Updation of Pension for RBI retirees

My understanding of the approval, by the Union Cabinet yesterday, of "ONE RANK ONE PENSION"  for armed forces employees and ex-servicemen organisation employees is that upgradation of pension has been approved for them. With this move, it would be unfair to deny such a benefit to RBI employees. It has been reported that there is now a better understanding between the FM and the Governor. The present FM is a very intelligent person and no IAS official, however brilliant he/she may be, can boast of a better intellectual equipment than that of the FM. In fact, the minor criticism some times levelled against the FM is that he doubles as his Under Secretary in that he goes into minutest details of each and every case. If we wish to be more charitable to him, we would have to readily concede and appreciate that he has eye for details without missing the macroeconomic and big picture. He cannot be taken for a ride by any bureaucrat. Our Governor is a highly accomplished person (his academic achievements are such that all of us can be proud of-- Gold medallist in IIT, First rank in IAS besides being a Ph.d) and would have known all the details of our Pension case. If he takes an appointment with the FM exclusively for the Pension case and presents the case before the FM, I have no doubt that the FM would be sympathetic to our case and approve the proposal. The present FM is not one who would be simply guided by his ministry bureaucrats and has the courage and conviction to give his decision with out the need of any crutch of favourable notings from his ministry officials.

I hope our Governor, whose sympathy for our case has been appreciated and voiced by all the serving and retired employees, does this quickly. He could perhaps tell the FM that once a favourable decision is taken, the Mumbai High Court could be informed of the decision by the Retired Employees Association, who had approached the court against the withdrawal of the Pension upgradation granted in the past upto a certain period,  as well as the Bank and the Government and and submit to the court for withdrawal of the petition. Ministry of Law, Government of India, on whose advice perhaps the matter is being allowed to remain with the Mumbai High Court, should not have any objection to this move.

- A. Chandramouliwaran, Former Executive Director

Read - Bank's affidavit - Sent by L.R.Parab (via e-mail)

Beware, the message is not from RBI

Playing officials of the RBI, cheats are on prowl in Jammu Kashmir. They send SMS messages to gullible people telling them that they have won prizes.......

Read...........

Fraudulent tax refund mails in circulation

......The fraud mail originates from the 'tax refund department', bears the address 'service@incometaxindia.in' and has a subject line which says 'tax refund notification alert'. The language and format of the mail is strikingly similar to any formal correspondence from the I-T department. It addresses the receiver of the mail as 'Dear valued taxpayer' and goes on to say that you are "qualified for a refund which could run into as much as Rs 50,000". The mail asks the reader to 'click' on the hyperlink to place a tax-refund request. The hyperlink opens to the homepage of the RBI, but the website address panel shows www.chatbordel.de. The page asks for bank name, ATM number, ATM PIN number, CVV number, card expiry date and transaction password.......

Read - ET

CRR has merits, asserts Gokarn

.......“The CRR is an instrument with multiple attributes. It is a tool to manage liquidity, which is often an end in itself, but can also have monetary implications,”......

Read - The Hindu

Bank review meet held

Dominic Presentation MLA inaugurating the DLRC meeting in Kochi. Lead District Manager KR Jayaprakash, RBI Assistant General Manager KJ Joseph, Union Bank of India Deputy General Manager S Jayamohan Nayar, District Collector PI Sheik Pareeth and NABARD representative Thrivikraman are also seen

...... Banks in the district are going ahead with the process of Meaningful  Financial Inclusion. The survey conducted by Kudumbasree Mission revealed that there are nearly 20 percent adults in the district without bank accounts. Ward-wise campaigns by banks to open accounts are progressing.  Banks will also offer remittance services and micro-insurance policies. The process is expected to be completed by the end of October 2012......

Read........

Mamata Banerjee skips SLBC meeting in West Benga

West Bengal chief minister Mamata Banerjee has turned down United Bank of India's request to attend the quarterly state level bankers committee held on Tuesday. UBI, the SLBC convenor in the state, now plans to pursue the chief minister for the December meeting where Reserve Bank of India Governor D Subbarao will be present. It's now become a norm in the banking circle to invite chief ministers in state level meetings. RBI wants CMs to attend at least one SLBC meeting a year so that they can directly address the issues face by banks. .....

