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Friday, October 4, 2013
A month of new regime at RBI
A takeover best avoided - Dr.S.S.Tarapore
Forgive them, O Lord, for they know not what they do
Banking has truly become 24x7 locally and globally: RBI
......since technology
speeds up ease of access of customers to service providers, enables easier
communication and possibly also speeds up operations. However, there is an
interesting and contrasting evidence that I choose to draw from one of the
examples adduced by Shri G Padmanabhan, Executive Director in the Reserve Bank
of India, who made a telling comment on the number of mobile banking accounts
that had been opened in India. While the number seemed staggering and really
impressive, a comparison with the number of bank accounts opened in India
revealed that the former was but a relatively insignificant proportion of the
latter........
Read........
Urgent need for RBI to focus on quality and impact of financial inclusion efforts
........When we say (or imply) that financial inclusion would lead to inclusive growth and therefore, the RBI must enhance its thrust on financial inclusion, I would like to transparently understand from Dr Rajan and the RBI as to what is the relationship between financial inclusion and inclusive growth? Put differently, I am yet to understand ‘how access to a savings account or credit bureau or even a loan or some form insurance would facilitate inclusive growth’? ...........
Banks not inclusive enough
.........Are commercial banking (as it is currently practiced in India) and attainment of financial inclusion mutually exclusive? It would appear so if the Reserve Bank of India’s parallel (and somewhat expeditious) movement on two separate tracks — one on the issue of new bank licences in the private sector and another on the development of a policy/institutional framework for attaining financial inclusion/financial deepening in India — is any indication...........
Young f(A)ces..............
My View on "RBI Board May Get Young Faces":
The RBI Board will go places,
If around the table it has a sprinkling of young faces,
For they have up their sleeves many aces,
And are also the one's who can bend & tighten their shoe laces,
The older faces,
Seem tied to their seats with braces.
- F R Misquith
Gandhi Jayanti thoughts: Time for Ambedkar-series currency notes?
.....Imprinting Ambedkar’s image on currency notes also has a symbolic significance. Ambedkar, as of now, is identified mostly as a Dalit hero. No doubt, he is. But Ambedkar was a multifaceted personality. His career as an economist is yet to be recognised and studied. One reason for this could be that the political developments after Ambedkar’s return to India did not allow him devote much time to economics. He was preoccupied with the Dalit empowerment and fighting the caste pernicious caste system. Printing his image on currency notes will go a long way in bringing his contributions to economics back into the reckoning. It will give Ambedkar the position he deserves in the economic history of India............
Banking Mints the Most Women CEOs in India
....“Women
tend to be more conservative, more structured, more careful about
money, good leaders and better team players,” she says. Adds Arun
Duggal, chairman of Shriram Capital and a veteran international banker:
“Banking requires sound instinct and intellectual capability to analyse
businesses. I feel women are better at it than men.”........
Read - ET
India’s Inflation Puzzle
.........In
its latest monetary policy announcement, the RBI has surprised markets
by increasing the repo rate on concerns over inflation. Many experts and
business groups have criticised the RBI as they assert that inflation
is related to supply-side factors — especially in the food sector — and,
therefore, tighter monetary policy will have little effect on it.
Tighter monetary policy will only hurt growth without helping control
inflation. A complicating factor peculiar to India is the multiplicity of inflation rates...........
Classification criteria revised for urban co-op banks
The Reserve Bank of India has revised the criteria for classification of urban co-operative banks (UCBs) as Financially Sound and Well Managed. Among others, the new criteria, which require maintenance of a minimum capital to risk weighted assets ratio (CRAR) of 10 per cent on a continuous basis, would henceforth be considered for processing applications received from UCBs for branch authorisation.........
Biz houses and banks — misplaced worries
Given the sharply divergent views on the issue of permitting industrial and business houses to promote banks, the concerns raised by most of those opposed to the entry of industrial houses in the banking space appear to be misplaced on several counts. This includes the issues raised by Parliamentary Standing Committee on Finance.........
RBI, NABARD decision draws flak
Criticising the decision of the Reserve Bank of India and the National Bank for Agriculture and Rural Development to convert primary agricultural cooperative societies into business correspondents of district-level central cooperative banks, the Tamil Nadu Cooperative Bank Employees’ Association has appealed to Chief Minister Jayalalithaa to intervene in the matter.........
Reject Raghuram Rajan panel report : Chandy
......Expressing his reservations, he said, if the Raghuram Rajan committee report was accepted this would be reduced to just 0.38 per cent. If the Center allocates Rs 1,000 crore to states, Kerala’s share would be just Rs 3.8 crore only. This will hit Kerala’s initiatives on the development front, he added................
14th Finance Commission to visit state from today
A delegation of the 14th Finance Commission (FFC) will arrive Nagaland Friday on a two-day meeting for making recommendations regarding fund requirements of the state for the period 2015- 2020 effective from April 1, 2015. According to a finance department communiqué, the commission members would review state’s finances, deficit and debt levels keeping in view, the fiscal consolidation road map recommended by the 13th Finance Commission. Dr. Yaga Venugopal Reddy is the chairman of the FFC and also a former governor, Reserve Bank of India and was board member of International Monetary Fund (IMF). Dr. Reddy was appointed as the chairman of the commission on January 2, 2013.........
