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, September 8, 2014
RBI report and aam aadmi - Dr.S.S.Tarapore
The inclusion triangle - Dr.Subir Gokarn
RBI Governor: Big picture reforms may take some time
RBI & Government A Bittersweet Relationship Story
........Although RBI is an autonomous organization, for a country to pass the test of time, its central financial authority and government should be able to see eye to eye in matters. As the relationship between RBI and current ruling government BJP is fairly new, it is too soon to comment on the future of this partnership. But the positive changes happening, both big and small, are giving a fairly encouraging signal.
Read........
Govt, RBI to devise monetary framework for central bank: Rajan
............'This year the government and the RBI will negotiate together to formulate a monetary framework for the RBI...the idea is to move towards an objective which has much more emphasis on inflation,' Rajan said in a speech in Chicago on Friday. He said the focus for the RBI has been on controlling inflation and on creating a sound monetary framework. The RBI Act of 1934 does not say anything about the framework that the RBI operates under, he added. 'Since 1934 we have not figured out a framework for the RBI. (It is) time we do it. The government and the RBI will do that,' he said........
India’s unlikely bedfellows
...........Yet their fates are now linked. This week both men reached symbolically important milestones: Modi has passed 100 days in office, while Rajan has finished his first year as the governor of RBI. Together they bear the burden of huge expectations for a turnaround in India’s moribund economy. Their reputations alone have prompted an early uptick in sentiment. To maintain momentum, though, they need to start acting more like the bold reformers everyone expects them to be. Reputation can go a long way, of course. In a country where nepotism and connections usually determine who occupies high public office, Modi and Rajan represent a refreshing change. Neither of them are insiders in New Delhi, whose halls of power are as clubby and claustrophobic as Washington’s Beltway. Both are high achievers with undeniably successful track records.............
Missing thanks to inaction: The Modi government should get itself a CEA
.....Jaitley’s predecessor, P Chidambaram perhaps did not miss not having a CEA when Rajan left North Block, because he had Parthasarathi Shome as advisor to the finance minister to consult on fiscal matters. For macro issues, there was the Planning Commission and the Prime Minister’s Economic Advisory Council. These are not part of the finance ministry, but at least there was economic advice from within the system that was available. But Jaitley hasn’t appointed an adviser to the finance minister (a post that is co-terminous with the tenure of the minister). The Planning Commission has been disbanded, as has the Prime Minister’s Economic Advisory Council. "The only real expertise within the system in macro-economic policy is currently in the RBI. The government could end up being hostage to the central bank," Pronab Sen, chairman of the National Statistical Commission, points out...........
RBI unions take exception to HR rejig, lateral recruitment plan
...........Signatories to the letter included SV Mahadik of the RBI Workers’ Federation, CM Paulsil of the All-India RBI Officers’ Association and RN Vatsa of the RBI Officers’ Association. The Forum recalled its meeting with the Governor, Deputy Governors, and senior officials on August 19, wherein it had expressed concern over the proposed restructuring and clustering. It had also expressed serious opposition to lateral recruitment in leadership positions on a continued basis and had sought meaningful interaction for an amicable settlement..........
AIBOA central committee to meet in Kolkata to discuss wage hike issue
...........Public sector banks are the major foundation of Indian economy. With changing times, these entities would need to rejuvenate themselves like the private or foreign counterparts. A healthy wage structure and service condition would inspire and motivate the workforce, he added. Meanwhile M A Srinivasan, General Secretary, Canara Bank Oficers' Union told Business Line that the Central Committee of the All India Bank Officers Association would be meeting on September 16 and 17 at Kolkata to discuss wage revision issues, growing problem of NPA in the banking industry and issues concerning banking reforms such as payment banks among others. The AIBOA demand includes a 25 per cent hike in the pay-slip component, 5-day week and proper disciplinary guidelines..........
HDFC Bank To roll out the programme across all 96 branches in Odisha
...........The programme will be rolled out across all 96 branches in Odisha to educate customers and create awareness. The initiative was launched by guest of honour, Mr. P.K. Jena, Regional Director, Reserve Bank of India, Odisha. The 'Secure Banking' initiative comprises a series of workshops, which educate customers through presentations, on matters they need to be careful about, while conducting banking transactions............
