The Centre has appointed Usha Ananthasubramanian as the first Chairman and Managing Director of the Bharatiya Mahila Bank, the country’s first all-woman bank. She is currently an executive director at Punjab National Bank, a leading public sector lender. Besides a post-graduate degree in statistics from the University of Madras, she also has a master’s degree in ancient Índian culture from Bombay University................
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Tuesday, November 12, 2013
Govt appoints first chief of Bharatiya Mahila Bank
The Centre has appointed Usha Ananthasubramanian as the first Chairman and Managing Director of the Bharatiya Mahila Bank, the country’s first all-woman bank. She is currently an executive director at Punjab National Bank, a leading public sector lender. Besides a post-graduate degree in statistics from the University of Madras, she also has a master’s degree in ancient Índian culture from Bombay University................
RBI for tightening vigil to check revenue leakage
........."Considering the prevalent situation in which public institutions are not performing with optimal efficiency leading to leakage of revenue as well as financial losses, there is an immediate need to strengthen institutional control mechanisms, particularly in respect of banks, financial institutions and PSUs organisations,".........
RBI's independence under threat, says former Chief General Manager
Grace Koshie says proposed changes could give the government greater involvement in the Reserve Bank of India’s operational areas; warns other central banks' legal independence is being ‘altered’...
The Reserve Bank of India (RBI) is the latest in a string of central banks whose legal independence is under threat from proposed or actual changes to its mandate, according to a forthcoming piece in theCentral Banking Journal.
Grace Koshie, a former Chief General Manager and Secretary to the board at the RBI, says de jure independence is a "necessary" condition for independence as a whole, and warns that governments may be impinging upon it in a host of countries across the globe.
In India, the government created the Financial Sector Legislative Reforms Commission to "clean up" the country's financial sector legislation. The commission's proposals would, if adopted, remove the RBI's responsibility for financial stability.
While the central bank would retain its role as India's monetary authority and regulator for the banking and payment systems, the government would designate a new "unified" regulator for the rest of the financial sector. The Financial Stability and Development Council, chaired by India's finance minister, would fill this role.
Moreover, Koshie notes, the commission has proposed that each of the present financial regulators are audited by the Comptroller and Auditor General. Koshie warns this "opens the door" for the governmental body to "look into" the RBI's operational areas.
In her article, Has the crisis dented central bank independence?, published tomorrow, Koshie points to three other central banks whose legal independence is "likely to altered" by recent or forthcoming amendments to their national central bank law.
The Cypriot government is in the process of expanding the Central Bank of Cyprus' board membership to include an additional two non-executive directors. This will tip the balance of power away from the governor and central bank staff.
Koshie believes this change will "seriously undermine the autonomy of the central bank management under the governor" and "increase the role of the government/board in internal staff matters".
She also refers to the Bank of Slovenia where, in August 2012, a string of senior staff members resigned in the wake of changes to legislation governing the central bank. Koshie notes that the government was criticised by both the International Monetary Fund and European Central Bank for its decision.
Moreover, in the US, there are repeated attempts from a group of Republican senators to introduce a bill dubbed 'Audit the Fed'. Rand Paul, a senator from Kentucky, has threatened to hold up the appointment of Janet Yellen as the next Fed chair in an attempt to force a vote on the bill.
Koshie acknowledges that if central banks are to retain their independence, they must adapt to the post-crisis environment. This means correcting their flawed models and perceptions.
"Central banks are back at school, filling up gaps in their knowledge and understanding of complex markets, players and products," she says. "As knowledge institutions, their claims to independence as regulators will depend on their ability to stay up the learning curve."
Koshie outlined a range of initiatives the RBI has taken to enhance its credibility and "stake claim for greater operation independence". These include strengthening its internal research, communicating more proactively with the general public and conducting outreach activities to expose staff to more 'real-world' issues.
VITALINFO - My dearest digital friend : Dr.Yerram Raju
VITALINFO has become a part of the post-Pranayam of my morning life. In one single stroke I see a host of journals, dailies, blogs relating to the financial sector. It is a boon to persons like me who can hardly afford an office library of the kind that Mr Mangesh has been putting. I do not know him personally but he is the dearest digital friend I have today. I wonder at his abilities and acumen in accessing such value at a single place. IT IS A BRAND India should be truly proud of.
– Dr.Yerram Raju
VITALINFO, no doubt is a brand by this
time for genius RBI community to keep a track of developments on financial
front and Indian economy. It has also unique importance from the point of view
of RBI retirees as it gives coverage to the retirees’ issues. I express my
sincere appreciation of services being rendered by Shri Mangesh Tarambale.
