...........On both these matters, creation of UFA and setting up of FSAT, RBI Governor Raghuram Rajan has come out as being very critic al On creation of Unified Financial Authority (UFA) and setting up of FSAT, RBI Governor Raghuram Rajan has been very critical and said that some of the suggestions made by FSLRC were 'somewhat schizophrenic' and said last month that some of th e recommendations made by FSLRC were 'somewhat schizophrenic'.Sources said it was unlikely that the convergence and creation of UFA would g et announced in Parliament's Budget Session, which beg ins today, but a commitment will be shown that the government wants to do this............
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.
Monday, July 7, 2014
Debt Management in India : Need for Separation and Independence - K Kanagasabapathy, Charan Singh
.............In view of the conflict in the two volumes of the report by the FSLRC, the policy stance on independence of the PDMA is not transparently clear. In this situation, the present arrangement under the RBI seems to be more independent than the status envisaged for the PDMA. Therefore,............
Where are the savings? - Renu Kohli
.......Does this imply a commensurate increase in household financial savings? Trends in some of its key components suggest the opposite: In 2013-14, total bank deposits grew slower at 14% compared to 15.8% in 2012-13; net investments in mutual funds were down 29.7% in 2013-14; first year premium collected by life insurers grew, albeit at a slower pace of 11.8%; while retail participation in the primary market remained mostly subdued. Although the list of savings in financial assets isn’t exhaustive, the broad direction is of a decline. Further, ............
Of Financial Inclusion and Financial Literacy
........... Despite the fact that so much focus and importance is laid on the implementation of Financial Inclusion, the level of literacy and awareness among the masses has not risen to the expected level. It is doubtless a fact that without people having any knowledge about Financial Inclusion, it would have no the desired result in terms of being effective. In this regard the latest discussion paper of the Reserve Bank of India, promoting financial literacy, in a bid to bring in awareness among the people is significant. The research paper suggests ..........
Memorandum to Gajanan Kirtikar by NBOA
NATIONAL BANK OFFICERS’ ASSOCIATION (NBOA)
C/O NABARD, HO, BANDRA-KURLA COMPLEX , MUMBAI
01 July 2014
To
Shri Gajanan Kirtikar
Hon'ble Member of Parliament
New Delhi
Respected Sir,
Many thanks for sparing your valuable time to meet our delegation on 28/06/2014 at Mumbai and for assuring your kind patronage and support to AINBOA. We submit the following issues for your kind consideration and request a favourable and appropriate intervention from your good offices on these issues of paramount importance to us.........
RBI-Gangtok DGM conferred CFA Charter by ICFAI Tripura
KC Chakrabarty to Join IBHFL as Ind Director
Former deputy governor of the Reserve Bank of India KC Chakrabarty, known to speak his mind, will soon join the board of Indiabulls Housing Finance (IBHFL) as an independent director, said people familiar with the development. RM Malla, former CMD of IDBI Bank and Sidbi, and currently managing director of PTC India Financial Services, a subsidiary of Power Finance Corporation, will also join the company's board as an independent director.............
Read - ET
Read - ET
He K(h)an do it...............
Hearty congratulations to Mr. H. R. Khan on his reappointment as DG. There never was any doubt about that. I was in VOF CAB Pune a few years back. There everybody from sweeper to the Principal was singing paeans about Mr. Khan of his qualities of heart and head. I did not have the good fortune of seeing him personally. But I am sure that my prophecy of his clearing the last hurdle in RBI will come true.
B. K. Kamath, CGM (Retd.)
Heartiest congratulations to Khan Sahab. Having known Harun from the days when he was RPCD Bhubaneshwar incharge, Principal CAB and fellow Director on the Board of Dena Bank, he is a pleasant, polite, pushing and practical executive. I am sure his extension will help in continued guidance to banks.
- Subhash Wadhwa, Former MD AFC& CGM NABARD
Hearty Congratulations to Mr Khan.Hope the rural sector in general and financial inclusion in particular will thrive under his leadership.
- Dr.T.V.Gopalakrishnan
This is a most welcome move. Congratulations to H R Khan Continuity at the top will help in ensuring that the institution can take forward policy initiatives forward without losing ‘learning time’ for new incumbents at the top at shorter intervals. Government of India should guide authorities responsible for top level appointments within the government and public sector and even large corporates and organisations dependent on public resources to plan their recruitment, career progression and placement plans to make sure that the pool available for selection for top-most layer in institution/departments have enough number of eligible candidates in the age-group of 45-55 so that individuals appointed get a tenure of 5 to 10 years. HR policy needs a revamp. Sometime back eligibility criteria had to be changed to get more than one candidate for ‘selecting’ the CEO of a large public sector organisation.
