Twenty years ago, the Indian banking system was in a crisis. Reform of public sector banks was the cornerstone of the economic reforms that were unveiled then. The government and the RBI had just introduced new norms for income recognition, provisioning and capital adequacy for Indian banks in line with international norms. It was a reality check for banks and they failed it badly. Till then they had been run in a manner completely at variance with sound prudential norms. The focus was only on...........
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.
Thursday, February 28, 2013
It’s not prudential to bank on discretion
.....For example, under “Procedures of RBI Decisions” the guidelines state, “Licenses shall be issued on a very selective basis to those who conform to the above requirements, who have an impeccable track record and who are likely to conform to the best international and domestic standards of customer service and efficiency.” There is no qualification of how “impeccable track record” will be determined or how “best international and domestic standards of customer service and efficiency” is defined........
RBI giving awareness to security personnel on FICN
SHILLONG, Feb 27: The Reserve Bank of India (RBI) is constantly giving classes and awareness to the security personnel deployed in vulnerable places where the marketing of Fake Indian Currency Note (FICN) is taking place, informed GM (O-in-C), RBI, P Shyam Sunder, here on Wednesday. Speaking to reporters, Sunder said, “RBI’s role in keeping a check on the floating of FICN in the market is the first line of defense.”...........
Coin scarcity due to people’s habit
SHILLONG, Feb 27: Holding of smaller denomination of coins by the people has led to the extinction of small coins from the state, claimed P Shyam Sunder, GM (O-in-C), RBI, here on Wednesday. Speaking to reporters, Sunder said that scarcity of smaller coins in the state has no doubt haunted the state.........
Rupee Coop Bank to propose relaxation in withdrawal limit
.........."Many pensioners, small
and medium business enterprises and charitable institutions are
suffering because of the restrictions on withdrawal imposed by the Reserve Bank of India
(RBI). We will draft a proposal recommending increase in the limit from
Rs 1,000 per day per person per account to Rs 5,000 for pensioners and
people under medical treatment. The limit can be increased to Rs 1 lakh
for charitable institutions."..............
Constable on duty at RBI office shoots himself
CHENNAI: A Chennai city police constable attached to the armed reserve wing shot himself with the government supplied weapon in his possession on the Reserve Bank of India (RBI) campus here on Wednesday evening. The bullet pierced his chest, and he is being treated in a hospital, police said. Mahendra Perumal, 26, from Ramanathapuram, was assigned guard duty on the RBI campus. Around 5.40pm, he pulled the trigger of his self loading rifle. His colleagues found him bleeding from the left side of the chest..........
Gem of a person looses fight with cancer..........
We are grief-striken to inform
that the former President of the Reserve Bank Retired Employees
Association Chandigarh and Ex-General Manager, Sushil Kumar, who was suffering from cancer for
the last 2 years, is no more. The cremation took place at 3.00 PM on 27-2-2013 at Ram Bag Cremation Ground, Kharar.
- R.K.Pahuja
Deeply aggrieved to know about sad demise of Shri Sushil Kumar. I worked
with him at Chandigarh in early nineties. He was gem of a person.
- Baldev Raj Chopra
We
the members of EXRBITES pay our heartfelt tribute to Shri Sushil Kumar ji and pray to God to grant eternal peace to his soul and give
courage to family to bear this loss. For the last 2 years he was
putting up a brave fight with cancer. You may recall that many of you
had sent "Get well soon" good wishes to him in response to my mail date
19th September, 2011 when he underwent a operation at New Delhi. A few times I met him I was surprised to see his
confidence. It was beyond my capacity to imagine how a person who knows
that he is suffering from such a life threatening disease still could
talk with so much cool. Such was his will power. Ultimately he bid final
farewell to us all today morning. May his soul rest in peace for ever. He
retired as GM from Chandigarh office on 31st July,1999. He was
Ex-President of Reserve Bank Retired Employees
Association. EXRBITES is indebted to him for giving full
support in giving shape to the Group. He was a very cordial man and
ready to help any one in case of need. He is survived by his son Sh
Aseem Kumar Sharma.
grief stricken
- Madan Gauria
Pai, Ramanathan, NRN: Will diverse applications change Indian banking?