– L.R.Parab
Great comments there! You remember, Mangesh, we met in the afternoon
one day in Fort, next to Amar Bldg. I was baffled at the enormous amount of
data that you collect daily before dawn and after editing put it up by seven in
the morning for everyone to read. You also mentioned that you get up at four in
the morning, sift through all the papers, take relevant material and edit and
upload for all of us. This sustained effort is tremendous work, passion,
selfless and enduring. I sincerely and highly appreciate you for this. You also
told me that you go through a nap after all this voluminous work from 4 a.m. to
7 a.m. and then get ready for your daily work at office. This is simply
something stupendous and outstanding and doing it single handedly is really
extremely difficult.
- V.Shankarnarayan, PS to Chairman, RBSB
Could you please include my name in your emailing list. I
came to know about your morning updates through Indranil Chakraborty and
Jayakumar (EA to DG) and it is highly recommended.
- R.Ayyappan Nair, Assistant General
Manager
Department of Banking Supervision,
Bangalore
Bangalore
Root cause of 'yours obediently'
My View on "How government selects bank chiefs":
Issues raised here are relevant for government and public sector in general. Government (some officials and ministers) think they are the owners of PSUs and PSBs (in a way, they are!) and use them for carrying out their agenda and for milking them dry to quench their thirst. Some of these institutions (and government) get the private sector-rejects or retired/retiring government officials at their top who carry out the wishes of their masters in government. It is not that these organizations cannot compete with their private sector counterparts. They will outperform them, if a level playing field in terms of skill, technology, opportunities and autonomy in management (including freedom in managing HR) is assured. But, to make this possible, the selection procedure, at least from middle-management level and compensation package will need an overhaul. Career progression with appropriate provision for inter-mobility within the organization and at higher levels within the sector will have to be planned with the ideal age profiles at various levels and the need for a minimum tenure of 5 years for those who reach that level. The ridiculously low level of remuneration packages at higher levels in government and public sector (including statutory bodies) is the root cause of inefficiency and ‘yours obediently’ approach of these institutions. Even the RBI Governor is not paid a salary which can take care of the normal lifestyle needs in the area where he is given a residence.
- M.G.Warrier
Change we will! Traders use tokens for coins in Belgaum
..... “We have at least a dozen hotels on this road. We traders have decided to accept tokens from other hotels so that the customers are not hassled by soiled notes. The decision on tokens was taken because large numbers of soiled Rs 5 notes were being circulated. This new system has brought about an improvement. Also, since the tokens are made for very small amounts, there is no fear of duplication,” he opined...........
Bank staff miffed over govt’s ‘casual approach’ to wage talks
.........When asked about the AIBEA’s demand, he said it has four or five priorities. For instance, improvement in the dearness allowance compensation, which is now credited every quarter, should be made on a monthly basis and reflect the effect of inflation; there should be provision of housing accommodation for all including new recruits, who are posted in various places; full medical reimbursement should be provided for the employee and his/her family, and there should be better post-retirement benefits such as family pension and gratuity. “And it's not just the package. The job as such should be made attractive, as the profile of the banking industry itself is undergoing a change,” he said.............
Staff retirement: Banks will face severe operational risks
........Stating that the retirement is quite intense at the level of the top executives, he said 82 per cent of top executives in the banking industry will retire during the period. It means a leadership gap at the top management level, and banks are likely to face severe operational risks. He said the retirement of the experienced and committed employees would make way for the inexperienced, young and enthusiastic new ones..........
Left unsaid
.......Thus it came about that it promised in 1994 to give a small window of entry to foreign banks, and allow them to open 12 branches each in a country of over a billion (a figure later generously raised to 20). That is what the Delhi government agreed to; the Reserve Bank of India was even more reluctant to give foreign banks a toehold, because it thought that its daughters, the banks nationalized in 1969, were still too young to face competition from industrial countries’ banks.......
BANKING ON FOREIGN SOIL
........The Narasimham Committee recommendations have given more weight to large Indian banks for presence of bank branches abroad. Even in this scenario, experts feel that such overseas operations should be encouraged to set up locally incorporated entities either individually or in Joint Venture (JV) mode with other banks or overseas banks. This is necessary as potential for growth through enhanced global reach by offering wide range of products is only possible by local ( foreign soil ) incorporations. Depending merely on ‘trade finance’ where margins have stretched besides excessive exposure to Indians only is not a viable business strategy............
Read - Greater Kashmir
Protest against foreign banks’ entry
The Bank Employees Federation of India will hold a dharna in front of the Reserve Bank of India offices at Kochi and Thiruvananthapuram to oppose RBI’s soft approach to the entry of foreign banks into India........
