Govt, RBI shadow boxing must end - DR R. K. PATTNAIK

.........In essence, the approach of RBI to increase interest rates to control aggregate demand and thereby anchor inflation expectations has been at the center of the discord. There are also media reports that the RBI’s policy stance to control inflation may not be appreciated by the new government and there could be leadership change in the RBI. In this context it may be recalled that the election manifesto of BJP has specific action points on inflation management. The resolutions in the manifesto are well deserved steps in handling the supply side of inflation management. To ensure that inflation management becomes credible and sustainable the NDA government may also consider supporting the demand management policy stance of RBI. In the fitness of things, the new government should listen to the RBI and give its due...........

Read - FPJ

RBI and INFLATION: The Chase Begins…

.........The committee appointed by RBI gave suggestion to solely focus on CPI and not on any other indicator. There are many reasons for choosing the CPI as nominal anchor for monetary policy. One of the reasons is that many countries in the world are now choosing this indicator as the base for their monetary policy but India and China. It is easy to track the CPI and even so called ‘AAM AADMI” can also relate the RBI’s monetary policy decision to increase or decrease the rate w.r.t CPI number. But the larger question is .............

Read - The Indian Economist

R Gandhi Deputy Governor Reserve Bank of India at FAPCCI

R Gandhi Deputy Governor Reserve Bank of India, Mumbai speaks on ordinary topic relevant to ordinary public. Gandhi says all are primarily public and then refer to FAPCCI. The ideas and impacts of Gandhi explains why they bring certain resolution from Reserve Bank of India. The National Brand and other difficulties are faced by the common public when they first addressed. After finishing them they kindly react to the ideas and they really put them. Gandhi thanks Ayyadevara and Prasad. Gandhi says Know Your Customers is not a reason phenomenon. The concept of Banking Industry is focusing on the essence of them knowing the customer that has been practiced by Bankers from day 1. Banks focus more on Asset not on Liability side as no banker takes risk and parts from the Bank to an unknown person. When a Banker lends money to the party then there is interest list, trade and individual. Know Your Customer assessment is nothing but finding employee the way they can assess of how far the money comes back from creditor’s assessment. This is nothing but Know the Customers Assessment. Gandhi speaks on the safety and soundness of banks.

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Fake website of RBI

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Where Duvvuri Subbaro grew up

..........According to the family friends of the former chief of the apex bank, his father late Duvvuri Mallikarjuna Rao, who worked as Assistant Public Prosecutor in the city courts, lived in a rented building in the same area before he purchased this house. Later, it was named as ‘Mohan Manjal’ in memory of one of the Duvvuri’s family members. The family of nine members lived in the house until Mr. Subbarao’s father expired. Later, it was sold to a city-based medical practitioner to become a hospital. It became a restaurant after it changed hands again.............

Read - The Hindu

Former RBI Governor Dr Subbarao and Chinese Business Tycoon Mr Wang join NUS B school

...Dr Subbarao will be delivering a series of lectures on central banking challenges co-sponsored by the MAS.  While three lectures will be held at the NUS B School on May 30, one will be at MAS on June 2, 2014. Speaking on the occasion Prof Bernard Yeung said “We are deeply honoured to welcome Dr Subbarao to NUS Business School, one of Asia’s leading business schools. As former Governor of RBI and Finance Secretary, Dr Subbarao led India through some of the most challenging times in the country’s economic development. I am confident that our faculty members, students and community will benefit immensely from his insights and knowledge. We look forward to his lectures,”....

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India Post needs to apply afresh to Reserve Bank of India for bank licence

India Post will have to apply afresh to the Reserve Bank under differential licence guidelines if it wishes to start banking operations. According to sources, aspirants, including the Department of Post, will have to apply once again after guidelines on differential bank licences are issued in the next few months....... 

Read - ET

Interference in public banks

.....There are many reasons for this delay - interference from the Central Vigilance Commission (CVC), Right to Information (RTI), and political interference. There is an urgent need to look at these matters, so that the decision-making can become smoother. On the other hand,.............