Read - ET

FinMin for zero charges on e-transfer up to Rs 1 lakh

......The RBI had recently said that it is 'desirable' that the benefits accruing on account of increasing volume of transactions are passed on to the customers so as to incentivise greater use of the electronic payment system.

Read......

Evolution of India reform a factor for policy - Gokarn

India's persistent inflation and sub-par economic growth has the Reserve Bank of India (RBI) caught in a monetary policy vise but conditions in the economy should not be considered static, Deputy Governor Subir Gokarn said on Tuesday.......

Read......

Inflation still at unacceptable levels: RBI Governor

......"Inflation should be brought down to provide relief (especially) to poor (people)," Subbarao said while addressing the gathering at 'Outreach Programme' to make people aware of banking services.......

Read - DNA

Subbarao hopes banks will cut lending rates

Chhaproh (Himachal Pradesh): The Reserve Bank Governor D Subbarao Tuesday expressed hope that banks would lower their lending rate in response to the recent cut in the CRR-- the percentage of deposits banks have to keep with the central bank.......

Read.......

Way to beat a cash economy

......Meanwhile, developments such as the Inter-Bank Mobile Payment Service payments platform created by the National Payments Corporation of India in collaboration with 50-odd banks will help. So will the fact that RBI has doubled the limit on daily transactions in cash to Rs.5,000 and that in goods and services to Rs.10,000. Given that India is a young nation with tech-savvy youth at home with apps, tablet PCs and Internet-enabled phones, the target appears achievable given that in July alone both m-banking transactions and their value grew 198% and 174%, respectively, over the year ago period.

Read - Mint

Economy sees a few green shoots

Analysts say gaining rupee, falling prices will help ease inflationary situation.A strengthening rupee and cooling crude oil prices over the past few months are expected to help lower inflation, ease fiscal deficit and give room to the Reserve Bank of India (RBI) to cut interest rates, besides cooling off pump prices of petrol.......

Read - Deccan Herald

Can't use Kingfisher brand as collateral, RBI tells banks

The Reserve Bank of India (RBI) has asked banks not to treat Kingfisher Airlines’ brand as collateral since it is intangible. This is because the loan has turned non-performing for most of the banks. The RBI’s rejection means lenders will have to treat their exposure to Kingfisher as unsecured, for which the provisioning requirement will go up substantially.......

Read - BS

Govt backpedals on banking reforms as Parliament bites

......Earlier, the Reserve Bank of India said that it would give fresh banking licences to private entities only after the government amended the Banking Regulation Act. However, now the finance ministry is trying to work out a method by which licences can be granted without amending the act.......

Read - Hindustan Times

Internet bankers told not to use shared computers

......The Banking Codes and Standards Board of India, an autonomous and independent watchdog body in the banking sector, has cautioned customers utilising internet banking facility against using cyber cafés or shared personal computers (PCs) to access internet banking site. The advice is contained in the list of codes issued by the board as part of improving the services in the banking industry. The codes are reviewed periodically.......

Read - The Hindu

2012 a replay of 1991? Who should you believe, PM or RBI governor?

...... And there's no disputing the PM is a politician par excellence!  Remember what the late Dr I.G.Patel, former RBI Governor and noted economist, once said about him, 'Under-rated as a politician and over-rated as an economist'. Well the PM has proved Dr Patel right! Not for the first time!......

Read - ET

I don’t Think We Are Anywhere Near ’91 Crisis

The government's decision to take a few hard steps will go a long way in changing the perception among investors, says Raghuram Rajan. In an interview with ET Now's Supriya Shrinate, the chief economic advisor says he's hopeful of some upward momentum in the coming days. Edited excerpts:

Read - ET

Fixed Income: Risks with NBFCs

......More disturbing is RBI’s belief that NBFCs are immortal. They have permitted NBFCs to issue ‘perpetual bonds’ to investors, with a 10-year option that enables NBFCs to repay but prevents the investors from demanding repayment. It is akin to writing off your wealth for a fixed rate of interest. RBI works in favour of NBFCs by just letting them increase the interest rate by a mere one percent at the end of the 10th year......

