.................The sharp rise in NPAs is scaring banks from direct lending. No amount of recapitalization will change this scenario, unless the economic scenario improves, which is unlikely to happen soon. Government is only going through the motions of recapitalizing the banks since the guidelines have to be met.
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, July 11, 2013
Jewellery makers, exporters to get regular gold supply
SURAT: Despite Reserve Bank of India (RBI) imposing restrictions on banks for importing and supplying gold on consignment basis, the jewellery manufacturers and exporters in Gujarat will get their regular supply of gold. Metals and Mineral Trading Corporation of India (MMTC), an authorized central agency for import of gold, silver, platinum, palladium, rough diamonds and coloured stones, has decided to intervene on the issue of a regular supply of gold to exporters to boost the jewellery exports.................
Plastic money gains acceptance in rural India
...... "We aim to cover all the locations where we have branches. All our rural and semi-urban branches, barring a few that have started functioning recently, are offering credit cards to the bank's customers,"............
Bank hiring in 2014-15: No advantage for those who have cleared exams
......“Vacancies for 2014-15 are to be filled through subsequent rounds of common exams and interviews. Notification for POs/MTS-III has already been issued. The existing candidates, if qualified under PO-II or the clerical common written exams, will not be considered for recruitment for vacancies under 2014-15. They will have to write the exams again subject to eligibility,’’........
Maybank commences Mumbai operations
KUALA LUMPUR: Maybank’s overseas unit Bank Internasional Indonesia (BII) on Wednesday commenced its Mumbai branch operations in India to tap the Indian and Asen market. In a statement, Maybank said both the central banks of India and Indonesia namely Reserve Bank of India and Bank Indonesia have approved the operations of BII Mumbai..........
What Makes a Good Bank Board? Lessons from the YES Feud
............So what lessons does the YES Bank feud hold for the new aspirants? “The new players will need to ensure that the highest standards of corporate governance are established,” says Roy. “The separation of professional management from owners and rent-seekers is better envisaged than achieved. At the risk of oversimplification, I would say that the right set of motivations are required to influence people’s behavior so that they act with the best of intentions and participate in decisions objectively.”
J&K fails to get any help from PCI on recapitalization of Coop banks
......However, there was no positive response from the Planning Commission, sources said, adding “what to talk of giving any financial assistance the Planning Commission even didn’t give any assurance to help the State in clearing the liabilities”. Stating that State has been caught in a peculiar situation following denial of any relief by the Planning Commission, sources said, “now the Cooperative Department has been left with no other option but to place a proposal before the State Cabinet for sanctioning of at least Rs 100 crore in order to liquidate part of liabilities and meet the condition set by the Reserve Bank of India (RBI)”. Disclosing that RBI has set a deadline of July 15 for liquidation of Rs 100 crore liabilities by the three ailing Cooperative Banks, sources said, “if the Government meets this condition of RBI the latter will consider extension in the time-frame for obtaining license to work as banks”............
Consumer forum asks ICICI to pay Rs 28 lakh
The UT States Consumer Disputes Redressal Forum directed the ICICI Bank Ltd to refund to two residents an amount of 26 lakh along with a compensation of Rs 2 lakh for mental agony and physical harassment and cost of litigation to the tune of Rs 25,000...........
Wednesday, July 10, 2013
Looking at some of the Reserve Bank of India's goals and aspirations : Duvvuri Subbarao
LOBBYING OR REPORTING?
 |
| ................“When you are talking to your source, he/she is giving you a point of view from inside, that may or may not end up being correct. In this particular case, there are only three names that are doing the rounds. However, we chose to highlight Chaudhuri because we learnt that he has strong chances of making it as the head of the country’s central bank”. Bhattacharya doesn’t deny the fact that lobbying can happen and names can be thrown up by sources keeping in mind their personal interests. He says, “There are times when some sources plant names just to scuttle someone else’s chances. And if the reporter goes blindly to his source without any understanding of the issue he is reporting on, chances are he could be taken for a ride”........ |
Banking on a Vision
PREACH, DON’T PRACTICE
One
of the hot subjects that top officials at the Reserve Bank of India
talked about after the credit crisis was the approach to policy-making.