RBI chief Raghuram Rajan meets Finance Minister P Chidambaram; discusses economic situation
....The Central Board of Reserve Bank will meet in Raipur tomorrow to discuss key economic and financial developments. The RBI board meets at least once every quarter. The meeting would be chaired by Rajan. The four deputy governors are the official directors on the board, while Mayaram and Financial Services Secretary Rajiv Takru are the government nominees. There are also 11 non-official directors on RBI board. .....
India to enhance capital infusion into PSU banks
The government Thursday decided to substantially enhance capital infusion into public sector banks to enable them provide cheap loans for two-wheelers and consumer durables to stimulate demand. The decision was taken at a meeting of the top economic policymakers that included Finance Minister P. Chidambaram, Reserve Bank of India Governor Raghuram Rajan and Economic Affairs Secretary Arvind Mayaram............
Taking interest in transparency
..........The RBI guidelines are welcome and, in many cases especially relating to credit card usage, overdue. Transparency in lending is a welcome trait and the authorities should encourage banks to move towards complete disclosure. The directive could, however, deal a deadly blow to consumer durable sales, which generally peak during the festival season, just round the corner. Yet, from an overall perspective, consumer protection is probably more important than a short-term dip in sales of consumer durables,.........
FM, Rajan get behind the wheel to drive festive sales
..........The decision was taken in principle at a meeting between Finance Minister P Chidambaram and RBI Governor Raghuram Rajan. Economic Affairs Secretary Arvind Mayaram was also present. Pawan Goenka of Mahindra & Mahindra met Revenue Secretary Sumit Bose to push for lower tax on sports utility vehicles and lower interest rates on auto loans. Chidambaram will soon meet heads of public sector banks to impress upon them the need to lower interest rates in select sectors........
RBI's welcome departure from convention
...... If this was not a welcome surprise for those waiting for the RBI to prioritise growth, here comes another surprise that definitely would be welcomed with both hands.......
The curious case of the Indian stock market
...........Much to government’s relief, there has been a 77% drop in gold imports in value terms and 28% in volume terms during the quarter ended September 2013 on the back of several initiatives taken by the Reserve Bank of India (RBI). On the other hand, the fiscal situation is nothing to cheer about. The first five months alone have seen the government reach 74.6% of the fiscal deficit target for the entire year’s Budget Estimate (BE)..............
Shashank Manohar brings BCCI war out in the open, blames Srinivasan for flouting RBI norms
.........Surprisingly, past president Shashank Manohar is blaming N. Srinivasan for flouting RBI norms. In an interview given to leading newspaper, Manohar said, "Despite a working committee decision, Srinivasan did not take the RBI's permission and entered into an agreement with CSA whereby they transferred money directly to CSA."..........
Can markets ride out Red October? All eyes on America, Raghuram
......Given that RBI chief Raghuram Rajan has already cleared his stance on inflation, analysts and economists expect further tightening from the central bank. Economists are now split over whether the new RBI chief will hike rates again at the central bank's next policy review on October 29. "Nearly half of economists surveyed, 16 of 31, expect Rajan to leave rates on hold at the meeting, while 15 expect a further 25 basis point (bps) increase, which would bring the policy rate to 7.75 per cent," said a Reuters Poll..........
Gold: villain or saviour?
.........The RBI study, therefore, sensibly advises increased monetisation of gold — to make unaccounted gold generate accounted money. It suggests setting up a bullion corporation for lending against and refinancing gold, and pool and trade in gold stocks. The study commends encouraging gold loans by banks and non-banking institutions. This is what traditional pawnbrokers have been doing for ages. The State began curbing, instead of registering and disciplining, private moneylenders. The hope that banks would replace them has been belied.........
Banks see rise in stress in gold loan portfolio on volatile prices
......."There were serious issues with LTV ratio in the first quarter when gold prices fell. The LTV ratio for many banks went beyond 90%. The current situation is not as bad as prices have recovered in the past few months. But there is no guarantee that prices will continue to remain firm. We are monitoring our portfolio on a regular basis,"........
Loan recast hits roadblock as promoters fail to contribute
.......After companies and banks started taking undue advantage of the debt restructuring process, the Reserve Bank of India (RBI) made the norms concerned stringent by prescribing high contribution from promoters. As on June 30, 549 cases had been referred to the corporate debt restructuring cell. Of these, 92, worth about Rs 40,000 crore, were closed or rejected, against 87 cases worth Rs 37,000 crore in March. The data for September are still been finalised; bankers expect the numbers to rise............
Password hacked, 1.27L stolen from bizman’s a/c
Pune:
In the fifth net banking fraud case in less than a month, a
businessman’s password was hacked and Rs 1.27 lakh siphoned off from his
account. The businessman lodged a police complaint on Wednesday
night, almost a fortnight after he lost the money, on the insistence of
the bank............
Read - TOI
Read - TOI
HDFC bank to double its branches in Chhattisgarh
.........The HDFC Bank sees Chhattisgarh as a potential state. “The state is a key market for the bank as it is shinning state as far as the development and growth are concerned,” Kumar said, adding that the bank is growing at 30 to 40% on year-on-year basis that would continue........
FIR against HDFC Bank, others for cheating retired bureaucrat
Delhi Police has informed a court here that, as per its orders, an FIR has been lodged against HDFC Bank along with unknown persons for allegedly cheating a retired bureaucrat of over Rs 13.6 lakh by making withdrawals from his bank account and also forging his wife's signatures............
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