Read - Moneylife

My View.......

The issues raised deserve wide publicity and debate among people who can throw light on behaviour of interest rates. Less secure the investment you make, chances are you get higher rates of interest in the short term. NBFCs and NBFC-like institutions and even certain individuals have mobilised huge amounts of money in the past and vanished. To protect the interests of small investors, government and banks should come out with investment instruments with reasonable return. Regulators and GOI, as part of efforts to promote financial literacy, should promote awareness about the risk in being lured by advertisements offering ‘higher than possible’ returns on investments.

- M G WARRIER

Court slams PSU banks, says you are in money, not property business

Coming down on a bank for meting out 'unfair deal" to a client by selling his commercial building for Rs 18.7 lakh to recover a loan due of Rs 19,500, Kerala High Court today reminded the nationalised banks that they are only engaged in money lending and should not take up real estate business.......

Read - FE

Sebi seeks ASBA facility at all branches of designated banks

......"Based on the analysis of the current presence of ASBA facility, it is felt that there is substantial scope for increasing the reach of ASBA facility to make the application process more convenient for investors," Sebi said. "Towards this end, consultations were held with Reserve Bank of India, Indian Banks' Association and other market participants, to explore the possibility of providing ASBA facility at all branches of Self Certified Syndicate Banks (SCSBs)," it added.

Read - BS

Earnings ratios are bottoming out: Richard Gibbs

How do you interpret the Reserve Bank of India (RBI)’s recent move?

The decision to leave interest rates unchanged and to cut only the cash reserve ratio by 25 basis points reflects RBI’s concern on persistent inflationary pressures, even against a background of moderating domestic demand growth. We continue to believe the Indian economy faces difficult supply-side conditions. If these persist, ultimately, the economy’s potential growth would be reduced. Needless to say, we continue to anticipate the government would pursue further measures in respect to its ‘reform and development’ drive, as it recognises building the economy’s productive capacity is the best form of stimulus that can be delivered......

Read - BS

3 of 6 banks govt wants to help have scam-tainted past

If the state considers the Rs551-crore bailout package for the six district co-operative banks (DCBs) currently in the red, it would mean flushing taxpayers’ money down the drain. Six DCBs – Nagpur, Osmanabad, Jalna, Dhule-Nandurbar, Buldhana, and Wardha – all controlled by political heavyweights, could lose their banking licence on September 30 as per RBI directives, jeopardising credit line to farmers. The banks have a history of mismanagement and serious financial irregularities......

Read - Hindustan Times

NABARD and RBI - A 30-Year Legacy Being Upturned

The effort to edge out the Reserve Bank of India from the National Bank for Agriculture and Rural Development's shareholding does not bode well for the future of agricultural and rural credit in the country. This is particularly so, if the past experience with the Industrial Development Bank of India and the Unit Trust of India is any guide....

...... The know-all babus of the banking division of the finance ministry, who neither have an understanding of banking and development finance nor the experience, seek to keep out the RBI from NABARD and bring the institution completely under its control. Through this amendment it also seeks to subvert the autonomy of the institution, render the board powerless and emasculate its functioning. The stellar achievements of NABARD in the 30 years of its existence have been principally due to the relative freedom of ­operation permitted by the existing Act, the guidance of its board and the presence and support of the RBI as its stakeholder. All these are being sought to be upturned. An institutional legacy is sought to be obliterated by petty-minded and self-serving bureaucrats for whom “institution building” and “vision” are esoteric concepts. It is therefore in the fitness of the things to ensure that the RBI’s role as a shareholder of NABARD continues in the overall interest of the agricultural and rural finance sector of the country. ­Development practitioners, civil society activists, parliamentarians, public persons and the farmers of the country should raise their voice so that a 30-year legacy of the people is not lost forever.........

- P S Rao (psrao.99@rediffmail.com) - Pune-based development professional who has worked with the RBI and NABARD

Click to read more..........