India Post seeks RBI nod to start own bank
Come 2014 and India Post will have its own bank. India Post has applied for banking licence to Reserve Bank of India (RBI) and if all goes well it may get the licence in January 2014. India Post will divide the postal and financial services as part of the arrangement. The banks will handle the banking and financial services for which India Post will hire officials separately..........
The importance of being Indian
Irked by a newshound following up on Murli Manohar Joshi's parliamentary query on the citizenship of the Reserve Bank of India governor, an exasperated Raghuram Rajan is reported to have said, "It is shameful that we spend so much time on such issues. There was a time when India was open, when people didn't really care where a person came from. We sort of incorporated them in what we were doing." He is right, of course. The Indian government has over the years employed foreign nationals and persons of non-Indian origin.........
क्या RBI गवर्नर ने आपको भी भेजा है ई-मेल
.....रिजर्व बैंक ने साफ कहा है कि वह इस तरह के मेल कतई नहीं भेजता। रिजर्व बैंक के प्रवक्ता के मुताबिक केंद्रीय बैंक ने अपनी वेबसाइट और दूसरे माध्यमों के जरिये लोगों को भेजे जा रहे ऐसे ई-मेल से सतर्क रहने के लिए जागरुकता अभियान चलाया है। रिजर्व बैंक के गवर्नर रघुराम राजन की ओर से भेजे जा रहे इन फर्जी मेल में लोगों को उनके निवेश पर ऊंचे रिटर्न दिलाने और जैकपॉट जिताने का वादा किया जा रहा है।...........
Implementation of Rajan panel’s report on states will be suicidal for UPA
........What is worse, the committee’s critics argue, is that its recommendations go against the federal spirit of the country’s Constitution, penalise states that perform well and could create more problems than resolving them. In short, the committee’s recommendations need to be junked..........
Read.....................
RBI must watch large companies using natural hedge to borrow abroad
.......Which is why we would suggest that the Reserve Bank of India (RBI) must come into the picture. There is no guarantee that the so-called natural hedges would stay intact should the US economic slowdown worsen. In such an eventuality, the entire possibility of an optimistic scenario would be thrown out of the window, as was the case in the wake of the 2008 meltdown. The RBI must ask domestic banks to scrutinise if their clients are raising ECBs while hedging their loans properly or taking recourse to natural hedge to keep borrowing costs low in hope that the rupee will not tank below a certain value. It is true that.............
Chidu can Dance Now; Gold Imports may Fall 71% this Qtr
......The drop in gold imports took place
after Reserve Bank of India had said on July 22 that a fifth of the
gold purchases by importers in every lot would have to be exclusively
made available to exporters. Only 80% of the imports could be used for
domestic purposes, and that too for entities engaged in jewellery
business, bullion dealers and banks, RBI said................
Read - ET
Rising bad debt takes a toll on bank earnings in September quarter
Banks reporting fiscal second-quarter earnings on Monday showed a massive increase in bad debt that caused them to post losses or weak profits. Four banks reported their earnings on Monday. The largest among them,Central Bank of India, surprised analysts with a Rs.1,501 crore loss for the three months ended 30 September, against a Rs.330-crore profit in the year-ago quarter, as it set aside more money to provide for bad loans...........
India’s reverse taper
........Which is why, over the past few days, roughly the time since part of the oil PSU demand has been reintroduced into the market, the rupee has weakened. Chances are, as the oil demand gets fully re-introduced, this will worsen; more so since, by the end of the month, the FCNR window also gets closed. In which case, RBI has to use this window to quickly bring in the oil demand and hope that, with increased swap flows, the pressure on the rupee will be mitigated. The government also needs to ...........
Indian rupee, bonds fall as Street fears RBI will reduce liquid diet
.....The rupee took a knock losing 1.22% to end near a two-month low of 63.24 per dollar. Urjit Patel, Deputy Governor, RBI, noted in an interview with a television network that while the deficit was higher than that in September, the fact that it was 50% of that in October last year ‘bodes very well for the trade deficit and the current account deficit and is the most important fundamental factor for the rupee’. Nevertheless, worries that slowing dollar inflows coupled with higher dollar demand in the market from oil companies pushed the rupee lower on Monday.............
‘White label ATMs a boon for banking sector’
.........In fact, the Reserve Bank of India envisages them as a one-stop shop for major financial transactions that will also offer value-added services such as air, train and bus ticketing and third party advertisements, apart from regular features. The white label ATMs will not have branding of any bank...........
Here are all credit card myths you should be careful about
.........The credit card is a very powerful financial innovation, which if not used with care can endanger your financial position. Let go of the above myths to become a more powerful and informed credit card user............
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