RBI conducts financial literacy camp
..AGM Guite, also briefed the students on the various roles and functions of RBI. He said the RBI launched a project of 'financial inclusion' 8 years back which is now carried forward in a mission mode under the PMJDY to bring all the population of India under banking and financial system. He further pointed out how the process of opening bank account have been simplified and encouraged students and family to avail the opportunity..........
Read...........
RBI opens supervisory college for ICICI Bank
.........The RBI sets up supervisory colleges for banks which have good international presence. The main objectives of such colleges are to enhance information exchange and cooperation among supervisors, to improve understanding of the risk profile of the banking group and thereby facilitate more effective supervision of internationally active banks........
Study business at NUBS
............The Global Experience Opportunity (GEO) is a programme of activities created to provide students with opportunities to enhance their global employability through a mixture of study and work experience initiatives. It introduces students to the international business community and equips them with the practical skills needed to succeed in today’s hugely competitive and fast-paced global business environment. Students who take up this programme get the opportunity to intern with the Reserve Bank of India (RBI) and undergo a challenging 6-week summer internship. The participants undertake project-based work within the key functional areas of the bank, while gaining insights into India’s diverse culture. They are also exposed to the fast-paced business environment. This year, Newcastle students will have the unique opportunity to work at RBI along with students from Boston University........
Government of India can print Rupee 1 note: Law Ministry
......However, since the RBI was of the view that with the repeal of Section 2 of the Currency Ordinance, the Government of India is not empowered to issue note of denominational value of one rupee, the law ministry opinion was taken. The Law Ministry in its opinion stated that the Coinage Act of 2011, which consolidates the laws relating to coinage and the mints, does not bar the Government of India from printing one rupee notes.
Fake notes a menace for traders in Hubli-Dharwad
............Many traders say spotting fake notes is tough because they're very similar to the real deal. Some fakes found in the cash dispensed by some ATMs, banks and financial institutions. Mounesh Hadapad, a private company employee, said he was given a fake Rs 1,000 note by a cooperative bank. "When I went to Vijaya Bank to deposit it, the staff rejected it and proved it by placing it on a fake note detector," he said. He added that his point that another bank had given him the note wasn't considered. "I thought of complaining to the police but didn't do it as they may suspect me of wrong-doing," he said. ...........
Devotees bid adieu to Ganesha in Prakasam
..........Elderly people joined the youth in the celebrations by bursting crackers to give a warm send off to the Lord for removal of all obstacles and return for the festivities next year. Ganesh idol made out of four lakh coins, taking special permission from the RBI officials stood as highlight during this year's celebrations..........
Heritage marathon on September 14
Prastara Public Charitable Trust will be organising Madras Heritage Marathon on September 14. It has three categories,3 km, 5 km and 10 km.The event is supported by running clubs Chennai Runners, Dream Runners and Cool Runners. The run will begin from Queen Mary’s College and runners will run across heritage structures and monuments until RBI. For details, call 9884018618
The Hindu
Pension reforms miss the wood for the trees
...........Yet, the basic truth is this: a majority of the workforce today lacks any form of retirement security. Though India is likely to see its 60-plus population swell from 80 million to nearly 200 million over the next 15 years, nearly 90 per cent of these people are not covered by any formal pension scheme......
PSBs Headed for Consolidation
.........The ministry is expected to soon hold a meeting with all state-run banks to discuss issues related to their operations, their contribution to the economy and coordination with other arms of the government. The issue of consolidation will also be discussed at this meeting, a senior finance ministry official said, adding that any merger proposal will be evaluated on the parameters of panIndia presence, business and information technology integration. “The government has limited capital to offer and it has to be deployed judiciously,“ the official said on condition of anonymity. The government will draw the road map for bank capitalisation on the basis of performance of the banks in the second quarter of the current fiscal, the official added...........
