..........Nachiket Mor, the man who ran the treasury,
corporate funding, and learnt how a retail customer behaves from his perch at
ICICI Bank, will wear the hat of a jury in two key panels constituted by
Raghuram Rajan, the man who told a partying Wall Street that the music had
stopped long ago. “He straddles many worlds,” says Rajan. “We could not pick up
a better and more capable person who has seen all aspects — the theoretical as
well as the practical — to give us a sense of the future of what we should be
doing.” ..........
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.
Wednesday, October 9, 2013
Concern over impending takeover of DICGC
All India Reserve Bank Employees Association writes to Governor............
Also read this........
Can’t change rules midway, process for bank licences won’t be rolled back
........Many are criticising this move saying it will lead to more bad loans, besides leading to distortions. Even RBI Deputy Governor K C Chakrabarty was quoted as saying that it is not prudent to increase consumption by lowering interest rates because if the interest rate goes up, loans will become NPAs. How do you respond to that?
The RBI Deputy Governor was quoted completely out of context. He told me that the answer that he gave was in reference to a theoretical question asked by a student at a function he attended. That, unfortunately, has been taken and portrayed as some kind of criticism of the government policy. It was not............
Achieving financial inclusion
........ It is hoped the RBI takes note of the views of Dr CD Datey, who sacrificed his career to oppose the establishment of RRBs in 1975. The small banks may not serve the purpose of financial inclusion. The Centre should rather think of having small branches of the commercial banks with all facilities of core banking solutions (CBS) which may ensure cent per cent financial inclusion.
Angry Mumbai Schools approach RBI governor
..........."It is a pity to see such qualified sportsmen, who are officers at the RBI, using such foul and abusive language. Even after the cops arrived, they were still behaving violently. I am really upset over the whole incident and hope that the RBI takes stern action against those who were responsible for such behaviour,"........
JOINT MEETING OF RBI, GOVT OFFICIALS HELD
..Among the seized currency notes, there are 903 notes of Rs1,000 denomination, 618 of Rs500 denomination and 44 of Rs100 denomination. Present in the meeting were RBI Chief General Manager, Nagpur, S V Raghavan, RBI General Manager, Raipur Office Nirmalchand, Assistant Inspector General of Police, Chhattisgarh, Sanjay Sharma besides officials from Airports Authority of India and BSNL.
Guidelines For Creating Posts of GMs, DGMs and AGMs in Public Sector Banks
........Based on above guidelines, MoF has calculated the maximum number of General Managers in each Public Sector Bank based on the business mix as on 31/03/2013. The details of posts of GMs is given below based on MoF guidelines. These guidelines will now be reviewed only based on the business mix as on 31.03.2015 and the ceiling provided below shall remain effective till next review. As per MoF circular, it appears that Punjab National Bank, Canara Bank, Bank of India already have exceeded the number of posts at General Manager level. MoF has allowed them to retain the existing number of General Managers.........
Let more Women Rise to the Top
We
welcome the appointment of Arundhati Bhattacharya, the first woman to
steer the country’s largest lender, the State Bank of India. She joins
other women heading public and private sector banks in India, all of
whom have been chosen on merit and performance, and not because of their
gender. But in sectors other than banking, there is a dearth of women
in the senior-most positions. Which is strange and calls out to be
remedied...........
Read - ET
Read - ET
Bhattacharya underlines tech in SBI’s war on NPAs
.....To improve NPA management, SBI will employ more tools than before, with emphasis on effective use of IT. Bhattacharya said IT is going to be used in risk mitigation, product pricing, customer-related issues and in raising productivity. The bank will also ramp up technology to tackle loan recovery. Focus will also be on structure rationalistaion and improved time resolution to fight bad loans...........
No plan to slash lending rates, says SBI chief
.........The new chairperson has also proposed removing the cap of two transfers on ‘spouse grounds’ for both female and male employees. She is also considering introducing a longer sabbatical (leave on loss of pay) for employees, especially women, similar to the scheme she introduced in SBI Caps, when she was heading it. At present, SBI Capital offers leave without pay for up to six years.
Who is Arundhati Bhattacharya?
..............Her elevation came after the glass ceiling was broken in 1996, when Tarjani Vakil took over as head of Exim Bank. Ms Vakil's appointment was followed by Ranjana Kumar, who was appointed chairman and managing director of Indian Bank. Over the past few years, India's banking sector has seen a few more woman heads. Shubhalakshmi Panse, Vijaylakshmi R Iyer and Archana Bhargav are heading state-run Allahabad Bank, Bank of India and United Bank of India, respectively. In the private sector, Chanda Kochhar and Shikha Sharma now head ICICI Bank and Axis Bank, respectively. At the Reserve Bank of India (RBI), Shyamala Gopinath, K J Udeshi and Usha Thorat have all been Deputy Governors............