‘Counter-cyclical’ measures were the talk of town, at least on Mint
Street, meaning that create a buffer in good times so that you weather
the bad times. Currency traders now wonder whether it was only meant for
preaching and not practice! When the global market was awash with US
dollars, RBI imposed so many restrictions on debt-raising overseas. Now,
it is busy liberalising ECB norms. The irony is that there is hardly
anyone willing to buy Indian paper.
ET
ET
Closure of RBI Public Counters - AIRBEA letter
............It is, therefore, clear that what RBI is
doing at the ground level and what it says in public including to the
Government, who in simple belief, are informing the same to the country’s
important Parliamentarians and peoples’ representatives, are quite at variance.
Clearly, RBI have a pre-set time table to close its services and RBI offices
are being forced to implement that, no matter whether the public receive
service elsewhere as assured. We request you to please
look into the matter urgently............
RBI sets eyes on non-bank lenders
...........Some local market participants, however, see the RBI's recent interest in this alternative financial system as part of an ongoing effort to clean up the country's financial sector and prevent the growth of a less-regulated shadow banking system. That fits with recent regulatory actions against financial companies such as Sahara India. "It could be the case that the RBI has concerns about fundraising by NBFCs from the public at large under the private placement route, and the case of Sahara India as well as the chit fund cases in West Bengal are likely to have contributed to the RBI initiating these changes"............
Who Will Make It to The High St of Finance?
..........
For the successful applicants, it is also worth remembering that an
amendment to the Banking Regulation Act empowers the RBI to inspect the
accounts and business of any associate enterprise of the applicant bank
and also to supersede the board for up to 12 months. For those that have
missed the boat, the wait for the next opportunity is uncertain as the
RBI has given no indication as to when it will reopen the next window
for applications. The RBI has now made its decisions. It is now up to
successful applicants to develop business plans and identify key bankers
as they have only 18 months to implement their plans after getting
their in-principle approval.
Read - ET
Communist Party voices concern over Birla's role at RBI
.....Communist Party of India (CPI) Tuesday expressed concern over the continuation of Kumar Mangalam Birla on the board of the Reserve Bank of India (RBI), saying it was a "conflict of interest" as his group firm is in the race for a new banking licence..............
Perverse incentive structures in banks under RBI scanner
RBI has warned banks that it is taking a closer look at the ‘perverse incentive structures’ that are leading to ‘widespread mis-selling’ of third party products such as insurance to account holders..........
Arundhati Bhattacharya set to become State Bank of India MD
..............Bhattacharya will become the first woman managing director of the bank. She is seen as a strong contender to become chairperson of the bank when Pratip Chaudhuri retires in end-September. To become eligible as chairman of SBI, a candidate needs to have two years of residual service. Among the present, none meets the criterion, as three will retire by April next year and one in November 2014....................
My View on "Govt proposes to fix tenure of PSU chiefs"
Fixing tenure for PSU CEOs is a good move but certainly not good if the applicant is close to his retirement in the normal course by two years. The CEOs should have basic interest in the growth of the company optimally in a competitive environment. It is desirable to pick up CEOs in the age group of 45-50. The tenure should be such that they are given chance to understand the firm and compete and therefore should be for a period of five years. Second, selection of directors has become a farce in most PSUs and PSBs as it must have been felt that anyway their role will be minimal! If the norm of CEO selection at 45-50 is accepted it would leave enough scope to pick up the directors from an experienced pool of efficient ex-CEOs who will have scope to contribute significantly for the growth of the PSUs. This should apply even to the PSBs and the Insurance Companies in the Government fold.
- Yerram Raju
My View on "Personalization of banking: Woes of bank customers..."
The article is a true reflection of the sufferings of senior citizens. Technologies have not lessened the crowds at the counters, for several senior citizens still cannot access them and it is imprudent for the sophisticated banker to expect them to go to netbanking and resolve their problems. While it may be difficult at the present juncture for the banks to earmark either a clerk or officer dedicated to the service of senior citizens in the context of either paucity of staff or to realise their profit goal, the easiest thing is to open exclusive counter for limited hours displayed and notified by mail to all the senior citizen account holders to transact their business. Most ATMs exactly behave the way the author described. Banks seem to care little. The Banks must keep at least 500 and 100 denomination notes for all drawals of less than Rs.5000 per day until the merchandise accept debit cards for any and all transactions even for buying a cup of coffee from the restaurants as in the west.