Microfinance: The sole tool for Rural Economic Independence

......As the Banks and Financial Institutions don’t have a direct say in the rural market, the funds are first given to the mentioned organizations which then direct the fund to the respective class based on a mutual perspective. The assets based lending is done by the Banks and financial institutions to cater to the needs based on a specified set of directives. Such directives are issued by the regulators like RBI and the Finance Ministry and some refinement is also done by the respective fund providers.......

Read.....

RBI stonewalls RTI activists on derivatives fraud

The Reserve Bank of India, having first refused to furnish information under the Right to Information Act about the Rs 32,000-crore derivatives fraud despite a Central Information Commission order, is now refusing to reveal expenditure it incurred in challenging the CIC decision in the Delhi high court............

Read - DNA

Eye view on “Foreign Exchange for you”

Workshop-cum-Interface on 

“Foreign Exchange for you” 

organised  by the RBI Jaipur

21 September 2012

CRR cut to pare reliance on bulk deposits: Mallya

Chennai : The cut in cash reserve ratio (CRR) could reduce the need of the banks to go in for large bulk deposits at high rates, Bank of Baroda Chairman and Managing Director M. D. Mallya said here on Monday.......

Read - The Hindu

CRR is an effective tool to cut interest rates: SBI chief

......“We have been consistently of the view that the correlation of the CRR and the bank lending rate is very strong, and if the objective is to reduce the bank lending rate, then CRR cut is possibly the most effective instrument for this purpose,......

Read - The Hindu

Chidu winks, Subbu smiles: Odds on rate cut improve

Are North Block and Mint Street back to bhai-bhai terms? Will we see a rate cut on 30 October? 

The short answer: the chances are 60:40 in favour of a cut, since the finance ministry and the Reserve Bank of India (RBI) are back on talking terms......

Read.......

RBI slaps Rs 5 lakh penalty on coop bank in north Gujarat

......The RBI had issued a show cause notice to the Talod Nagarik Sahakari Bank in response to which the bank had submitted a written reply. "After considering the facts of the case, the bank’s reply and also personal submissions in the matter, RBI came to the conclusion that the violation was substantiated and warranted imposition of penalty," the banking regulator stated.......

Read - BS

Anytime-anywhere banking, courtesy RBI

......The National Payments Corporation of India (NPCI), the organisation set up by the RBI for all retail payments, has now launched the inter-bank mobile payment service for all merchants. This will allow customers to pay their bills for as little as 25 paise for each transaction. NPCI says, mobile phones will be the next walking talking bank. AP Hota, MD and CEO of National Payments Corporation of India said, "Real time money transfer is almost like RTGS for common man. It operates 24*7 and is operational on holidays."......

Read.........

SBI, ICICI lead the pack as m-banking gains currency

......Indeed, there is no comparison between m-banking and the use of credit and debit cards, but experts say the potential of the handheld device in the banking space is significant even as RBI is cautiously moving ahead.......

Read - Mint

Savings rate strategically kept to handle pressure from post office saving: Pratip Chaudhuri

Addressing the media, Pratip Chaudhuri, Chairman State Bank of India (SBI) on Monday termed the RBI's move to cut CRR in its monetary policy review as significant.......

Read - ET

National Housing Bank may cut home loan rate

...... "More than our cost of funds, it is a conscious decision to signal a lower interest rates, which will also result in higher demand and more growth for the industry," NHB chairman and managing director R V Verma told TOI over the phone. Although the housing finance institution's signaling may not have the same impact as RBI, it still holds sway over HFCs, especially.....

Read - TOI

Bank of Baroda to hire 22,000 employees

......According to RBI, the banking sector is expected to grow by 17 percent this year. But Bank of Baroda will out grow the industry's average growth, Mallya said.......

Read.......

Rakesh Mohan tipped to be ED at the IMF

Former Deputy Governor of the Reserve Bank of India, Rakesh Mohan, is tipped to join the International Monetary Fund as Executive Director on the board of the International Monetary Fund. He will get a three-year tenure at the Fund. He will replace Dr Arvind Virmani, whose three-year tenure is coming to an end. As an executive director, Dr Mohan will be representing India along with Bangladesh, Bhutan and Sri Lanka on the 24-member Executive Board of the IMF, which is responsible for conducting the day-to-day business of the multilateral financial institution......