........The entry of finance professionals is bound to make the banking sector interesting since it will also usher in new wave of technical know-how...............
In public interest
...... There are enough grounds, then, to be cautious in granting bank licences to entities primarily engaged in real estate or broking, if only to prevent the prospect of depositors’ monies being funnelled into these businesses. If the RBI, in the light of the feedback received on its draft norms, felt that the denial of banking licences to those in real estate or broking business would be unfair, it would have been perfectly in order for it to delete it altogether.........
The anatomy of regulatory independence
Since, barring the Reserve Bank of India (RBI), financial sector regulators in India came in later than those in developed markets, the debate on independence here started somewhere in the mid-2000s, with the intelligentsia generally supporting it. However, the global tide turned sharply in the aftermath of the 2008-09 crisis, after which the very same autonomy was vilified..........
Empowering the poor through mobiles
.....While deeply intertwined to e-governance, it has emerged as a separate domain aimed specifically at addressing the digital divide in access to government services and programmes. However, by themselves, they cannot be effective in development or governance. To make them act as catalysts in this process, policies need to be in place to support access to information, development of relevant content and services in the local languages, an enabling infrastructure, and an effective awareness and communication campaign aimed at the end users. Recent initiatives by the RBI for mobile based financial inclusion and by the Department of Electronics and IT to make mobile based provisioning of government services mandatory by all government departments and agencies offer great hope to achieve this vision.
Dip in inflation makes case for rate cut
With wholesale price inflation moderating and the government's fiscal situation expected to improve, there is room for further interest rate cuts by the Reserve Bank of India (RBI), according to the Economic Survey released today. "There has been some moderation in inflation in the third quarter (October-December) of 2012-13 and with the expected fiscal consolidation, the current macroeconomic situation creates room for a somewhat accommodative monetary policy," said the Survey.............
Super-rich tax? Redo the I-T slabs first
.....The number of income brackets may be kept at seven. In other countries, it varies from four to nine. The Gini coefficient that measures inequality - one representing maximum inequality and zero the minimum - would swing towards one if there are fewer income brackets causing greater inequality. Also, keeping the number of income brackets low would make the progression from minimum to maximum steep, and encourage the people make all efforts to keep the income within the lower income bracket to avoid tax. Having too many income brackets, on the other hand, would render it complex for calculation........
Fruitful decision
....... As an official explained, the tall, fruit-producing mango tree would signify that the CPC's efforts would also produce good results. Neem, on the other hand, has many medicinal values and just like income tax, it is a bitter pill that has to be taken.
Farmers as capitalists
......supporting agencies such as the Reserve Bank of India (RBI) and the National Bank for Agriculture and Rural Development (Nabard) are yet to frame detailed guidelines for bank lending to such organizations. It is worthwhile to keep in mind that bank lending to self-help groups grew phenomenally in the 1990s only after RBI and Nabard jointly framed guidelines for such groups, and prodded banks to step up group lending..........
Rao committee: A halo for gold loan NBFCs
The release of Reserve Bank of India's (RBI) KUB Rao committee report on gold has brought a breath of fresh air. The awareness of gold loans had grown well beyond the south and gold loan
players, especially the biggies, have been growing at a brisk pace. The
RBI had some concerns, which it laid down with a slew of measures it
deemed fit. While these were more of hygiene factors, what
followed was a dialogue between the gold loan players and the regulator
to explain the business model, risk management
measures, the role the sector played in financial inclusion and the
sector's efforts to address customers, who even today are being
exploited by moneylenders and pawnbrokers. The Rao committee's
recommendations reiterate this and articulate a perfect mix of what it
feels about the sector and what it is expected to do going forward...........
Wanted: Budget With Equitable Burden Sharing - S.S.Tarapore
....Implementing the main recommendations of the RBI Report of the Working Group on Gold would be a strong signal. The setting up of the Gold Corporation of India (Gold Bank) and specific measures to activate idle gold hoards would reduce gold imports. Any further increase in the gold import duty will result in illicit imports.................