Read - BS

The importance of being independent - Janmejaya Sinha

........However, the one issue on which I disagree with the committee is the structure of its solution. It is surprising that the committee did not stay with the analogy of Axis Bank, but went on to create what I believe is an unduly complex and unnecessary solution of a bank investment company (BIC) and a bank boards bureau (BBB). Both may lead to the creation of the same problems that the committee seeks to avoid. Why do we want to shift all government holding into a central bank investment committee? Why can't these banks be allowed to operate like other banks? The nomination committee of the board will pick the CEO and compensation will be market-based. When we can allow independent banks with independent boards to run their banks, all we need is that the government stake be brought below 51 per cent. I think it is simpler and more effective, after...............

Read - BS

Nayak panel stirs up a row

......Government interference has meant that policy objectives rather than commercial considerations dictate a PSB’s working. A less charitable way of saying is that it is because of government pressure that several PSBs have lent to unbankable companies. Not all the worryingly high non-performing assets that banks are saddled with are due to government interference but if banks had decided on purely commercial considerations, they would most certainly had been better off.............

Read - The Hindu

Directors - The weakest link?

........the crux of the problem is how directors are appointed or how they manage to get appointed on the boards of banks. There seems to be a lack of basic skills analysis of directors. Are they competent to join the board is a moot question. It is well-known that ................

Read - BS

Prepayment penalty on floating rate loans may come back

........... However, this position could be reversed if the recommendations of the working group set up "to examine the issues related to discrimination in pricing of credit and recommend measures for transparent and appropriate pricing of credit under a floating rate regime" are accepted. Unfortunately, their recommendations, if implemented, are unlikely to result in a fairer regime. In fact the recommendation, if accepted, might lead to a more unfair regime..............

Read - BS

Banks urged to conduct coin melas

....Vice-president of Coimbatore Consumer Cause M. Govinda Rao says that the RBI should ensure that banks organise special camps regularly, even once in three months, to distribute coins. Banks should also ensure that coins are distributed to customers regularly so that there is no shortage in coin availability.

Read - The Hindu

Where will it settle?

......A halt at this level will mean that the rupee could remain in the band between 57 and 70 for a few years as it consolidates. But such a move will keep open the possibility of a move below 70 over the long term. The RBI has also made it clear that it does not want to ward off rupee depreciation. It is only volatile movements, with depreciation happening over a short period, which it wants to avoid. If the rupee gets past the hurdle at 57, the next resistances are at 54 and then 52. We do not envisage a move above 52, even if copious inflows enter the country. ......

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Awareness welcome, but Redressal sought for

My View on  "Meet to spread awareness of banking ombudsman sche...": 

Creating awareness of banking ombudsman scheme is welcome. But, sadly, those who are aware about its existence and waiting for redressal of their grievances is a larger issue as absolutely no response from the ombudsman on complaints already recd by them. One case in point is that a complaint lodged by one of my relatives servant on 20 March 2014 for non receipt of credit of a cheque for Rs.63,723 issued on SBI Ratnagiri branch and deposited in the SBI Andheri West branch. The bank has not credited the amount of the cheque deposited on 13 March 2013. It is more than one year that no action has been taken by the bank despite visits after visits and letters after letters given to them. Ombudsman at Garment House, Mumbai has also not acted upon the complaint so far. Poor gardener continues to suffer. 

Name of Payee: Mr Sakhram Govind Dalvi.

SB A/C No. 10218281741

Che No. 343791 datd 11 March 2013 for Rs.63,723 drawn on SBI, Ratnagiri branch.

SBI, Andheri should have given immediate credit as it's branches are under CBS and it rather chose to send it to the Ratnagiri branch and reportedly lost in transit.

Whether Ombudsman, Garment House will look into this and redress the grievance of the poor gardner and compensate his loss of interest, time (loss of wages whenever he had to visit the branch for finding the fate of his cheque), mental agony?  

