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.
Tuesday, September 9, 2014
Reserve Bank to pick talent via UPSC-like test
Thoughtful analysis
My View on "Pension reforms miss the wood for the trees":
This is a thoughtful analysis of an issue which is viewed by different people depending mainly on the individual age and job profile. Having said that there is need to debate the inadequacies in the old age care and social security systems considering the alarming rate at which the population of ‘senior citizens’ is growing and the disgraceful manner in which that category is being described as a burden on the ‘working’ and ‘earning’ population. C R L Narasimhan writing in his column Financial Scene on July 21, 2014 had referred to a response from me and said that The Hindu will revisit issues like the NPS, the method of calculating pension and the capping of the minimum wage. Seen in this perspective, the issues like inadequacy of returns on retirement savings, the unprofessional way in which funds with EPFO and NPS are managed raised here and the greedy manner in which government look at and handle funds with FPFO, LIC and public sector organizations should be further debated for suggesting corrective measures.
- M G Warrier, Mumbai
KRISHNA PUBLIC SCHOOL BAGS RBI QUIZ CONTEST
..........The Chhattisgarh round of the quiz received a very good response from schools all over the State and more than 70 teams participated in the preliminary rounds. While addressing the participants as chief guest for the event, RSU Vice-Chancellor Dr Sheo Kumar Pandey highlighted the role played by television in promoting modern day quizzing. He appreciated the efforts made by RBI and also posed two quiz questions to the participants. Dr Sanjeev Sharma, General Manager and Officer-in-Charge RBI, Raipur, in his welcome address outlined the financial literacy endeavours of RBI of which RBIQ was an important component. He also emphasized upon the important role played by financial literacy in the financial inclusion programs of RBI............
SBI launches multi-currency international debit card
.......“To begin with, the prepaid debit card will enable customers to load four currencies – US dollar, euro, Great Britain pound and Singapore dollar. More currencies will be added going forward as the card has the facility to be loaded up to 12 currencies, S K Mishra, Deputy Managing Director, SBI, said. Mishra added that outbound travel from India is growing with 35 million people travelling outside India. “This is expected to grow to 50 million in 2020. Consumers expect smart products to address their travel needs. The multi-currency foreign travel card gives an option to load currencies of choice at SBI’s branch network,” he said...........
SBI seeks RBI’s nod to launch contact-less debit cards
The country’s largest lender State Bank of India today said it is planning to launch contact-less debit cards which would enable customers to carry out some transactions without entering the pin number. The bank has sought Reserve Bank’s permission for this. “Right now, for any card which has to be used, a customer has to put in the pin number. Some exception has to be made as for lower amount deals like buying a Metro or bus ticket, where he can simply show the card and get in......
LVB hikes interest rate on savings accounts with over 1 lakh balance
.........“An increased rate of 5 per cent will be offered to all customers on entire balance (Rs one lakh and above), calculated on a daily basis. It means that even if a customer keeps balance of Rs. 1 lakh and above in his savings bank account for a single day, he will be paid interest at the rate of 5 per cent per annum for that day,” the old generation private sector bank said in a statement.............
Kotak Bank appoints woman director on board
Kotak Mahindra Bank has appointed Farida Khambata as additional director on its board with immediate effect. The decision was taken at a board meeting on Sunday, September 7, Kotak Bank said in an exchange filing.............
Arun Thiagarajan resigns from ING Vysya Bank
........In a notice to the BSE, the Bangalore-headquartered private sector bank said it is taking necessary steps to appoint a successor in due course. Thiagarajan had joined the bank, which has 547 branches and about 10,000 employees, in 2010..........
Karnataka Bank appoints new additional director
Karnataka Bank Ltd has appointed BA Prabhakar, former Chairman and Managing Director (CMD) of Andhra Bank, as an Additional Director of the bank. The bank informed the BSE on Monday that the board, which met on September 6, has appointed Prabhakar as an Additional Director of the bank..............