RRB employees to observe dharna tomorrow
......A large number of officers and employees from all the five Grameena Banks in the state would take part in the agitation to be held from 1030 hours, a press release from Andhra Pradesh Regional Rural Banks Employees Association here said. CPM State Unit Secreatry B V Raghavulu will inaugurate the Dharna and leaders from the Association of RBI, NABARD, Commercial Banks and RRBs should participate in the programme.....
RBI says economy not sole reason for mounting bad loans
....“We have to arrest the trend (of rising NPAs),” RBI Deputy Governor Anand Sinha said in his keynote address at the Mint Annual Banking Conclave in Mumbai on Wednesday. “This is a concern but it is not a systemic risk, it needs to be monitored.” Banks need to tighten their credit monitoring mechanisms and use the debt-restructuring facility to support stressed borrowers, Sinha said..........
The Reserve Bank of India is taking quite a gamble with India’s economic future
.......I have two thoughts for you. Firstly we may be entering a new paradigm where emerging and expanding economies have a different set of rules to the mature ones but can they be this different? Secondly if you add in the promises of further action the RBI has taken quite a gamble here but if it fails it will be the Indian population who will feel the pain.
Read...............
Read...............
Clear regulatory hurdles: Survey
......“The government is committed to fiscal consolidation. This, along with demand compression and augmented agricultural production, should lead to lower inflation, giving the RBI the requisite flexibility to reduce policy rates,”.......
Union Budget 2013: Survey indicates scope for RBI to ease more, says Pan
.....It is underpinned on the fact that we should be seeing lot more monetary easing from the Reserve Bank of India (RBI) as it clearly says that there is adequate scope for the RBI now to act. It also underpins on the fact that we are looking at a fiscal consolidation. Unfortunately what we may be missing out immediately is that there is definitely a challenge in terms of investments picking up because the visibility of demand globally, as well as in India .......
The Survey’s tired stories
.....The report’s view that the stimulus fed inflation is another back-handed self-compliment to its growth-generating abilities. Inflation had already hit the economy during the high growth period and interest rates had begun climbing during Y. V. Reddy’s term at the RBI......
Economic Survey reaffirms RBI view on GDP growth rate: BJP
......"The Economic Survey has said the GDP growth rate is 5%. This is a matter of serious concern. It brings us close to reality as when the RBI had said growth would be at 5% the government had questioned its veracity. The Survey reaffirms the RBI view,".........
Wednesday, February 27, 2013
'Reforms Should Centre On The People Of India’
 |
| .........In the long-term, the goals of reforms cannot be about growth for the sake of growth without looking at the expectation of what constitutes healthy and happy life for most people of India. As Gandhiji pointed out, there is enough to meet everybody’s need, but not everybody’s greed. That should be the foundation for the debate of reforms in India now...... |
Celebrating Indian Banking
.......While the winners drew applause, it was Y V Reddy, recipient of the FE Lifetime Achievement Award, who had the crowd in splits with his quips. "I take this award as a recognition for the importance of public policy in general," Reddy said in his acceptance speech, "I have been told that this award is for the lifetime achievement as a banker but I've spent the major part of my career as a non-banker. Some even thought I was an anti-banker during my stint as the RBI governor."........
RBI Deputy Governor Sinha gets nearly 11-month extension
Chidambaram meets RBI Governor ahead of budget
Ahead of the Budget, Finance Minister P Chidambaram on Tuesday held consultations with Reserve Bank Governor Duvvuri Subbarao in New Delhi............
Onus is on RBI to find ‘fit and proper’ bank licencees
.................The ultimate safeguard, however, is the RBI’s ability to take an unbiased and independent view on who is ‘fit and proper’ to promote a bank. As long as that is not compromised we need not fear. Now more than at any other time, the RBI must strive to guard its relatively clean image..............
The charm of owning a trophy bank
......It makes sense for an NBFC to become a bank and for the financial arm of a corporate biggie (say, the financing arm of a car manufacturer) to become a bank. But given all the restrictions there will be to prevent a bank from extending help or accommodation to anything linked to its promoting group, the question really is: what is there in a bank licence for a large business group? It can access any amount of institutional finance at home or abroad, and a new bank will take a long time to make real money. A bank will allow a business house to dispense favours to lesser business mortals; beyond that, the most powerful business houses may be using their clout to own a bank simply because they find it prestigious to own a trophy bank.