- Dr.Santhanam

Portfolio Management

.......The concluding part of the book investigates the link between Leadership and Government Decision. For executive strategy excellent leaders who convert the right strategy into desired results ought to possess a personal style, attitude, personality that makes their strategy a success. Examples are of Ratan Tata, Narayana Murthy, Azim Premji. Successful leaders select their goals, define the steps to achieve them and equip their teams with appropriate motive and skills. The author concludes that for successful execution of programmes and projects we should have higher disciplined teams with innovative leadership and ability to live up to their promises....

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Refinance support for cooperative banks dwindling

The State government’s efforts to get cooperative banks to extend higher volumes of short-term credit to the commoners is likely to prove ineffective given the denial of short-term refinance by the National Bank for Agriculture and Rural Development (NABARD) to the State’s cooperative sector and the State’s own failure to strengthen the Primary Cooperative Banks (PCBs)......

Read - The Hindu

The science of loan recovery

...... Charan Singh has used tractor loans to highlight the problem of recovery of loans in public sector banks (PSBs). But that doesn't explain the whole gamut of the credit appraisal and follow-up mess in PSBs. Issar has mooted the idea of commissioning and rotating retirees, who have had an ace record in realising NPAs, among PSBs . This is not feasible in the current system prevalent in public banks..............

Read - BS

'Internet, mobile banking users are a vulnerable lot'

........ "When RBI started allowing internet banking way back in 2001, it clearly laid the responsibility of data security and educating customers about the dos and don'ts on the banks. It was also advised that all banks offering the service take cyber crime insurance. None of that has happened even today," he informed. He also wondered why and how these things are being allowed by RBI........

Read - TOI

बच्चों को एटीएम जारी करने पर आरबीआई को रिमाइंडर

दस साल से ज्यादा के बच्चों के खाते खोलने, उन्हें एटीएम और चेकबुक की सुविधा देने के मामले में बाल आयोग ने आरबीआई के गवर्नर को पुनर्विचार संबंधी रिमाइंडर जारी किया है। बाल आयोग का मानना है कि ऐसा करने से बच्चों के खिलाफ अपराध बढ़ सकते हैं। आरबीआई को रिमाइंडर भेजने का निर्णय बाल आयोग की संयुक्त बेंच में लिया गया। .....

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No Kidding With Cash

....RBI spokesperson, Alpana Killawala counters this very belief when she says: “We think a 10-year-old will have a lot of pride in operating his/her account. The child might make mistakes initially, but that’s the way to learn about financial planning and the value of money.” This view is echoed by Deepak Bagla, an investment banker, who is also the father of two minor boys. “An independent account is a transition from the piggy bank at home. I think it’s a great way of inculcating the habit of saving among children. If there are checks and balances, like a cap on the amount that a child can withdraw every week, or in every transaction, parents will feel comfortable enough to go in for it.” It’s ironic though, that Bagla’s own children have never operated their bank accounts......

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RBI rule on ATM PIN causing thefts

Reserve Bank of India's directive to debit card holders that they have to provide ATM PINs for every transaction is giving rise to complaints of theft. PINs are being stolen through "shoulder surfing" and hacking. Shoulder surfing refers to using direct observation techniques, such as looking over someone's shoulder, to get information. Hacking refers to the breach of the machines where cards are swiped and PINs fed in.......

Read - The Sunday Guardian

Pre-paid card issuers await NDA's Aadhaar stand

.....However, there is a catch: Instead of a `swipe and sign' authentication, RBI wants prepaid card transactions to be verified using Aadhaar-based biometric authentication. The card issuers feel that this requirement is more to salvage Aadhaar rather than tackle money laundering since the withdrawal limit is only Rs 5,000. Rather than make huge investments on biometric readers, most prepaid card issuers are now waiting for the new government's response to Aadhaar.........

Read - TOI

RBI may hike individuals' spending limit overseas

...." The RBI may eventually reverse all measure taken to contain CAD and currency fluctuation in July- August last year," a Finance Ministry official told PTI. The central bank could raise the limit sometime this year based on its assessment of the external sector, the official said. As part of restrictions imposed in August last year to contain burgeoning current account deficit (CAD), the Reserve Bank had lowered the outward remittance limit to USD 75,000 in a financial year for any permitted current or capital account transaction or a combination of both...............