Appropriate to indicate the facts - K.Kanagasabapathy
My View on "Cash holding confusion - A.Seshan":
Yes. This is a ridiculous practice to say the least. Previously when government's cash balance exceeded Rs.50,000 crore, the amount was invested in government's own securities. Now perhaps the entire amount over and above Rs.100 crore is invested in government's own securities. Even if the government's cash balance is invested in securities and goes into investment account of the central government, the impact on the market of such high balances is the same. It would be appropriate at least to indicate in a foot note that so much amount of cash balance is invested in government securities. The impact of such high balances is technically equivalent to a CRR imposed on the system. Yet another issue is that RBI indirectly pays interest equivalent to interest on invested securities, since the interest on such securities accrue to the government. Since RBI is not paying any interest on banking system's balances on account of CRR, it would be proper for RBI not to extend the benefit of investment of surplus cash balances of the government in its own securities. Rakesh Mohan committee on Financial sector assessment earlier recommended that such surplus cash balances can be lent in the overnight market, since such accumulation of balances cause every time a cash crunch, rather unintended, on the system. On this also, no decision seems to have been taken. Yet another irony is that government continues to borrow heavily even when it has huge cash balances which only precipitates the cash crunch caused by the surplus balances.
Yes. This is a ridiculous practice to say the least. Previously when government's cash balance exceeded Rs.50,000 crore, the amount was invested in government's own securities. Now perhaps the entire amount over and above Rs.100 crore is invested in government's own securities. Even if the government's cash balance is invested in securities and goes into investment account of the central government, the impact on the market of such high balances is the same. It would be appropriate at least to indicate in a foot note that so much amount of cash balance is invested in government securities. The impact of such high balances is technically equivalent to a CRR imposed on the system. Yet another issue is that RBI indirectly pays interest equivalent to interest on invested securities, since the interest on such securities accrue to the government. Since RBI is not paying any interest on banking system's balances on account of CRR, it would be proper for RBI not to extend the benefit of investment of surplus cash balances of the government in its own securities. Rakesh Mohan committee on Financial sector assessment earlier recommended that such surplus cash balances can be lent in the overnight market, since such accumulation of balances cause every time a cash crunch, rather unintended, on the system. On this also, no decision seems to have been taken. Yet another irony is that government continues to borrow heavily even when it has huge cash balances which only precipitates the cash crunch caused by the surplus balances.
- K.Kanagasabapathy
‘FUNDING FOR LENDING’ SCHEME MAY CRAMP BANKS FOR SPACE ON LOW INTEREST RATES
....Though the Government has announced that it will infuse `14,000 crore in PSU banks, allowing them to lend at attractive rates in the festival season, sources pointed out that this move may also not prevent the CoF of these banks to fall short by 0.1 per cent. Analysts too feel that the proposed ‘funding for lending’ scheme may not help banks to lend at cheaper rates..........
Stop criticizing Gov...........
My View on "THE SECRET DIARY OF RBI GOVERNOR":
The tragedy is that every tom dick and harry has either started giving suggestions to the new RBI Governor or criticizing him on policy initiatives he has started taking. Is it partly due to either jealousy or some others and playing shadow boxing. There is clear indication of political overtones in the remarks of the author against a more erudite, intelligent and a more competent person who is a hope for all of us to give true direction to the economy.
- M.K.Bandopadhyaya
Working backwards
.........Committee member Shaibal Gupta has written a long dissent note appended in the report. Gupta, among other things, questions the committee’s decision to assign equal weights to each of the sub-components (such as monthly per capita expenditure and percentage of SC/ST population) for calculating the overall index for the state.........
MSF cut: RBI weakens its inflation-fighting credentials
........After all, it is just over a fortnight ago that the Bank in its wisdom thought it fit to reduce the MSF by 75 basis points, rather than go in for a more aggressive easing on the grounds that consumer price inflation is still high and savings in financial instruments is less than desirable. Has anything changed on either of these two fronts? No! What has changed is that .........
A Consistent RBI Policy
The
RBI has eased interest rate on borrowings under the marginal standing
facility (MSF), defined as an emergency way that banks use when they
face a paucity of funds. The RBI must have a consistent policy to
regulate the money market. Tampering with instruments of credit control
or credit creation measures such as the repo rate, MSF, open market
operations, etc, often will deprive banks of cost-effective and
profit-maximising strategies.