Fixed deposits earning you negative returns
Holders of fixed deposits have been earning a negative return in real terms for most of the preceding five years, thanks to inflation outstripping interest rates. To make matters worse, depositors continue to be taxed on this nominal income. Although bank fixed deposits have never been tax friendly, the level of compliance has been sketchy. But compliance is slowly getting stricter. In the past, RBI norms required banks to take into account deposits in one branch for the purpose of tax deduction at source—a rule which allowed depositors to break up FDs across branches to avoid TDS. .........
RBI asks banks to open Aadhaar linked accounts, appoint Complaint Redressal Officer
.........The RBI has told banks that besides opening accounts they should also be seeding Aadhaar number. RBI said that it recently met with Unique Identification Authority of India (UIDAI), finance secretaries of select States, where officials emphasized that banks should proactively take steps to open a large number of bank accounts, seed these accounts with Aadhaar numbers and view it as a sustainable & scaleable business opportunity. During the meeting UIDAI also spoke about utilizing the services of LPG distributors for opening of bank accounts and seeding Aadhaar numbers in bank accounts.......
It’s Time PSU Banks Woke Up to The New Normal
...........There
is a transformation which is happening in the Indian banking scene
where state-run companies dominate three-fourths of the market. That is
the best part of the story. The disturbing factor is that barring State
Bank of India, all other state-run banks are staring at a low-cost
funding crunch that could change the banking landscape forever...........
Read - ET
Banks tighten noose: To ‘name and shame’ guarantors for loan defaulters
..........Interestingly, public sector banks are at the forefront of taking such measures and those already making public the photographs and other details of loan defaulters include the country’s biggest lender SBI and UCO Bank, Allahabad Bank, Indian Bank and Indian Overseas Bank................
Overtime at North Block
The volatile rupee and high current account deficit have resulted in a return to working weekends for some senior finance ministry officials and staff. Finance Minister P Chidambaram has started attending the office on weekends, including last Saturday and Sunday when he called a meeting to discuss the rupee......
Currency derivative clampdown: Will it really help rupee?
...........The steps that have been taken are actually in the currency Futures market, not in the larger over-the-counter (OTC) market. Traders have been saying that the RBI, by moral suasion, has made the banks compulsorily reduce their positions in OTC. However, on the currency Futures market, it has come with Sebi-imposed rules............
Use Modi to Manage Rupee
..........Any
move by any non-BJP party that is likely to destabilise the government
would immediately be damned as a move to help Modi. So scared is the
Samajwadi Party of such stigma thus that it suffers Beni Prasad Verma’s
insults in silence and dare not withdraw support for the government. The
logic works for other parties as well. This stability gives the
government space for new policy manoeuvre. It is time to be bold and
take tough decisions to revive India’s growth, strengthen macroeconomic
balance and stem the rupee’s slide.................
RBI may ask oil firms to buy dollar from single bank
...........Following the suggestion, RBI had met officials of Indian Oil Corporation, Hindustan Petroleum Corporation and Bharat Petroleum Corporation in Mumbai on Monday. “In our presentation, we had made various suggestions, including a special window for OMCs to access dollars at market rates and also buying it from a single bank. However, no written directive has come from RBI,”.........
Rupee at 60: Here’s why India is a steal for foreigners right now
.........I believe that 60 is the number where there could be a clear psychological turning point for the rupee as it is 30-35 percent lower than where the currency was in 2010-11. Despite inflation, despite policy paralysis, despite economic mismanagement, the rupee may be about to find it feet. If the rupee stabilises, the government will claim it was its efforts that did the trick. Don’t believe it. The rupee does not dance to P Chidambaram’s tunes. It is on its own trip based on more fundamental fundamentals and right now it could well believe that it has arrived. It is the dollar that should be a sell for Indians from now on..............
It’s time to pull out all the stops
.......Having crossed 61 to a dollar, the debate now is veering around the next psychological barrier — a scary 65. More than the number, it’s the rupee’s sharp and unhindered slide that is causing unease. If the country’s top economy and currency administrators have gone into a huddle in recent days, it is only symptomatic of the anxiety gripping India’s macroeconomic managers...............