Realtors, brokerages free to run banks if they meet norms: RBI
 |
| "These are all legitimate businesses...if they can demonstrate that they satisfy all the requirements, all the concerns...how can you deny them... definitely, if this is not in the guidelines, then it is open," |
Relax norms for foreign banks in India, says Japan
.....Japan has asked the government and the Reserve Bank of India (RBI) to relax the norms concerning financial inclusion for its banks. According to the present norms by RBI on foreign banks, these lenders would have to first open branches in non-metros and then shift to urban centres......
Prudence is key for India's bank hopefuls
.....Will a severely under-banked country like India, where financial inclusion has been more of a utopia (what with virtually half of India's population not having any bank accounts), see a change for the better? Don't count on it now, though the Reserve Bank of India (RBI) has, after years of deliberations, laid down norms for granting new banking licenses. However, what is important to note here is that pragmatic policy making (I would resist myself from calling every policy initiative as reform) is finally back in the limelight.....
Setting up a new bank? Pause and proceed
.....The ‘feel good’ in business circles, especially considering that the RBI has allowed applications from quarters that were speculated to be possibly excluded, is clearly visible and understandable. The fact that the RBI has indicated a meaningful timeline and evaluation process is equally welcome.....
Mohandas Pai, former Citibank executive Ramesh Ramanathan in race for licence to start a bank
Mohandas Pai and former Citibank executive Ramesh Ramanathan will be part of the business groups throwing their hats in the ring for a licence to start a bank. By doing so, the finance professionals will be joining what is expected to be a fierce competition for entry into a sector that has not admitted new players for nearly a decade.............
Back to square one at K.R. Circle
.....The city’s first signal-free junction, set up by the Bruhat Bangalore Mahanagara Palike (BBMP) at K.R. Circle at a cost of Rs. 1 crore, is back to square one with the traffic police installing signal lights there. Vehicles coming from different directions passing through this used to pile up on Nrupatunga Road, which is a sensitive area, what with the Reserve Bank of India and police headquarters situated on the road, besides official residence of the State police chief, said a police officer.......
Rupee bank board of directors dissolved
PUNE: The board of directors of city based Rupee Cooperative Bank Ltd was dissolved on Tuesday following directives by the Reserve Bank of India (RBI) and a two member administrative board headed by joint registrar (sugar) Sanjay Bhosale was appointed by the state cooperation commissioner. The other member of the board is Vidyadhar Anaskar, chairman, Maharashtra State Urban Cooperative Banks' Federation Ltd and Vidya Sahakari Bank Ltd. .......
Over 60,000 ATMs to be opened in rural areas in 2 years: Govt
......Replying to supplementaries during Question Hour, Minister of State for Finance, Namo Narain Meena, said "there is shortage of ATMs and effort is being made to provide as many ATMs as possible in rural areas." "More than 60,000 ATMs will come up in rural areas in coming two years," he said. Meena said the government and Reserve Bank of India are encouraging electronic payment system in the country.........
Coming soon, plastic currency
.......RBI officials said though the intention to introduce polymer currency was announced earlier, no intimation had been received yet on commencing the experimental distribution. Meanwhile, the apex bank is preparing itself for distribution of 10-rupee coins across the country on a large scale. The 10-rupee coins have already been launched, but are available only in limited quantities.
Pvt banks detect maximum fake notes: Finance ministry
Private banks operating in the country have detected and processed the maximum number of counterfeit currency instances in banking channels surpassing both public sector and foreign banks by a huge margin, an official report of the Finance Ministry has said...........
Cyber fraud costs banks Rs 130 crore in 3 years
............"The RBI has issued stringent guidelines, advising the banks to take preventive measures to combat frauds relating to skimming or duplicating of credit cards. In addition, specific instructions have been given for reporting the case to the CBI or police, examine staff accountability and complete proceedings against erring staff expeditiously,''...........