Read - BS

Understanding recent policy initiatives - S.S.Tarapore

......With the Consumer Price Index ( CPI) over 10%, on a year- on- year basis, the need for a cautionary monetary policy by the RBI is understandable. The Mid- Quarter Review of September 17, 2012 has reduced the cash reserve ratio ( CRR) from 4.75% to 4.50%, thereby releasing Rs 17,000 crore of liquidity. The policy move seems to be driven more by monetary- fiscal policy co- ordination rather than any need for enhancing liquidity. The RBI would now be under greater pressure to further liberalise policy at the time of the next review on October 30, 2012. The RBI should not liberalise the monetary policy any further unless there is a visible reduction of the fiscal deficit and a significant and enduring reduction in the CPI inflation rate. The RBI will be in an increasingly difficult bind and resisting political economy pressures would be easier said than done given the RBI- Government power equation......

Read - FPJ

Man stabs dad 15 times over cash for booze

Thirty one year-old Atul Jhemse (centre) confessed to killing his father

A 62-year-old former Reserve Bank of India (RBI) employee was stabbed to death by his son on Friday night for denying him Rs 150 for alcohol. Atul, 31, stabbed his sleeping father Sudhir Jhemse (who retired after working as a RBI clerk in the statistical department) 15 times with a pair of scissors at their residence in Mulund (East). Jhemse has been arrested and remanded in police custody............

Read - Hindustan Times

PNB's Kamath to be chairman of Indian Banks' Association

......The management committee chose Kamath to head the body at its meeting, said a senior IBA official. T M Bhasin, CMD of Indian Bank, is inducted as deputy chairman. The other two deputy chairpersons are Bhaskar Sen, CMD, United Bank of India, and Chanda Kochhar, managing director and chief executive of ICICI Bank......

Read - BS

FDI decision will keep growth story going: RBI officials

Jaipur : ....... The occasion was a  workshop-cum-interface on “Foreign Exchange for you” organised  by the RBI’  Foreign  Exchange Department  here  on Friday. “ Only heavy FDI investment will keep the ‘India growth story’ going,” stated Deepali Pant Joshi, Regional Director, RBI, Jaipur, delivering the keynote address.......

 .......“India is not that vulnerable to economic disturbances as other nations are,” said D.K. Srivastava, Deputy General Manager at RBI Central Office, Mumbai. The day-long event included participation of another DGM from RBI’s Central Office Ajay Vij and other senior officers, besides officers from RBI Foreign Exchange Department, Jaipur, ......

The Hindu : NATIONAL / NEW DELHI : FDI decision will keep growth story going: RBI officials

No change in govt borrowing plan as of now: RBI

Reserve Bank Deputy Governor H R Khan today said there has not been any change in the government borrowing programme for this fiscal as of now.......

Read - Indian Express

Government can help RBI balance objectives

......Monetary policy, till a few days back, was being seen as the sole hope to revive growth in 2013. Of late, the government’s efforts to break the policy stalemate are looking constructive. Such measures, if implemented effectively, can help improve business environment and growth prospects over six-12 months and will eventually offer the RBI better headroom to balance its objectives.

Read - HBL

Banks want NPA norms to be relaxed for housing project loans

......To add to the woes of real estate developers, Reserve Bank of India guidelines does not allow banks to take out that exposure from the NBFC if the project has not been commenced. Now, bankers have requested the finance ministry to take up the matter with the banking regulator so that favourable polices could be framed to boost bank loans to real estate projects.......

Read - BS

Ministry freezes plan to spin off DMO from RBI

In yet another example of the growing convergence of views between North Block and Mint Road, the finance ministry has decided to freeze the long-pending proposal to have a separate debt management office (DMO). Sources familiar with the developments said following Finance Minister P Chidambaram’s reinduction as the finance minister, the Reserve Bank of India (RBI) wrote to the ministry, reiterating its objection to the proposal and its concerns over a separate DMO. The central bank’s views also had board approval.......