- M.G.Warrier
A+ by A+ to A+
My View on "Former RBI governor: I would give Rajan A+ rating":
- M.G.Warrier
Circumventing the provisions of the RBI Act is uncalled for
The appointment of an Officer on Special Duty in the rank of Dy Governor from the private sector bank in the guise of streamlining the functioning of the Central Bank and rid it of the reputation being a monolith seems not desirable and that too in an autonomous august institution exclusively owned by the Central Government circumventing the provisions of the RBI Act 1934 is uncalled for and definitely not in the interests of the economy, the institution and its human resources. It not only takes away all the positives of the public sector character of a mighty and a nationally sensitive organisation but also weakens the regulatory system meticulously built up over a period for ensuring sound and healthy financial system in general and banking system in particular.
- Dr.T.V.Gopalakrishnan
Sahara: The Untold Story
......It is an attempt to demystify India’s most secretive and largely unlisted conglomerate, The Sahara Pariwar, which has excelled in raising money from people over decades and is embroiled in controversy including court- room drama. Sahara Story is “ a riddle wrapped in a mystery inside an enigma”. The promoter Subrata Roy merrily soaks in the glory of cricket and the film world. Roy has become the ‘ Robinhood’ of a county where only 35 per cent of the adult population has access to banking services. The background to the story is very well told. .........
Read - FPJ Book Review by P.P.Ramachandran
Vicious circle needs to be broken - Dr.T.V.Gopalakrishnan
My View on "Narendra Modi's golden opportunity - T C A Sriniva...":
The article is interesting and also conveying a lot to the new Government. The budget is a tool to set right all bad that has happened in the economy because of bad governance, keep the confidence of the people growing and make good economics and equally good politics.It is a god given golden opportunity to the new government to think afresh and be away from beaten track. The author is 100% right when novice stake control and they have no biases as such. They can do wonders and wonders are essential to revive the economy and the confidence in the economy. This wonder can start with taxation policies which are archaic and have not done anything but damage to the economy. Reduce the tax rates and take away all exemptions. People will save as savings are in their own Interest. The Government need household savings for capital formation and for this the Government has to facilitate savings.This is possible by controlling inflation, running the banks efficiently and profitably, discouraging investment in gold and real estates, reducing corruption in the society and avoiding generation of black money. All these are possible if the Government is strong, administration is efficient, accountability is fixed, transparency is maintained, information is gathered adequately and put into optimum use to draw appropriate policies etc. The present vicious circle of lower savings, lower investment, lower production,high inflation, needs to be broken.
- Dr.T.V.Gopalakrishnan
Three out of 10 in India are poor, says Rangarajan panel
A panel headed by C Rangarajan, the former chairman of the Economic Advisory Council to the Prime Minister, has dismissed the Tendulkar Committee report on estimating poverty and said that the number of poor in India was much higher in 2011-12 at 29.5% of the population, which means that three out of 10 persons are poor..............
A case to forge new economic bonds - Charan Singh
...... Ben Bernanke’s, famous ‘savings glut’ hypothesis in 2005 also underlined the interconnection of financial markets and global integration. The impact of such integration on developing countries was perhaps best articulated in August 1999 by Bimal Jalan, who had successfully guided the Indian economy through the Asian crisis of 1997, and stressed that the new financial architecture is “too heavily weighted in favour of industrial countries”. Thus far, the India’s plea for.....
RBI to convene meet of finance firms
.............The press release said the RBI had instructed its regional office in Thiruvananthapuram to initiate strong action against private financial institutions that did not follow the banking code of fair practices. The Home Minister had met RBI Governor Raghuram Rajan and apprised him of the crackdown ‘Operation Kubera’ the State government had launched against...........
RBI: India Post needs to re-apply for licence
India Post will have to re-apply for a bank licence under the differential licence norms, if they are keen to function as a payment bank, R. Gandhi, deputy governor of the Reserve Bank of India told Cogencis. “That is government. That is up to them. If they want to apply as a payment bank, then it has to be a fresh application !” Gandhi said.......
Read - FPJ
Read - FPJ
For a competitive rupee
..........For the economic recovery, which seems to have begun now, to be robust and for sustained success in manufacturing, the RBI needs to aggressively intervene in the market and buy dollars to undo the appreciation that capital inflows are causing. This would be easier for the RBI if there is better appreciation and a broader national consensus on the necessity of a competitive exchange rate.
No equal treatment to good and bad borrowers: RBI
In a simple and clear message, Reserve Bank of India (RBI) Governor Raghuram Rajan has told officials of the Telangana government they would have to differentiate a good borrower from a bad even in the case of farm loan reschedulement to protect the banking sector...........
Four suggestions for the Budget
..............For the common man, the tax burden is represented by the average rather than the marginal tax. To simplify the system all exemptions, rebates and deductions should be eliminated. Such a system will be welcome to everyone except tax consultants ! Objections will be raised on the ground that tax incentives will not be available for promoting saving. It is time that the authorities realised that saving is a function of incomes and not of returns. The latter, by way of interest or yield, determines only the avenues of investment and not the total quantum of savings. Did not people save in the past, burying their money under their pillows, before the advent of institutions like banks?.......
