts central bank inquiry on rupee moves
The Reserve Bank of India (RBI), concerned about the fastest growth in currency derivatives trading in a little over three years, is asking foreign funds to prove they were not speculating on the rupee. Futures and options trading involving the currency rose 47 per cent to a daily average of Rs 38,770 crore ($6.4 billion) in June on the National Stock Exchange of India, the biggest jump since January 2010............
Read | Business Standard
Bank loan recasts top Rs. 2.5 trillion
.......Large-scale restructuring of loans given to firms began in the aftermath of the 2008 global financial crisis. A liquidity crunch that followed the crisis and the slowdown in global markets affected companies in India too, forcing banks to recast loans across sectors such as textiles, real estate, power, and gems and jewellery. About 10-15% of the loans restructured then are believed to have turned bad. This time the proportion could be higher, said analysts, because RBI has been slow to exit from its tight monetary stance. In 2008-09............
SBI may raise home loan ticket size with likely spread cut
India's largest lender the State Bank of India (SBI) may launch a new home loan product that is expected to facilitate millions of home loan borrowers to avail higher credit limit at a lower interest rate. It is learnt to have already submitted the product proposal and it is awaiting for the final nod from an internal policy making body - CCPPC (Credit Pricing and Processing Committee)...........
SBI launches State Bank Xpress Money prepaid card with UAE Exchange
State Bank of India (SBI) today launched State Bank Xpress Money Card a co-branded prepaid card that can be loaded up to Rs 50,000 with UAE Exchange and Financial Services, for loading inward remittances received under money transfer service scheme (MTSS) of Reserve Bank of India (RBI), on VISA network............
SEBI finally replies to former secretary Sarma on MLM menace
........While the RBI has maintained that the deposit-taking companies does not fall under its jurisdiction, market regulator SEBI tried to rein in such companies in the past under its CIS regulations. However, these companies managed to subvert the SEBI orders and continued to flourish with political patronage. In its reply to Mr Sarma, the market regulator said, “MLM schemes in the nature of money circulation schemes are banned under the central legislation titled Prize Chits and Money Circulation Schemes (Banning) Act 1978 (PCMCS Act) and as such these do not fall within the purview of SEBI”............
Three YES Bank directors not 'fit and proper', says Madhu Kapur family
..............In rejoinders and draft amendments to their petition filed with the Bombay High Court today, the Kapur family has said "defendant numbers 7 (Nanda) and 9 (Srinivasan) do not meet the fit and proper requirement of age criteria of 35 to 65 years, as prescribed by the RBI circulars being relied upon...Both defendant numbers 7 and 9 as per the AGM (annual general meeting) notice are 69 years old."............
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