RBI to open more offices in northeast

Agartala, May 5 (IANS) The Reserve Bank of India (RBI) will set up offices in all northeastern states for better monitoring of banking services in the region, a senior official said here Thursday. Currently, RBI only has a regional office in Assam's main city Guwahati.  'After Guwahati, the first sub-office would start functioning in the Tripura capital Agartala May 18. Subsequently, sub-offices would be opened in other northeastern states in a phased manner,' a senior RBI official told reporters. RBI Governor D. Subbarao will inaugurate the sub-office in Agartala May 18. The central board meeting of the country's apex bank would also be held in Agartala next day (May 19), the RBI's first board meeting in the region.  'After the opening of RBI offices in the northeast region, the monitoring and functioning of nationalised, regional rural banks and private banks would be further improved,' Tripura Finance and Public Works Development Minister Badal Choudhury told reporters. 'We have been demanding more RBI offices in the region for the past 12 years to improve the credit deposit ratio, providing advances and financial support to the people of the region,' said the minister, who recently held a meeting with the RBI Governor in Mumbai. He complained that the credit flow to the northeastern region from nationalised banks was meagre. 'It is unfortunate that despite intervention from the union finance ministry, the credit-deposit ratio for commercial banks in the region has remained at a level of around 30 percent over the past many years. This should be raised to at least 50 percent by 2010-11,' Chowdhury said. The minister urged nationalised banks to open more branches in rural areas to curb the illegal collection of deposits by non-banking financial companies (NBFC). Quoting RBI guidelines, Choudhury said the central bank had asked all nationalised banks to open banking services, in any form, in every village in the country with a population of over 2,000.

Fake currency to the tune of Rs 87,600 seized this year

New Delhi, Mar 11 (PTI) The government today said fake currency of face value of Rs 87,600 was seized this year till March 4 by various agencies.  In 2010, fake currency of face value Rs 10.1 crore was seized by various government agencies against Rs 8.8 crore in 2009, Minister of State for Finance Namo Narain Meena said in a written reply to the Lok Sabha.  Replying to another question, Meena said, "Reserve Bank of India has reported that they had recently undertaken quick scrutiny in some banks to examine if the reasons for corruption could be attributed to systemic issue i.e. risk to the system independent of the bribery case and if absence of proper internal controls had provided opportunities for bribery."  Further, he said that acting upon the media reports that appeared in November 2010, regarding arrest of LIC Housing Finance CEO and some other persons in connection with allegation of receiving illegal gratification by senior officers of some public sector banks and financial institutions for sanctioning loans, RBI conducted scrutiny.  RBI undertook scrutiny of borrowable accounts of the groups of Punjab National Bank, Central Bank of India and Bank of India, which were stated to be under scanner of Central Bureau of Investigation, he said.  The outcome of the preliminary scrutiny did not reveal any systemic risk and lacuna in the loan sanctioning system and the relevant internal control system of serious nature requiring immediate supervisory or regulatory interventions, he said.

Banks lost Rs 2,289 crore to scamsters

The recent Rs 300- crore scam in the Gurgaon branch of Citi Bank is a pointer to a disturbing trend: the steady rise in the number of banks falling prey to such frauds. According to the data compiled by the Reserve Bank of India (RBI), the money lost to such scams has doubled in the past four years. In the current fiscal year, banks lost Rs 2,289 crore (till December), while the loss was Rs 1,057 crore in 2007- 08. It's the state-of-the-art private banks, including foreign banks, that appear to be more prone to such frauds.  The public sector banks, with their massive presence across the country, also reported an annual average of more than 3,000 cases of frauds and cheating during the past four years. Their better equipped counterparts in the private sector reported almost five times the number of cases. ICICI Bank alone accounted for almost half of the total scams reported to the RBI. Of the total 21,244 cases reported in 2007-08, a whopping 10,976 were from ICICI. Similarly, in 2008- 09, ICICI reported 13,221 of the total 23,579 cases. The bank reported 15,074 of the total 24,788 fraud cases in 2009- 10.  The second highest number of cases were reported by HSBC (3,770, 3,481, 2,741, 2028); followed by Citi Bank (1,647, 1,182, 1,277, 666); American Express banking (499, 703, 817, 637) and the distant fourth was State Bank of India (561, 745, 545, 615) during the past four financial years - 2007-08, 2008-09, 2009-10, 2010-11 respectively. The figures for the current fiscal are till December, 2010.  Maharashtra, with Mumbai being the country's financial capital, reported the maximum number of fraud cases: (1,006 in 2009- 10 and 1,045 in 2010- 11). Delhi was second with 349 cases in 2009- 10 and 338 in 2010- 11.  Union minister of state for finance Namo Narain Meena presented these figures in the Lok Sabha on Friday.  The data has thrown up interesting trends in not just scams and frauds but also the way banks were being targeted by robbers and thieves. Punjab reported the maximum number of dacoity and ATM thefts, followed by Uttar Pradesh and Haryana. State Bank of India appeared to be the favourite for thieves and burglars. SBI reported 114 such cases in 2009-10 and 79 this year, followed by State bank of Patiala - 41 and 39 respectively.

It is up to government to deal with black money issue: RBI

Reserve Bank of India (RBI) today said it had limited powers to deal with the issue of black money as confidentiality clause came in the way of handling the problem of money kept in bank lockers.  Current rules do not allow banks to find out what had been kept in their lockers, RBI Governor D Subbarao said at a press conference here. "All this is governed by a confidentiality clause about which nothing can be done at the moment," he said, answering a query on unaccounted money in the lockers of Indian banks. Answering another question, Subbarao, who was on a two -day visit to the city, said although the RBI had no role to play in the Union Budget, it stood for fiscal consolidation of the banks. Subbarao said maintaining a balance between financial growth and controlling inflation was a tough task, but the apex bank was competent enough to handle this scenario.