Read - ET
Priority sector needs priority relook
My View on "RBI may relook at priority sector norms for foreig...":
The concept of priority sector lending was introduced to ensure credit flow from the banking sector to certain neglected sectors including agriculture. The need for some persuasion to encourage banking system to provide adequate credit to priority sector is still there as banks on their own would prefer to deploy credit in bigger urban ventures. Several attempts to shift responsibility by lending to service/consumer sectors, investing in RIDF etc were allowed to achieve priority sector targets. Internal reviews by RBI or at state level forums also concentrated on ‘targets’ and their achievement and a comprehensive look at willingness and capability of each bank to finance priority sector especially in rural areas is yet to happen.
- M.G.Warrier
Funds from shores afar
........There are, of course, many good reasons for NRIs to park their money in India in the three schemes that are now in operation. Clearly, they earn a little more from these deposits than they can hope to get in developed economies, where such schemes will earn them much less. Such deposits are also a reflection of their confidence in the Indian economy, its growth potential and financial system, where their money is not only safe but can also get good returns. Finally, NRIs do have a social and emotional connect with the country they belong to and investing in these deposits gives them that extra satisfaction..........
Interest rates turn real
............Nevertheless, with fixed deposit rates now higher than inflation and with buoyant equity markets, it’s likely that the share of financial savings in household savings will increase. Note also that India is one of the few Asian countries to have positive real rates, the credit for which should go to central bank governor Raghuram Rajan.
Inflation looms over RBI plans
..........RBI will announce the bi-monthly review of the policy on September 30. Bringing down inflation has topped the agenda of Mr Rajan who has hiked rates thrice in his year-long stint as the central bank Governor. Recently a series of commentary from the finance ministry had indicated that it wants interest rates to come down given inflation has “moderated”. “We see inflation is going to come down further and we hope as the (RBI) governor has in his recent credit policy stated, RBI will not hold interest rates high any longer than is necessary and I hope that threshold we will reach soon enough,” finance secretary Arvind Mayaram had said during an interaction with the industry some two weeks ago..........
Monetary stimulus may backfire, provoke savings glut, says Rajan
....."Any emerging market today is going to look at the currency volatility and say 'whatever money comes in, I am going to be careful about it, I am going to build some reserves,'" Rajan said in a speech in Chicago on Friday. "That kind of policy will depress global demand."........
BRICS bank not aimed at challenging IMF, World Bank: RBI Governor Raghuram Rajan
........."I don't think it was primarily meant to challenge the existing multilateral institutions but it certainly is saying look we have plenty of money ourselves, why don't we put some of this money to use in a way that benefits us rather than necessarily depending on the multilateral institutions to change which is taking much more time than anybody thought of,".........
FOXED BY LACK OF RBI'S NEW BANKING GUIDELINES, NBFCS SHIRK FROM RE-APPLYING
Confused by RBI's lack of guidelines for new banking licences despite the announcements of licences on-tap, NBFCs like the ShriramGroup has said that it will only apply for standalone banking licence and was not keen to convert its NBFC into a bank............
Read - The Pioneer
Read - The Pioneer
Jan Dhan Yojana: KPMG to validate number of accounts opened by banks
.......KPMG’s confirmation of the number of accounts opened will help the Centre pitch for an entry into the Guinness Book of World Records for the maximum number of bank accounts opened in a day, banking industry sources said. It would also provide some comfort to the Finance Ministry that the numbers submitted by the banks were accurate and reflected the true picture.........
Making laws for 'glocal' economy
............The central bank's recent circular was triggered by complaints by the competitors of Uber Technologies that the San Francisco-based provider of niche cab services had violated Foreign Exchange Management Act (FEMA) norms and didn't have in place a second level of authentication. Uber didn't respond to emailed questions on the issue. Senior executives from the e-commerce segment say it makes business sense to offer a global service through a single-payment gateway rather than use multiple payment systems across many countries. The e-commerce economy doesn't recognise geographical or national boundaries. As a result, ...........
Uber in talks to integrate digital wallet in India
..................Uber stores credit card details of passengers and automatically charges the card once the taxi ride is over without two-factor authentication as it uses an international payment gateway. Companies such as Uber now have until October 31 to become compliant. "They are working on integrating a mobile wallet into their application," said a person with direct knowledge of the discussions. "It will most likely be Paytm. The integration will take some time as it has to go through the Uber proc ..