Women and the Funding Challenge
..........For many first-generation women entrepreneurs, securing funding comes with a gender baggage. In general, banks want women to cough up stiff collateral or rope in a male guarantor. “Women are still asked (by banks) if husband or father will be the guarantor,“ says Zankhana Kaur, director, TiE Stree Shakti, Mumbai, which promotes women entrepreneurship. Elsewhere, early-stage investors quiz them on, besides their business idea, personal matters like marriage, relocation and kids, and what would happen to the business in their event; these are things they would rarely ask a man, say women entrepreneurs who have tried to raise funds through formal channels. “While there has to be due diligence for a business case, you cannot have it as a check list,“ says Kaur..........
New highways to economic growth
..........Atri Mukherjee, in a report titled “Regional Inequality in Foreign Direct Investment Flows to India: The Problem and the Prospects” (2011), written for the Reserve Bank of India (RBI), says that for the period between 2008-2009 and 2011-2012, these six States received 70 per cent FDI; Delhi and Maharashtra between themselves accounted for 50 per cent FDI. To get over this inequality, it is important not just to develop other States which have been left behind, but also encourage their participation in reaching out to the outside world. Here, Mr. Modi would do well to take a leaf out of the book of both the U.S. and Chinese models of sub-national participation in economic diplomacy, where provinces which were not developed were given special attention......
RBI norms on Basel III instruments are credit positive: Moody's
............“They will make the instruments more attractive to investors, broaden the investor base for additional Tier 1 (AT1) securities to include retail investors and allow banks to have a higher proportion of AT1 capital in their Tier 1 capital,” Moody’s said in its credit outlook report..........
Moody's points to fiscal, inflation worries
................Moody’s has repeatedly stated it is more concerned about the medium-term plan for the fiscal deficit and not only this year’s target. The finance ministry has already committed to reining in the fiscal deficit at three per cent of GDP by 2016-17. Mayaram said the government had set up an Expenditure Management Commission, which would look at broad contours of subsidy rationalisation.....
The exaggerated death of inflation
...........True, back then, monetary authorities were working with old-fashioned Keynesian macroeconomic models, which encouraged the delusion that monetary policy could indefinitely boost the economy with low inflation and low interest rates. Central bankers today are no longer so naive, and the public is better informed. But a country's long-term inflation rate is still the outcome of political choices not technocratic decisions. As the choices become more difficult, the risk to price stability grows. A quick tour of emerging markets reveals that inflation is far from dead. According to the International Monetary Fund's April 2014 World Economic Outlook,........
How India compares on financial inclusion against other countries
.....................But while we may cavil about the choice of method, there’s little doubt that India remains a vastly under-banked country. Also, what matters most for households is not opening deposit accounts, but access to credit. It’s in this regard that India’s track record is abysmal...............
Banks steal from the poor to loan the rich
.......Suppose a poor opens an account and deposits all his/her hard earned savings in it. What will he or she get - 4 per cent interest? Does not this mean that the poor depositors will end up subsidising the lendings to the rich and big corporates, who hardly keep any money in the savings account. What is the rationale behind doing this when several big corporates are defaulting on loan repayments? Today Indian banks have stressed loans that include the bad loans and the restructured loans, to the tune of Rs 10 lakh core, which is more than the total net worth of the banks.............
3 Vid DCC banks urge HC to direct RBI to treat them in parity with 16 banks of UP
Three unlicensed district central co-operative banks from Nagpur, Wardha and Buldana in Vidarbha have urged through their second re-joinders that their writ petitions be disposed of by the High Court here, with direction to the Reserve Bank of India (RBI) to withdraw its orders of rejecting these banks’ applications for grant of license to them to enable them to revive and survive in the larger interests of the depositors and general public of the area...........