RBI, Nabard examining errors in farm debt waiver scheme: P Chidambaram, Finance Minister
Amid CAG pointing to errors in implementation of the farm debt waiver scheme, government today said RBI and NABARD are examining the case and action will be taken against banks found involved in irregularities and the ineligible beneficiaries..........
Tuesday, February 26, 2013
Protein portents - Subir Gokarn
FinMin panel shortlists 21 bank GMs for ED selections
.........In the recent time, public sector banks are grappling with the staff shortage be it at the management level or at the branch level. According to media a report, PSU banks are planning to hire around 56,500 people in next six months across junior to middle management levels. There was a six-member interview board, which took interviews. They were Rajiv Takru, secretary - department of financial services; Anand Sinha, Deputy Governor - RBI, Jagdish Capoor, former Deputy Governor - RBI (1997-2001) and a few other experts.........
Nabard plans Rs. 9k cr credit outlay for state
.......The
outlay was released at the state credit seminar titled, ‘Development of
rural infrastructure for accelerating inclusive growth’, by Nabard on
Monday. The release of credit outlay is part of the 12th Five Year Plan (2012 to 2017). Among
those present on the occasion were Sudhir Kumar Goel, additional chief
secretary, state agriculture and marketing department; M V Ashok, chief
general manager, Nabard regional office; J B Bhoria, Regional Director,
Reserve Bank of India; C V R Rajendran, executive director, Bank of
Maharashtra and Rajagopal Devara, state cooperation secretary. P M Ghole, general manager at Nabard’s regional office, presented the bank’s focus paper for the coming fiscal.........
Repo - No questions asked - A.Seshan
......Any short-term access by banks of RBI, the lender of last resort, should be after they have exhausted all possibilities in the inter-bank market. But the central bank follows the Biblical dictum: “Ask and it will be given to you; seek and you will find; knock and the door will be opened to you” (Matthew 7:7). ........
My View on "Don’t lower your guard"
Ideal situation in which regulators and supervisors can function with autonomy within the legislative mandate does not exist today. GOI through Finance Ministry has been pulling and pushing RBI ever since the idea of new bank licenses got momentum a couple of years back. RBI had limited options. One, rush through the formalities and give half a dozen bank licenses to those who could ‘manage’ them in the given dispensation. Two, go through some semblance of rational procedures and buy some time when the central bank could convince GOI about the dangers in giving banks to ‘manipulators’. Three, convince GOI that financial sector reforms and consolidation/overhaul of existing banks was a priority and no immediate purpose will be served by allowing new banks. Now, it seems RBI is going for a fourth option, namely, accept applications from all, give licenses to some under pressure, some to genuine aspirants and some others whom RBI would like to 'discipline' by converting them into banks.
- M.G.Warrier
Unrealistic policy prescription
 |
..........For India, a Reserve Bank of India study assessed that “productivity differential, foreign assets, terms of trade and openness are main determinants of real exchange rate.” One OECD study done in 2011 did not find any support for B-S-H based on current trade data. It is odd that contrary to available evidence based on a plethora of research on exchange rates, Bhalla takes the line that real exchange rate can be influenced by nominal (policy) exchange rate. It is difficult to categorise this book. It is not an investment analyst’s guide to recent trends in currency rates and their impact on trade and growth. It is not an economist’s study of linkages between them. Its statistical base is questionable even as its theoretical base is weak.........
|
Read - The Hindu
Money breeds problems
RBI has issued guidelines/conditions for new private sector banks. The conditions are very stiff. All news papers and channels have hailed the move. The existing private banks cater to the needs of the upper middle class and above category while public sector banks serve poor Indians. RBI should also stipulate one more condition that these new private sector banks shall maintain a separate banking entity for at least 10 years from the date of business commencement. From the list of old private sector banks, many names—Times Bank, Centurian Bank, Bank of Punjab—are missing. Because of irregularities, Global Trust Bank was merged with a public sector bank to protect depositors' interest. This shows that private banks do not necessarily mean efficiency. Efficiency in service is different from efficiency in banking operations, particularly advances/loans recovery. Money means problems, whether it is shortage or excess.