Shady gold auction raises police suspicion, 63 kg seized
.......The officials of the firm claimed that they could sell the gold at any price they wanted since there are no guidelines from the Reserve Bank India. “We have written to the RBI for clarification in the case. We have been informed by the firm that the seized gold belongs to more than 3000 customers. But they have not maintained documents to support their claim,” DCP Goyal said..........
SBI to raise global biz share to 25% in 3 yrs
.......“International operations should actually give us a risk diversification. Meaning, it should not be doing only Indian business, sitting at a foreign centre. Of course, it is our strength and we would continue to do part of that but we are now trying to localise as much as possible.”......
Dena Bank wants govt to dilute its stake in the PSB
........."Our target is to grow at around 18% in the next 18 months, primarily driven by SME and retail," said Dena Bank's Chairman and Managing Director Ashwani Kumar, who noted that to support this growth the bank would require around Rs 1,200 crore. He said the retail book alone is expected to grow by around 23-24%. The bank already approached the government, which holds about 58% in the bank, for capital infusion. "We also asked the government to reduce its holding to 51%. If we do not receive this capital, then our growth would be around 11%."........
Unique identification number planned to track bank loans
......This will give information about the number of officials involved in sanctioning the loan, the stage at which the application was rejected, and the official who rejected the loan application. The move, which is in the final stages of discussion, will bring in more transparency in sanctioning of loans and check cases of bribery in disbursal. The lenders will also be asked to monitor the end use of loans disbursed and keep close watch on the activities of a company or individual availing of the loan................
'Sudipta planning for ‘Saradha bank’ licence from scam funds'
...........“The capital for this bank could have been anywhere above Rs. 1,000 crore and the group was banking on the funds that its front companies had collected by floating the ponzi schemes which are now under probe after the scam broke out,” a source privy to the development said. Documents related to RBI guidelines, rules and regulatory compliances required for applying a bank licence were recovered during detailed searches, sources said, adding some of them were found after data was forensically recovered from computer hard discs. “Had the scam not broken out, the group would have applied for the license. We get to understand that the brand name for this future business venture would have been showcased as ‘Saradha bank’,” the source said......
Syndicate Bank- Bhushan Steel fiasco: Banks in a spot over 'mistaken identity'
Is one of the men arrested in the scandal over alleged bribes for higher loan limits the victim of mistaken identity? Lenders certainly hope so...............
The ones that got away
How did so many get-rich-quick schemes spring up in the first place, without the approval of the Reserve Bank of India or the Securities and Exchange Board of India? If this is what you’re wondering, they have essentially exploited grey areas in laws that made SEBI the regulator for ‘securities markets’ and RBI the regulator for banks and NBFCs. As most of the money-pooling schemes collected money towards ‘units’ in plots of land, livestock, time-shares and so on, they claimed that they weren’t dealing in securities or deposits. But the high-profile Sahara and Saradha cases prompted Indian lawmakers to recently amend the SEBI Act to plug this loophole.........
Vijay Mallya, defaulter
.............While recommending revised rules for restructuring loans, the Mahapatra Committee noted that a significant portion of restructured standard assets turned into non-performing assets (NPAs) because they were weak to begin with, and the reason banks went ahead with the restructuring was because the quality of due-diligence was so poor; a recent media report highlighted how the restructuring for R14,000 crore of debt was not working out. It is perplexing how bankers can be so casual with their ..........
‘Our bank is institutionalised, not family-run’
A lot has changed in the first five months of this fiscal, particularly in the last three months of the new government. Business confidence, in terms of conviction and message has dramatically changed the economic environment. Industries like FMCG, pharma, IT, renewable energy and M&As within the domestic sector are seen as game-changers by bankers and economists. YES Bank’s MD & CEO Rana Kapoor is all pepped up for a gear-shift under the new regime. “But the bigger worry is for these (initiatives) to translate into kinetic energy or what we commonly say, green shoots,” he tells OP Thomas in an interview. Excerpts............
Goa mining ban: OTS formula hits a road-block
...........A debt relief scheme notified by the Goa government recently to partially write off accumulated interest or principal of the bank loans of borrowers affected by mining ban through a one time settlement (OTS) formula has faced a road-block as the scheme is yet to get clerance from the Reserve Bank of India(RBI)........
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