Read - BS

Separating India's twin deficits

......The difficulty of controlling inflation with supply-side measures means monetary policy will have to remain hawkish and contain aggregate demand. The RBI recently said it would “reinforce” the government’s pro-growth policies. That has given rise to expectations that more rate cuts are on their way to supplement a half-percentage-point reduction in April. This is not the time to allow such expectations to take hold. Rate reductions should be part of next year’s policy agenda when the government has demonstrated the success of its resolve to stop the fiscal haemorrhage and after inflation has lost its sting.......

Read - BS

Why banks aren’t cutting loan rates

......Why aren’t the banks lowering their low rates? They cannot do so because their bad assets are growing and they need to set aside more money to take care of that. Besides, they are also setting aside money for the statutory dues of their employees, such as pension and gratuity, which they had not done before. The impact of the combined provision on their balance sheets is quite big. On top of that, if they want to cut their loan rates, their interest income will go down, and that will affect their profitability......

Read - Mint

CRR still serves a purpose

The debate will continue......

......It fulfils an important regulatory function in countries such as India where the Open Market Operations (OMO) that central banks use to check liquidity face some structural rigidities. Central banks rely on CRRs to check inflation by varying money supply. An increase in CRR lowers the multiplier, and, hence, the growth of money supply. The opposite result happens when the CRR is lowered. Banks ought to view the zero interest on CRR balances as a fee paid to the RBI for its supervisory function. Banks alone can mobilise low-cost savings and current account deposits. Mutual funds, NBFCs and insurance companies do not have access to such funds. So, banks are not disadvantageously placed in having to meet CRR obligations......

Read - The Hindu

An artificial paradise

Data on rural wages in different states and occupations released by the Reserve Bank of India (RBI) last week throws interesting light on India’s rural economy. When read together with data on consumption released by the National Sample Survey Office (NSSO) early last month, they confirm many of the trends that have been written about in past years.......

Read - Mint

Efforts for total financial inclusion

Efforts are on to make Ernakulam the first district in the country to achieve meaningful financial inclusion as per RBI norms. RBI Governor D. Subbarao will declare the achievement at a function to be held in the district on November 22, the lead district bank Manager K.R. Jayaprakash, told The Hindu.......

Read - The Hindu

Reforms, RBI give some help to your finances

......With the recent cut in CRR by RBI, there is a strong possibility of banks reducing their lending rates; implying lower EMIs for new borrowers and also for existing ones. Over the last couple of weeks, some banks have already taken the lead to reduce rates – both on loans as well as on deposits. Although the reduction in EMI will be welcome for borrowers, the same may get offset by the lower yield on bank deposits......

Read - BS

Presence of women staff more in South-based banks

......According to Usha Ananthasubramanian, Executive Director of Punjab National Bank, South India has been a forerunner in women’s education. This could be a reason for more women here taking up employment, such as bank jobs, than their counterparts in some of the northern States......

Read - HBL

Window-dressing of deposits by banks: Some truths

......The phenomenon of window-dressing continues despite the RBI’s warnings and suasion. The RBI’s concern is evident from its Business Season Credit Policy, 1995. To quote, “Banks have been repeatedly warned to eschew window-dressing and it is unfortunate that despite strong suasion this warning has been ignored. Banks are cautioned once again against the recurrence of such a phenomenon and I am constrained to say that we may have to evolve certain arrangements, including punitive action, to prevent the recurrence of such a phenomenon.” (Paragraph 5 of the RBI Governor’s letter to SCBs on September 29, 1995 detailing the Busy Season Credit Policy......

Read - HBL

Maharashtra is No. 1 in bank heists in country

......"Police and banks haven't fully availed of scientific developments in security. Once UID and CCTV projects are completed it may be easier to track criminals. Innovations like ATM-type cash chests within banks, linking alarms with other security establishments and police networks, placing sensors in a couple of cash bundles etc can go a long way in curbing bank heists."......