- Sudhir K Bhave, Mumbai (FE)
Bankers' banquet: Follow up on the liberal guidelines with a few dozen new banking licenses
........Providing bank licenses to all deserving applicants is important because the RBI had so far placed a tight leash on new banks. This has ensured that India remains a relatively underbanked economy with about only 80 odd banks, of which around a third are foreign banks with a few branches each, serving a population of 1.2 billion people. Consequently .........
Making India more bankable
......The RBI had made new bank licences conditional on being given a bigger regulatory stick. The Centre has been seeding much of the banking sector’s growth through taxpayer money, but a generation of private banks has established deep roots in the system through technological advances, modern management and a vastly improved customer experience. With an oversight mechanism in place, banking can now draw in fresh capital.......
After the hype, analysts say RBI may offer just 5 new bank licences to India Inc
The Reserve Bank of India (RBI) may not issue more than five new bank licences as the central bank wants to be very selective initially, analysts said. "We do not expect the RBI to issue more than five licences. We believe the probability of a public sector entity obtaining a banking licence is low," ........
On your marks, get set ...
...... Three years ago, the then finance minister Pranab Mukherjee, had first announced the government's intention to bring new banks into the fold. Since then, RBI not only kept alive an engaging debate on the topic but also ensured that the government put in place an enabling legislation for the apex bank to issue new bank licences.......
NBFCs may not benefit by becoming banks
....Since the main lending business of an NBFC has to be converted into a bank, it will attract regulatory requirements such as cash reserve ratio (CRR), statutory liquidity ratio (SLR), and priority sector requirements from day one, “which will be substantially return dilutive”,...........
Non-banking financial companies to decide later on bank licences
Kerala-based non-banking financial companies (NBFCs) are taking a 'wait-and-see' stand towards the Reserve Bank of India's (RBI) guidelines for applying for new bank licences............
SKS to decide on banking foray in May
............SKS Microfinance, once the largest micro lender in the country, will decide on applying for a banking licence in its board meeting in May. The Hyderabad-based microfinance institution, which emerged out of the crisis relatively better than its rivals, is currently evaluating the pros and cons of entering the banking business. “We are yet to take a call. The board will discuss whether we should apply for a banking licence,” ............
New entrants may face hurdle to man branches in unbanked areas
....."While private banks may be able to retain their rural talent with better salary, public sector banks, including the large ones, may be constrained by their inability to pay exorbitant salaries to retain people," ..........
Don’t see any danger of wrong cos getting into banking sector: Rajiv Takru, Banking Secretary
............It is very difficult for me to answer as to what made the RBI change its mind. The draft guidelines were put out by the RBI sometime back. There was a lot of feedback after that. The Indian Banks Association also gave their comments. We were in continues discussion with the RBI. There were all kinds of other stakeholders who are talking to them and the pros and cons were evaluated over a period of time. There was no history decision making and ultimately what has come out is perhaps the fairest configuration which they could have worked out............
Shriram Group to enter the fray
........At present the group has two NBFCs -" Shriram Transport Finance Corporation (STFC) and Shriram City Union Finance (SCUF) -" which have assets under management (AUM) to the tune of around Rs 50,000 crore and Rs 15,000 crore respectively. These two companies fund businesses, which provides livelihood to the borrowers. Group Director of Shriram Group G S Sundararajan, who was identified by the Group to head the Banking initiative, said that the new guideline was not different and it was largely in line with what the preliminary guidelines were............
Making India more bankable
......The bank licence rules reinforce a form of universal banking that India may have outgrown. Fresh thinking on the spread of banks in the country has stopped short of segmenting the market for credit. Financial inclusion could be better served by sector-specific bank licences, where every new bank does not need to become a supermarket for financial products. State-controlled focused banking, like that for agriculture, has delivered mixed results. Private banks could bring in innovative new solution.
Not a good idea
Back in 1969, the controversial nationalization of fourteen private banks was a political move clothed in socialist mumbo- jumbo. Apologists of Indira Gandhi argued that these banks serviced big business while failing to meet the needs of the ~ aam aadmi~. Her Congress rival at the time, Morarji Desai, had opposed nationalization, saying the above objective could be well served through the RBI- monitored ` social control' of the same banks. Mrs Gandhi had her way. Fourteen large private sector banks were taken over. If nearly forty- four years later, the state of the banking in the country continues to be rather poor, you know whom to blame. Playing partisan politics with financial institutions does not pay.........