Sliding Re Forces Rulebook Change
.....The
Reserve Bank of India banned banks from indulging in proprietary
trading in currency derivatives, which took the pressure off the
currency, and the Securities & Exchange Board of India raised margin
requirements for non-bank traders in a notification issued late on
Monday evening. Further, state-run oil firms have accepted RBI’s
proposal to bid for US dollars through just one bank on a given day
instead of multiple bids that magnified dollar demand and led to many
banks building up positions, said people familiar with the development........
Hard to stop the slide
RBI reviewing guidelines on mis-selling by banks in wealth management services
............The Financial Stability Report released by RBI has taken note of mis-selling in the wealth management division of banks. An issue which has been constantly been highlighted by Moneylife, needs to curbed with many checks and disclosures in place. Taking serious note of the mis-selling that occurs in wealth management and investment advisory services offered by banks, the Reserve Bank of India (RBI)'s Financial Stability Report released on 27 June 2013 says that it is in the process of reviewing its guidelines...........
Commerce Ministry seeks liberalised packing credit scheme from RBI
...“We would ... request that RBI’s special export credit refinance to support PCFC (packing credit in foreign currency) (and it) may be enhanced from 50 per cent to 100 per cent,” Commerce Secretary S R Rao said in a letter to RBI Governor D Subbarao...........
What will you do if taxman knocks at your door?
Any communication from I-T department and especially receiving a notice can send shivers down your spine, even though it might be a routine enquiry or a simple clarification sought. Notice can be issued for varied reasons and there is no standard single solution to deal with different notices in the same way, but you can surely follow these 12 golden steps as mentioned below in response to any kind of notice you may receive: Neither panic nor ignore: .............
Pension account after death of a pensioner – RBI Instructions
.....In this connection, we advise that in case the spouse (Family pensioner) opts for existing joint account for credit of family pension, banks should not insist on opening of a new account when the spouse is the survivor and having a joint account with the pensioner and in whose favour an authorization of payment of family pension exists in the Pension Payment Order (PPO)..........
Deem grant of education loans as service to society, banks told
.........Noting that banks acted as a bridge between students and their ambitions for better education, the District Collector said banks should do their best to resolve quickly complaints regarding the disbursal of education loans. She said that special consideration should be given to make the process of granting education loans easy. “Disbursal of scholarships, welfare pensions, and other benefits through bank accounts should be accelerated,” Ms. Latha said. “The banks should create awareness among the public to not depend on private financiers for financial aid,” V. Raveendran, Assistant General Manager, Reserve Bank of India, said in his address............
Fair & Lovely Mutual Funds
......What about consumers? Why don’t they protest? Well, because these nicely perfumed gels and lotions may not make you fairer, but they are harmless; they moisturise and they allow people to live in hope. In other words, the consumer is a willing sucker in this case and there is little harm done. Can mutual funds (MFs) try to sell their schemes like fair & lovely? MFs have an obligation to perform. If an MF scheme, over a period of time, gives you low or negative returns, it hurts your financial future. It is not harmless......
Sebi to ask Subrata Roy led Sahara about unverified investors
.....However, a pilot verification project undertaken by Sebi found that a vast majority of these investors were not traceable, the market regulator said in a status report presented before its board late last month. "These cases will be referred to Saharas in due course, for their explanation/clarification," Sebi informed its board.................
Fanbox mail scam: Watch out for automatic debit from your bank, PayPal account
.............In future, if you get any spam or suspicious looking email claiming you have won something or have something unclaimed, it is best advised to filter and delete it right away. Moreover, never link your bank account or credit/debit card online to any third party, even if the site is credible. As for Fanbox, it is best you stay away from it, no matter what their claims are.
Microfinance Institutions Get a Boost From Development Funds
We
are here to write big cheques. We do not write small sums,” said Rajat
Sood, vice-president, General Atlantic, a PE fund, in a message to the
microfinance industry that’s attempting to limp back to life after the
SKS Microfinance fiasco nearly killed the fledgling industry. Sood was
speaking at a seminar arranged by industry body Microfinance
Institutions Network (MFIN). Investors are showing some interest these
days after fleeing the sector en masse...........
Read - ET
Read - ET
TMB banks on public float for growth
......The bank's conservative holding, while ensuring that its financials remained robust, has come in the way of its expansion plans. It was denied permission by the Reserve Bank of India to open branches in the metro cities because of its legal trouble and lack of public equity. As a result, TMB has in recent years lost out to competition. .....