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Don’t bank on it, yet
.........In recent years, a number of committees have been set up to recommend ways in which financial inclusion can be expedited. Such panels have been headed by, among others, Raghuram Rajan, the current RBI governor, K.C. Chakrabarty, former RBI deputy governor, and Nachiket Mor of the ICICI Bank. These committees have made many suggestions. We were told that micro-finance institutions (MFIs) and self-help groups would be of great help. But some of these institutions got embroiled in controversies and their promoters were considered no different from the typical, avaricious village money-lender. These MFIs could, at best, supplement the efforts of — but hardly replace — the traditional bank...........
Let Us Learn Jan Dhan Yojana Through An Intelligent Customer
........A scheme launched with good intentions may become a thorn for the banks and later on for government. There is a need to immediately introspect and issue the necessary clarifications. Let the speed be controlled as there is well known saying: SPEED THRILLS BUT ALSO KILLS. Anyway, as bankers need to keep up their spirits high even in gloomy mood, we provide the following fodder .........
Jan Dhan Yojana's real test
In his column "The inclusion triangle" (Muddy Waters, September 8), Subir Gokarn has lucidly brought out the high and low points of the Jan Dhan Yojana. The real challenge will be to keep the accounts alive, fund the overdraft mechanism and clarify doubts on the insurance cover. Moreover........
Jan Dhan Yojana opens a new door for RuPay gateway
.....AP Hota, Managing Director and CEO of National Payments Corporation of India Ltd (NPCI), toldBusinessLine that the target for the year-end was six crore cards. By March 2015, RuPay may be able to add an additional 10 crore accounts. If the Centre’s financial inclusion scheme lives up to its hype, the sheer number of RuPay cards in the country will create a critical mass that will help create a huge network of retailers who accept RuPay cards. According to Reserve Bank of India statistics,............
Declining Cost of Funds Spells Higher Earnings for NBFCs
.......Major NBFCs were impacted the most when the Reserve Bank of India tightened liquidity to ease exchange rate volatility in July last year.Large banks have a fair chunk of retail deposits, so they were not affected to the same extent. In certain segments like housing finance, NBFCs could not pass on the higher cost of funds due to competitive pricing by banks. This resulted in lower net interest margins for them in the past one year. However, with lower wholesale rates the NBFCs are expected to improve their margins in the next few quarters...........
Read - ET
Bandhan ropes in Ogilvy & Mather for building banking image
........... “We were talking to a few global majors for our requirements as currently we are drawing up plans to transform our micro-finance operations into mainstream banking. Ogilvy will create a logo and advertising strategies; it will also look after the interiors of bank branches,” Bandhan chairman and managing director Chandra Shekhar Ghosh said.............
My bank will not leave any wilful defaulter, says ED of United Bank
.......UBI had taken the step in line with the master circular issued by the Reserve Bank of India on wilful defaulters. He, however, declined to show his hand on his future plans (on declaring more borrowers as wilful defaulters). UBI has listed some 405 companies and their directors as wilful defaulters. This includes only a few big names. Most of UBI non-performing asset is on account of the MSME sector. Mr. Narang, along with Sanjay Acharya, also an ED, has been steering UBI since the erstwhile chairman-cum-managing director Archana Bhargava quit office in February 2014, leaving the bank steeped in a Rs.1,200-crore quarterly loss and a mountain of non-performing assets.....
How will the defaulter tag play out for Mallya?
........But it is a situation which India Inc. is watching closely: how will Mallya get over this crisis? Will it finally take its toll on the man who has always - during the past three decades at the helm of his UB Group - punched way above his weight and has pulled it through? Most important, this will show how the whole campaign against wilful defaulters plays out. Mallya's challenge this time is not about leveraging his assets.........
Kerala’s finances turn precarious
................The State borrowed Rs. 100 crore from the Reserve Bank of India (RBI) on Friday after it exhausted the State’s Ways and Means limit of Rs. 350 crore. The government has already announced its decision to issue bonds for Rs. 500 crore on Tuesday. It had raised Rs. 1,000 crore in late August to meet unavoidable expenditure in connection with the Onam festival season. The last time the State fell into overdraft was eight years ago.........
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