Sucidal
Opening up the banking sector to conglomerates will not do any good for the Indian economy (“Don’t lower your guard,” Feb. 25). We saw many private sector banks which sprouted perish in the face of stiff competition. The trauma of their customers and employees till they were rescued by public sector banks cannot be explained in words. The government’s latest move is suicidal.
C. Petson Peter, Kochi (The Hindu)
The government’s undue haste in pushing through licences for new banks, in spite of resistance from the RBI and the IMF, makes the common man curious. With the general elections round the corner, speculative sectors which finance the elections are at an advantage. Of all the sectors, the financial sector is the fulcrum of the economy. It is not only money but also trust that matters. The government’s stand of welcoming big global banks, on the one hand, and making financial inclusion a priority, on the other, is indeed strange. Our banking system is robust enough to take care of the needs of our economy.
S. Veeraraghavan, Madurai (The Hindu)
NEW RBI RULES FOR INTERNATIONAL BANKS
..........“Branch
banking licences to some Australian and Chinese banks in the recent
past have a clause that states the bank would have to migrate to the
wholly owned subsidiary model as and when the Reserve Bank finalises the
guidelines,” said one of the persons, who did not want to be
identified. The action, coming more than two years after the RBI
first signalled its intention to ask foreign banks to incorporate local
units to ring-fence them from global risks, may well be a significant
step in the banking regulator’s key unfinished task of ensuring financial sector stability.........
Poor on Banks
This
refers to ‘Broad and Welcome’ (ET, Feb 25). Technology and expansion of
the banking sector is only applicable to cities and urban areas. Our
banking industry has failed to cater to the needs of rural and poor
people and they continue to depend on moneylenders. Even if branches are
opened in rural areas, they are mainly opened in prosperous villages,
neglecting the backward areas. Financial inclusion does not mean opening
branches in villages and unbanked areas but educating the rural people
on the benefits of modern banking and bringing them into the banking
arena. Secondly, fresh recruitment of staff is needed given the vast
retirements that are due in the public sector banks. It is no use
opening new branches when there just isn’t adequate staff to man them.
- VEENA SHENOY, Thane (ET)
- VEENA SHENOY, Thane (ET)
For a social cause
Cosmos
Co-operative Bank is committed to extending financial assistance to
women's self help groups to help them to become self-sustainable.",
stated Krishnakumar Goyal, chairman-in-charge, Cosmos Bank, at women's
gathering. Magsaysay Award winner Nilima Mishra visited the banks head
office on and was felicitated by the bank on her achievement of
Padmashree Award, also for her substantial contribution to women's
empowerment through self help groups.
TOI
TOI
Provident fund to earn 8.5% interest in FY'13
Provident fund deposits are set to earn 8.5 per cent interest in 2012-13, slightly higher than the 8.25 per cent returns declared in the last fiscal. The decision was taken at the meeting of the Employees' Provident Fund Organisation's (EPFO) Central Board of Trustees (CBT) on Monday........
Read - IE
Read - IE
RBI, CA institute likely to discuss IFRS roadmap today
.....For banks, the CA institute had left it to their regulator, RBI, to decide on a suitable IFRS roadmap. There are indications that the Tuesday meeting will revolve around crucial issues such as accounting standards on financial instruments. The meeting could also discuss other important issues such as audit of banks, it is learnt. RBI Deputy Governor Anand Sinha will chair the meeting.......
Tax saving deposits must be made more attractive, say banks
.....If the ministry agrees to the banks request then tax savings deposits will be at par with investments in equity linked savings scheme insofar as tenure of the investment goes. Further, banks also want the ministry to allow them to grant loans against the tax savings deposits........