Read - TOI

19% rise in circulation of counterfeit notes: RBI

......Kolkarkar had submitted RTI queries with the RBI demanding number of fake notes recovered under RBI's Nagpur region (Nagpur, Vidarbha and Marathwada). In its reply, the RBI said the number of counterfeit notes detected by banks increased to 5.21 lakh pieces in 2011-12 from 4.35 lakh in the previous year, an increase of approximately 19%. The data shows that maximum counterfeit notes were detected for Rs 500 denomination followed by Rs 100.......

Read - TOI

State Bank of India, Bank of India allowed to operate in Pakistan

......India and Pakistan have agreed to allow two banks each from both the countries to set up branches across the border, governor of the State Bank of Pakistan, Yaseen Anwar said today. "We have held discussions with the Reserve Bank of India and both sides have agreed to issue a full banking licence to two banks of each country,".....

Read - TOI

Customers confused when it comes to new bank accounts

......However, the phenomenon gained real momentum when the Reserve Bank of India (RBI) deregulated interest rates on savings accounts. For the ease of operations and uniformity, RBI further issued guidelines and categorised savings accounts as Basic Savings Bank Deposit Account and value added savings bank deposit account. Whether you simply call it sheer business or the target set by the Government - to have at least one bank account every household - there is a paradigm shift towards the way banks have treated savings bank accounts.......

Read - The Pioneer

Hundreds suffer as ICICI bungles

......Even the Prevention of Money Laundering Act, 2002, says banks have to keep multiple hard and soft copies in a manner as may be specified by the Reserve Bank of India. But ICICI did no such thing. Apart from closing and suspending accounts, the bank lost three-in-one online trading account opening forms of 440,000 customers and account opening forms of 55,000 NRIs, according to information obtained under the Right to Information Act (RTI).......

Read - DNA

Bank ATMs stop sucking in cash after RBI direction

Next time you go to an ATM to withdraw cash, don't worry about the banknotes getting sucked back by the machine if not collected immediately, as RBI has asked all banks to immobilise the 'cash retraction facility'. At the same time, customers will have to be extra careful in collecting the cash dispensed by the ATM, as they cannot later claim the money from the bank, which was the case when this 'cash retraction facility' was in place at the ATMs.......

Read - BS

Nabard wastes Rs. 22 crore, government ignorant

......A Right to information Act (RTI) query in June 2012 revealed that the BCG was given Rs13.2 crore for the process, but the company did not produce any report. In fact, DNA found that Rs13 crore was the initial amount and an additional Rs9 crore was given to BCG later. Dr Bakshi was primarily instrumental in getting the BCG involved. “In exchange of Rs22 crore, Nabard did not get anything. The consultants should come out with reports that become the framework of restructuring,” said Dr KG Karmakar, former Managing Director of Nabard. He had opposed the selection of BCG when he was at the helm of affairs. ......

Read - DNA

Get the rupee off this roller-coaster

......In his recent address to the annual forex assembly of the Forex Association of India, G. Padmanabhan, Executive Director, Reserve Bank of India talked about the inadequate response of companies to forex fluctuation, misuse of hedging facilities by companies and banks and the growing clout of currency futures segment. Mr Padmanabhan reiterated the central bank’s view that a volatile rupee is the ‘new normal’ and corporate India has to learn to live with it. But most companies have not made optimal use of the hedging instruments available......

Read - HBL

Banks capable of tiding over NPAs mount, says RBI deputy governor Anand Sinha

MUMBAI: Reserve Bank Deputy Governor Anand Sinha today said banks' asset quality has deteriorated in recent times due to the gloomy economic conditions but noted that there is enough capital with the lenders to take care of the situation. "Yes, there is pressure on asset quality and at the same time we have enough capital to sustain that," he told reporters on the sidelines of an Economic Times event here.......

Read - ET

Dynamic provisioning can contribute to financial stability: RBI

......“While there is no guarantee that dynamic provisions will be enough to cope with all the credit losses of a downturn and therefore may not tame credit cycles by itself, the time has come for forward looking provisions which when properly calibrated can act as a dependable macro-prudential policy instrument, to hedge against risks in banks’ balance sheets thereby enhancing the resilience of both individual banks as well as banking system as a whole.”......

