......RBI further informed that as per an earlier circular, interest rates offered by banks on non-resident external or NRE deposits could not be higher than those offered by them on comparable domestic rupee deposits. But in order to provide the benefit of exemption provided on incremental NRE deposits with a maturity of three years and above from CRR/SLR requirements, banks have been given the freedom to offer interest rates on such deposits without any ceiling. However, the prevailing ceiling on non-resident ordinary or NRO accounts will continue as it is. These instructions will be valid up to 30 November 2013, subject to review..........
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.
Friday, September 13, 2013
Letter to new Governor by Retirees' Association
...........We
have reiterated that Regulation 5 empowers the Central Board to revise the
pension on the lines of the improvements in Govt. Pension Scheme. Unfortunately
for us, our fears in the matter have come true and even after nearly two years,
Ministry is seeking 'further clarifications and further data”, although HRMD
had many discussions with them and have provided every available information. We
shall be grateful if you will kindly keep in sight the above mentioned facts,
while considering the issue of updation of pension..........
Finance ministry, RBI work out informal arrangement to avoid open clashes on policy issues
........While the recent arrangement does not particularly break new ground — setting interest rates and bank regulation are already under RBI — the government official involved in the process said there was a need to fix the relationship as it had turned "really bad" in the last year of Subbarao's tenure. "Short-term interest rates and monetary policy management have to be strictly within RBI's domain, but financial inclusion agenda is clearly part of the government's political mandate," the official said. This newfound coordination was reflected in the package of measures announced by Rajan at his press briefing. .........
Hyderabad to remain financial capital
Even if bifurcation of Andhra Pradesh is the reality, Hyderabad will continue to be the financial capital of the bifurcated States. The newly created regions will be brought under the jurisdiction of the Reserve Bank of India (RBI), Hyderabad, a regulatory model that is in place in north-east and other States according to a highly placed source at the RBI. While Hyderabad is expected to be the financial capital having monetary and regulatory control, the new regional offices will take up developmental and other activities of awareness post division, according to him........
Financial joke
The Securities and Exchange Board of India (Sebi) recently notified an National Institute of Securities Markets (NISM) exam for merchant bankers. It is one the best financial jokes. Those who are already in the profession before the notified date get two years to pass the exam, while someone appointed tomorrow, with no experience, gets only one year! And both will be answering questions from the same question bank.........
The FII effect - Dr.T. V. Gopalakrishnan
......The fact that FIIs are able to dictate terms to the capital and forex markets since the days of liberalisation, despite the presence of insurance institutions, mutual funds, provident funds, banks and a whole lot of whole-sale and retail traders only reflects the weakness of our markets and these investors. It is time our investors and the authorities frame a strategy to counter FIIs to ensure that some semblance of order prevails in the market. The buy and sell policy of domestic institutions has to necessarily counter that of FIIs...
RBI sets up committee to revise monetary policy framework
...Chaired by Deputy Governor Urjit Patel, the committee will review the objectives and conduct of monetary policy in a globalised and highly inter-connected environment and recommend an appropriate nominal anchor for the conduct of the policy. It is expected to submit its report within three months, the RBI said.......
A temporary spurt?
......Only a part of the reason for the revival of the currency might be the change of guard at the central bank. Raghuram Rajan’s appointment as RBI chief had been greeted by both the currency and share markets. He had, of course, taken some baby steps to restore faith in the currency, withdrawing a few panicky decisions his predecessor, D Subbarao, had taken in his last days at the bank. et, the euphoria over Rajan’s appointment cannot last long. Markets are heartless even at the best of times. There must be some good reasons for the reversal of the slide. One immediate cause could be the growing realisation that the US Federal Bank may not after all undertake the threatened tapering of the stimulus, at least not immediately..........
Finance Ministry seeks RBI view on listing of unlisted companies abroad
...........Seeking the opinion of the RBI governor, a senior finance ministry official has said in the note that the issue of allowing unlisted Indian companies to get listed abroad without a prior or simultaneous domestic listing has been under consideration for a long time and "was recently discussed with RBI and Sebi in a meeting chaired by secretary, economic affairs, on June 27, 2013." ..........
The wrong fears
.......Indeed, it was none other than Dr D Subbarao who said at his I G Patel memorial lecture at the London School of Economics earlier this year that the classical interest-rate defence of a currency might not work in India due to this peculiarity. The outflows of money and consequent 13 per cent depreciation in the rupee that we have seen since July 15 have more to do with expectations of a solvency crisis in the financial sector, rather than interest rate differentials........
Growth, deficit problems not structural: RBI chief Rajan
..In commentary published on the Project Syndicate website, he also drew an analogy between the current bearishness on the country, whose currency has barely recovered from record lows last month, to the fickle loyalties of Indian cricket fans. "A few years ago, India could do no wrong.... Today, India can do no right," Rajan wrote in the piece. Referring to the record current account deficit and slowing growth, Rajan said those "can all be fixed by means of modest reforms."............
RBI keeps subdued outlook for corporate investments
.......The apex bank said that demand conditions continue to be a major factor in driving investment intentions. With a baseline projection of real GDP growth at 5.5% in 2013-14, demand conditions may not improve substantially. While the government has initiated some steps in the recent past to improve the investment climate, results are yet to be visible,” said the RBI.............
SBI - Change in Directorate
..... the Central Government, in consultation with Reserve Bank of India, vide Gazette Notification dated August 29, 2013, nominated Shri Tribhuwan Nath Chaturvedi, as part-time Non-official Director .......
Mani writes to RBI Governor
........In a letter sent to the RBI governor on Thursday, Mr. Mani said the escalation of prices of all essential commodities being experienced in the country now was due to supply side factors and increasing cost of production. The remedy, it seemed, should come from initiatives to encourage the productive sectors.......
RBI to create central repository on large credits
.....Accordingly, it has been decided to use the information supplied by the banks through the return on large borrowers (Form A)...which captures system-wide exposure of individuals and entities having exposure (both fund and non-fund based) of more than Rs.10 crore, for creation of central repository of large credits across banks,” it said...........
Rythu Sangham opposes Bakshi panel recommendations
......He also feared that the recommendations will again force small and medium farmers to approach private money lenders for investment on their crops and urged the State government to convene an all-party meeting including all farmers’ organisations to discuss the issue. He warned the Centre that the APRS would organise protests across the State opposing the RBI's move to implement the Bakshi Committee’s recommendations, if the government fails to withdraw the decision.
Self-regulatory organisations to enforce discipline in MFIs
....“We have had a detailed discussion with SIDBI, Nabard and the Government. We will be recognising industry bodies or entities which will function as SROs,” said Archana Mangalagiri, General Manager, Department of Non-Banking Supervision, RBI. An SRO is a voluntary body appointed by the industry participants to monitor the functioning of all players in the industry and bring in some degree of standardisation in industry practices. Mangalagiri added that the RBI is clear there cannot be multiple regulations for NBFC-MFIs....
ICICI plans to issue 500,000 new credit cards in 2013-14
.... “We are seeing spending growth of 20% or more, varying between Rs.1,300 crore toRs.1,500 crore every month. Our delinquencies are less than half of the industry and 90% of our cards are actively used,” Sabharwal said, adding that ICICI’s delinquencies had fallen “dramatically” over the past few years. Sabharwal declined to give a specific number on the delinquencies citing compliance issues.....
RBI report an eye-opener for Congress: Parkash Singh Badal
CHANDIGARH: Punjab Chief Minister Parkash Singh Badal today said the Reserve Bank of India (RBI) report which has put Punjab among three best investment destinations in India during 2012-13, should be an eye-opener for Congress. ...........
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