Read - FPJ

SBI sells non-performing assets worth ₹3,590 cr to ARCs

...SBI Chairperson Arundhati Bhattacharya said that the NPAs could fetch good value as they were secured by pledged primary assets, guarantees and collaterals. This was the first attempt by the nation’s largest bank to sell off NPAs. Bhattacharya said the bank is rolling out a new internal architecture for risk reduction. The technology-driven system will be under a “risk officer” and encompass all trading functions, early review of quality of loan assets, a scoring model and physical inspection by controllers to branches. SBI is also setting up ......

Read - HBL

Meerut jewellers hail RBI move

The recent move by the Reserve Bank of India (RBI) to allow gold imports by private trading houses has brought smiles on the faces of Meerut jewellers. For the city, with 35,000 gold artisans who generate business worth Rs 10 crore daily, the step is being seen as the first one aimed at liberalizing the gold market. ........

Read - TOI

Right step

The Reserve Bank of India (RBI) took the right step by liberalising import of gold by star and premium trading houses and jewellery exporters and allowing banks to provide loans to domestic jewellery manufacturers. A number of restrictions had been placed in the last few months by both the RBI and the government to reduce the inflow of gold into the country as..........

Read - Deccan Herald

IDBI Bank to add 600 branches, 700 ATMs this fiscal

..In 2013-14, the public sector bank had added nearly 400 branches, taking the overall size of the network as at end-March to 1,400 branches, he said. IDBI Bank, which is completing 10 years of existence as a commercial bank this year, will look to add another 700 automated teller machines during this fiscal, Batra told Business Line here on Friday.......

Read - HBL

A full plate for Modi

......If inflation was the textbook definition of “too much money chasing too few goods,” it would have been arrested by now as a result of the tight money policy followed by the Reserve Bank of India. Unfortunately, inflation, especially food inflation, is largely a problem on the supply side, an irony if you consider that state granaries are overflowing. There has been little focus in managing the agricultural supply chain over the last few years, whether it is in checking the growth of middlemen or in investing in cold chains to help preserve fruits and vegetables. A large part of this falls under .............

Read - The Hindu

Relevant ideas on ministry merging

.............Calibrating exchange rates to help exporters and domestic industry maintain their competitiveness and interest rates to help keep the borrowing rates low are in the realm of the Reserve Bank of India (RBI). The finance ministry interacts with RBI more regularly than the commerce ministry. So, if the subject of foreign trade also falls within the domain of the former ministry, the chances of more coordinated efforts to make exports competitive can be better achieved................

Read - BS

Modi Effect: India's Forex Reserves Up $11 Billion Since April

.......The rupee has appreciated around 3 per cent in the last fortnight, riding high on expectations of a slew of reforms from the incoming government, to end at 58.52 against the dollar on May 23. Some analysts feel the RBI's likely intervention so far to minimise volatility on account of sudden inflows from FIIs also helped in building the country's reserves.......

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Banking on Modi, foreign investors to pour $60 bn: Assocham

...However, the emerging situation will pose a new challenge to the Reserve Bank to deal as it will have to balance the rupee rate and inflation from the increased liquidity into the system. The new Finance Minister and the RBI, thus, will have to be on the same page in dealing with this scenario which will see strengthening of Rupee and a further improvement on the current account balance, Assocham said.....

Read - BS

Six immediate tasks for Narendra Modi

Narendra Modi inherits a weak economy. The easy options are closed to him. A demand stimulus is out of the question right now. The fiscal deficit is so large that the new government cannot crank the public spending lever. Persistently high inflation means that the Reserve Bank of India is in no position to bring down interest rates. The Indian economy thus needs structural reforms if it is to get out of the current quagmire. These reforms will necessarily take time. Meanwhile, here is a list of six policy options Modi could consider pursuing so as to get things moving......

Read - Mint