Read - BS

Demystifying banking jargon

In its efforts to keep inflation under check and spur economic growth, the RBI has a quiver full of arrows that it uses to control the flow of money into the economy.......

Read.......

Economy, banking system and borrowers

......With the inflation levels not relenting at all, the expectation on rate cut seems increasingly a pipedream. But the good news is that the indication of such cuts to be announced by RBI in its October 2012 credit policy seems to be positive. New home loan seekers and existing borrowers can expect some cheer in the coming weeks.......

Read - The Hindu

Government to handle selection of auditors for public sector banks

......The finance ministry is expected to issue a directive on the issue soon. "We are in consultation with key players. We expect to issue the directives in the next few days," the official said. The issue of public sector banks selecting auditors on their own had earlier been flagged by the Institute of Chartered Accountants of India (ICAI), which said the appointments should be done by an independent regulator, such as the Reserve Bank of India.......

Read - TOI

Faulty water purifier rectified

......G. Valliswar, editor of the State-owned magazine Andhra Pradesh and one of the schoolmates of the RBI Governor, took up the issue with the MA and UD Commissioner. The students could drink potable water again.

Read - The Hindu

Around 300 students from Jharkhand to take part in RBI quiz

About 300 students from 50 schools of Ranchi, Bokaro, Jamshedpur and Dhanbad would represent Jharkhand in the RBI quiz by Reserve Bank of India......

Read - The Pioneer

ATM robbers from Mohali

THIRUVANTHAPURAM: The recent series of ATM robberies in Kollam and Thiruvananthapuram districts caught even the Reserve Bank of India (RBI) off guard as robbers capitalised on a very weak computing system deployed by banks in their ATMs. ......

Read - TOI

RBI notifies government’s decision on FDI

The Reserve Bank of India (RBI) on Friday notified the government’s decision to allow FDI in multi-brand retail, civil aviation, broadcasting and power exchanges.........

Read - Mint

Gold loans won’t lose their shine despite RBI imposing strict lending rules

......After the Reserve Bank's new rule, NBFCs changed the way gold is valued to include making charges and also tax. This is how it used to work: if the gold content in a piece of jewellery is valued at Rs 100, a loan of Rs 70 was typically possible. Now, to the Rs 100 are added making charges (say, about Rs 10) and the VAT (12%). So, the loan is given on the replacement cost of the jewellery — Rs 123 (Rs 100 + Rs 10 + Rs 13). And 60% of Rs 123 is greater than 70% of Rs 100; so the new norm doesn't look bad......

Read - ET

Fraud-hit emu farming industry flies North

......“Either RBI (Reserve Bank of India) or Sebi (Securities and Exchange Board of India) should be responsible for this. Often they take the cover that it was never brought to their notice. It is all over the newspapers. What more notice do you want?” said R Balakrishnan, a former financial services professional and an independent adviser based in Chennai.......

Read - BS

Peerless Group gets RBI nod to enter consumer loan business

KOLKATA: The Peerless Group has received a new lease of life as the Reserve Bank of India has allowed the group to foray into consumer loan business.  Peerless General Finance and Investment Company (PGFI), once a household name for poor depositors in the eastern and the southern markets, ran into a difficult phase with declining earnings after being forced to phase out its deposit-taking business.......

Read - ET

Can you really Bank on them?

......To a Right to Information (RTI) query, RBI has confirmed that 36 banks operating in Kerala have reported banking frauds of over Rs 260 crore......

Read - TOI

Loan-some blues

......Should existing customers switch loans now? While the rate cuts sound attractive, do the maths to figure out how exactly a 0.25 percentage point cut affects your loan. Remember, banks have not reduced base lending rates; they have simply selectively cut rates on some loans.......

Read - The Hindu

RBI voices concerns on separation of DMO from Central Bank

The Reserve Bank of India (RBI) has once again voiced concerns on separation of Debt Management Office (DMO) from Central Bank. “Separation of debt management from Central Bank needs to be revisited in the wake of global financial crises,” said H R Khan, Deputy Governor, RBI at a conference in Doha recently.......

Read - BS