Rupee Bank is stable, claim employees
........While taking a dig at the RBI, it said the regulator should have considered the fate of lakhs of affected account-holders on humanitarian grounds before imposing the restrictions on Rupee Bank. According to the committee, Maharashtra Cooperative Bank Federation President and member of Task Force on Co-operative Urban Banks (TAFCUB) Vidyadhar Anaskar met the Rupee Bank Chairman on Sunday and stressed ways to ensure the RBI lifts the restrictions on the bank.............
RBI cracks down on Rupee Co-op Bank, depositors to feel the pain
The Reserve Bank of India (RBI) today directed ailing Pune-based Rupee Co-operative Bank not to allow depositors to withdraw more than Rs 1,000 from savings, current or any other deposit account. "According to the directions, depositors will be allowed to withdraw a sum not exceeding Rs 1,000 of the total balance held in every savings bank or current account or any other deposit account by whatever name called," RBI said in a statement............
Co-op chief orders report on Rupee Bank
....... "I have sought an inspection report of Rupee Bank. The report will have all the details of bank's financial situation, its deposits, debt, arrears and advances and performance of the bank in recovering loans. The RBI generally takes time to initiate action against any institution."......
Two held in fraud case
........Earlier, another director of the company, Uttam Acharjee, was also apprehended by the CID in the same case. The group has allegedly duped hundreds of people across the state. However, another kingpin of the group, Chandan Das, is yet to be arrested. Assam Police, along with RBI, have recently accelerated investigation in all the cases registered under economic offences.
RBI guidelines on inclusion fall short
..................The major concern is that the money should not go to the wrong people but to those who desperately need it. That is why it is felt that new private sector banks may not be the answer to the financial inclusion objective. Those who want to game the system have ways of doing it and are always one step ahead of the regulators. No amount of ring-fencing works.
Cash Transfers: Merits and demerits
..........The RBI's definition of financial inclusion mandates a bank to offer at least four services: savings account with an overdraft facility, business loan, remittance facility and an insurance-cum-retirement benefit product. Today, for the purpose of cash transfers, banks are offering merely a bank account. Mostly, it's a no-frill account: this does not burden an account holder with a minimum-balance requirement, but also places restrictions like a monthly cap on number of withdrawals....................
Japan's 7-Eleven eyeing Indian white label ATM space
..........Japanese financial and retail chain 7-Eleven is considering entering into the white label automated teller machine (ATM) space in India, three people aware of the development said. Seven Bank, a Japanese banking unit of 7-Eleven, has an ATM business arm..........
“Don’t privatise banks, insurance”
The UPA government should give up moves to privatise banking and insurance sectors, CPI (M) district secretary B. Narayana demanded on Sunday. Prime Minister Manmohan Singh gave directions to RBI permitting private investment and institutional finance in banks and insurance sectors, a day after the nation-wide general strike, he told a press conference here............
Sena, MNS freeze PSU bank’s hiring
Mumbai:
Under pressure from the Shiv Sena and the Maharashtra Navnirman Sena,
the Central Bank of India (CBI) has decided not to interview candidates
from outside Maharashtra for clerical posts. Several candidates from
other states in the city for the interviews have been asked to wait till
the bank gets directions from the Institute of Banking Personnel
Selection (IBPS) on how to resolve the issue......
Read - TOI
Read - TOI
RBI vs IRDA: Finmin to play peacemaker over broking licence for banks
............"The IRDA and the RBI can jointly come up with a framework where
commissions are regulated and banks also share the responsibility of
misselling," said a chief executive of a private sector insurance firm.
Bankers, too, have apprehensions about lenders doubling up as brokers.
"The concerns raised by RBI are valid. Brokers also need to take out a
professional indemnity policy," said the executive director of a
state-run bank.
Inside Man Vijayan’s the Right Fit for Irda
If
authority over the industry, professionalism and a secretive nature are
the hallmarks of a regulator, TS Vijayan is the perfect fit to head the
insurance regulator. Vijayan, the 59-year-old life-time insurer,
carries with him an enormous bank of knowledge of the industry, has
earned the admiration for laying the foundation for the Life Insurance
Corporation of India’s survival amid competition from nimbler rivals —
and loads of animosity.........
Read - ET
Read - ET
Monday, February 25, 2013
Don’t lower your guard
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