Acche din can wait
.......... The RBI’s mandate is first and foremost to protect the value of money, which means maintaining price stability. That requires it to make an informed guess about what the public is thinking about price movement. For the past five years the survey consistently shows that households expect inflation to be above 12 per cent. This inflationary angst is considerably above what used to be the case between 2000 and 2007, when expectations were much lower. The actual inflation rate in early 2002 was barely 1 per cent. This five-year angst also partly explains why there was.............
Major changes in Income Tax Returns (FY 2013 - 14 or AY 2014-15)
...........All salaries taxpayers will now have to give now separate details of LTA (Leave Travel Allowance) and HRA (House Rent Allowance) and other allowances separately. This will help Govt. to track proper claim of such deductions, recent HRA and LTA fallacious claimed by some MPs and Govt. taxpayers may have forced for such changes..............
5 tips on mobile banking security
A recent survey by software security firm Trend Micro says India ranks third among countries most affected by mobile banking malware. Samarpan Dutta tells you how to secure your transactions...........
Read - ET
Read - ET
Shadowy world of money movers
.....As per RBI guidelines, Indian passenger, while going abroad, can carry foreign exchange without any limit provided it is procured from authorised money exchangers. But this is where unauthorised travel agents come in. These agents usually offer discounts on a ticket if a passenger agrees to carry a small consignment. The passenger is often unaware of what the packet contains. Sometimes a group of 10 to 12 people join together and the profit is shared. The currency may be used for payment of smuggled gold. The labour class is most vulnerable. It is often on the basis of doubt that these "carriers" are intercepted at the Mangalore airport.........
Going cashless whole hog
.....The tricity, or a percentage of the upper income group, is, I presume, familiar with newer models of transferring and using money through mobiles on platforms provided by telecom operators like Airtel and Vodafone. Besides cutting down on the use of cash, an avowed goal of the Reserve Bank of India and successive governments for some time now, it also promotes financial inclusion. The earnings for operators for providing the service might not be that lucrative at the moment, but the initiative is meant for the long haul, as it is expected to lead to a substantial cost reduction in the ease of doing business........
Muthoot Finance gets nod for housing loan business
.............After the Reserve Bank of India (RBI) had raised concerns about concentration risk, gold loan NBFCs have been trying to diversify their business. Muthoot Finance has plans to get into insurance and housing finance. While it is still scouting for foreign partners for its insurance business, the current focus is on housing finance as NHB, the agency that promotes housing finance institutions, has given approval...............
Cooperatives brace for a rough ride
..............Four recent decisions that will affect the equilibrium of the cooperative sector have initiated a churning process here ? I-T department's strict enforcement of 80(T) of the I-T Act to levy income tax from cooperative societies, amendment in Banking Regulation Act that bans primary cooperative societies from doing banking business, RBI's directive regarding statutory liquidity ratio (SLR) that may hit the state cooperative bank badly and the 97th amendment of the Constitution enacted in 2011 that has made forming a cooperative society a fundamental right of a person..........
Ramkumar given charge of ICICI Bank's CSR arm
ICICI Bank is set for a change at the senior level. From August, K Ramkumar, ED, will no longer be handling HR but will be responsible for ICICI Foundation -the platform for most of the group's CSR (corporate social responsibility) activities. He will remain a member of the bank's board and continue to be responsible for the other two business verticals customer service & oper ations, and service quality. HR head T Srirang will now report directly to Chanda Kochhar, the bank's MD. Kochhar told TOI that the change in Ram's profile underscores the bank's has always been led by a very commitment to its social initiatives and ICICI Foundation, which has always been led by a very senior person. Given Ram's passion for CSR and his contribution in rolling out the ICICI Academy for Skills, the bank's key CSR initiative last year, he was the person best suited for the role, Kochhar said.
SBI unveils its digital banking initiative
.....The digital stores will be bringing several unique and differentiated offerings to the new-age Indian customers. These include instant issuance of personalised debit cards created through an instant account opening kiosk, instant in-principle loan approval and an interactive dream wall to aid customers in conceptualising their journey towards realizing their financial dreams. "SBI is committed to offering best-in-class services to our increasingly tech-savvy customers and will continue to invest in digital stores to create a superior banking experience," Arundhati Bhattacharya, chairman, State Bank of India, said.............
ICICI Bank to open China, South Africa branches this fiscal: Chanda Kochhar
....................“Our focus is on Indian companies expanding into foreign markets, multinationals from outside coming into India and also the NRIs (non-resident Indians), when it comes to the international banking business.”........................
IFC to infuse Rs 160 cr into Bandhan
........"IFC will shortly infuse Rs 160 crore as Tier II capital in Bandhan", chairman of the MFI Chandra Sekhar Ghosh told PTI. Ghosh was recently at the IFC headquarters in Washington to hold discussions with the World Bank arm, which had shown interest in greater participation in the MFI's transition into a bank.........
Chansrichawla stake in Catholic Syrian Bank falls below 10%
...............The Reserve Bank of India does not want any single promoter to hold more than 10% stake in private banks, and has been pushing such promoters to reduce their stakes. The central bank is more comfortable with dispersed bank shareholding.............
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