- S RAMAKRISHNASAYEE, Ranipet (ET)
- S RAMAKRISHNASAYEE, Ranipet (ET)
Keep reversing
......This is good news and it will ease liquidity conditions in the market. An RBI committee headed by Deputy Governor Urjit Patel is working on a new monetary policy operational framework. Until the committee makes its recommendations and a new framework is put in place, one may expect that the RBI will move back, albeit slowly, to the framework that existed before mid-July...........
CAD target of $70 bn is imminently reachable: Rajan
"........There is increasingly a sense amongst analysts, amongst commentators that India's current account deficit (CAD) problem is under control. $70 billion that the government proposed as a CAD after calculating it with us seems now imminently reachable. Some independent analysts are saying it will be even better,"........
I’m pleasantly surprised by the economy’s ability to react: Raghuram Rajan
.....What I have said since then and I keep saying is that yes, inflation is a big concern for the Reserve Bank; that we intend to fight inflation. When we fight inflation, however, we keep in mind the state of the economy. Because of the lower level of output relative to potential, we also have disinflationary forces at work. Disinflation is not a one- month or two-month process. ..........
Inflation still biggest bugbear
Duvvuri Subbarao, the former Reserve Bank of India governor, will probably have the last chuckle. On Tuesday, the finance ministry forecast inflation based on the wholesale price index (WPI) at anywhere between 6.5 and 7.2 per cent at the end of 2013-14 — a number that is streets ahead of the RBI’s projection of 5 per cent that was made in the first quarter monetary policy review on July 20. The forecast is also higher than the 5.5 per cent projected by the PM’s Economic Advisory Council headed by C. Rangarajan in its report last month. For over a year, the finance ministry under P. Chidambaram and Subbarao have clashed over the conduct of the monetary policy.........
Raghuram vs America! Street caught in the crossfire
The stock markets seem to be been dancing to the tunes of what appears to be a battle of sorts between US Fed and RBI. What's heard on the Street is that markets are uncertain over what would happen in the US in terms of the ongoing shutdown, debt ceiling and quantitative easing..........
Economy has growth potential, CAD isn't an issue now: Rajan
....“A narrowing fiscal deficit is also something that international investors are looking at. One way to narrow the deficit would be a jump in diesel prices. if that’s not on the table, a sequential increase in diesel prices at a rate that makes us close to market price in the near future is important,” .........
Growth, Low Inflation to be RBI’s Priority
.......After
every RBI action, various government functionaries comment on it. But
this time when you raised repo rate, there were no comments from New
Delhi. How did you achieve it?
Anyway, look the finance ministry and the RBI talk. It has been true since September 4th, it was true before September 4th. We talk and very rarely one side surprises the other... Let me start by saying objectives are the same. Both sides want growth, both sides want low inflation. The pace and the instruments we use to achieve those objectives, there is always a healthy debate and ultimately I think this is true in every country and the whole issue is to try and convince the other side.......
Anyway, look the finance ministry and the RBI talk. It has been true since September 4th, it was true before September 4th. We talk and very rarely one side surprises the other... Let me start by saying objectives are the same. Both sides want growth, both sides want low inflation. The pace and the instruments we use to achieve those objectives, there is always a healthy debate and ultimately I think this is true in every country and the whole issue is to try and convince the other side.......
RBI’s Raghuram Rajan says things will only get better for India’s economy
The news on the economy will only start getting better from now, Reserve Bank of India (RBI) governor Raghuram Rajan said in an interview, reflecting a growing view in many quarters that the Indian economy has bottomed out. He listed the factors behind his assessment: rising exports in the second quarter; the possibility that the US’s problems would be temporary and that lawmakers in that country would arrive at a fiscal deal; stronger agri production; and the revival of many projects that were stalled............
Moneylife IMPACT: RBI asks High Mark exec chairman Anil Pandya to step down
Following several complaints and reports by Moneylife, the Reserve Bank is understood to have directed Prof Dr Anil Pandya to step down as executive chairman of High Mark, the troubled and cash strapped credit bureau. Reserve Bank of India (RBI) is understood to have asked Prof Dr Anil Pandya to step down as executive chairman of troubled and cash strapped credit bureau High Mark Credit Information Services Pvt Ltd. ........
P Chidambaram to reach Washington tomorrow for IMF-World Bank meetings
Finance Minister P Chidambaram will reach Washington tomorrow to attend the IMF/World Bank annual meetings, after which he will meet investors in San Francisco to hardsell India as an investment destination. Reserve Bank of India Governor Raghuram Rajan and Economic Affairs Secretary Arvind Mayaram, among others, will also attend the IMF/World Bank annual plenary meetings on October 11 and 12........
Panchayat-owned ATMs
......To further motivate the banks, panchayats could lease an ATM from the companies and offer wet lease to banks, making the installation of ATMs a reality in a large number of bigger and richer villages..........
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