Tuesday, July 9, 2013
Lobbying for the next RBI Governor
My View on "Arvind Mayaram, Raghuram Rajan in fray for RBI Gov..."
The choice between Raghuram Rajan and Arvind Mayaram is crystal clear.Apart for one thing in common, the word Ram(Random Access Memory or our Maryada Purush Ram), there is nothing common between the two. Rajan is privy to Global EcoSystem, has worldview like Ben Bernanke and full of innovative ideas. Arvind Mayaram is conservative (cannot be otherwise being an official from a hidebound bureaucracy which excels in precedences and looks to politicians of the day for guidance),familiar with Sikar, Barmer, Jhunjhunu, Jaipur etc; walks on dotted lines,risk averse and not known to chase predetermined fiscal targets in a time bound manner. The selection should be thrown open to a wide spectrum of players and not confined to a narrow pool of IAS.His main qualification is being touted as being from IAS, he will coordinate better with Ministries of Commerce,Foreign Trade and other organs of Government, manned solely by IAS. Is Ben Bernanke,who has move from fiscal stimulus to quantitative easing, a product of bureaucracy? No. He was a tenured Professor at Princeton University who applied latest economic tools to revive $15000 US economy.Why we cling to traditional monetary tools coupled with political nature subsidies to revive $1800 economy and still have the gall to say we are third biggest economy in the world.
Why our DGs are being trashed that they have no administrative skills e.g.Sinha, H.R.Khan,
- Sitendra Kumar
Applications invited for the post of Chairman, NABARD
Government appoints top PSU bank executives
The government on Monday made three top appointments for public sector financial firms. S K Jain has been appointed chairman and managing director (CMD) of Syndicate Bank, Rajiv Rishi as CMD of Central Bank of India and S B Mainak has been appointed as MD of Life Insurance Corporation of India (LIC)..........
Govt proposes to fix tenure of PSU chiefs
.......“In the absence of succession planning, highly competent officers in CPSEs (central public sector enterprises) are many times not left with two years or more of service when posts of functional directors/CMDs fall vacant. As a consequence, CPSEs lose the benefit of getting this pool of talent to occupy the deserving board level posts. Quite often, these competent executives lose their motivation while serving for rest of their tenures,”.............
ICICI Bank trains women staff in self-defence, ensures safe travel
MUMBAI, JULY 7: Security for working women remains a concern in most cities across the country. Taking serious note of this, the country’s largest private sector lender, ICICI Bank, has initiated additional assistance and support to its women employees after working hours. Last month, ICICI Bank implemented some measures for women by setting up a team to conduct self-defence training, monitoring their travel after working late and organising quick-reaction mobile vans to handle emergency situations. Women constitute about 25-30 per cent of the bank’s workforce. At present, ICICI Bank has 17,000 women employees, including probationary officers.........
My View on "Birla should quit RBI board for sake of legacy"
It is Mr Kumara Mangalam Birla who chaired the SEBI Committee on Corporate Governance. To uphold the good principles of good governance, he should have quit the RBI Board on the day he applied on behalf of his company for a license to open the Bank to the RBI. Even if the license were not to be granted, it would be wise to honorably quit the Board of RBI. The RBI on its part would do well not to send any Board papers to him just because he is still ornamenting the Board list.
- Yerram Raju
Women entrepreneurs may see a future with this bank
 |
............While male employees would also be hired for running the bank, but to make it empathetic to the needs and aspirations of its target customer base, it is expected to be headed by a woman. However, who will head the bank is still a unclear. Officials said that though a number of candidates — all of whom are women — have been identified, a final decision is yet to be taken and can be expected only after clearance from the Union Cabinet for the bank. However, don’t expect the bank to offer any concession rates to women customers. Finance ministry officials have said that it will function purely as a commercial bank and follow the RBI’s guidelines. Apart from regular banking facilities, it is also likely to tie up with state-owned financial institutions and offer pension and insurance products...........
|
Unions oppose entry of new banks
..............“UFBU is of the opinion that public sector banks should be further strengthened and expanded to play their pioneering role to meet the present day challenges to our economy” statement added. “In the entire world, the mix up of business and banking had been an unsuccessful model” UFBU said in its resolution. “We are concerned that the Reserve Bank of India and the government are trying to hurry up the process of opening up the banking sector to all types of private interests including foreign direct investors” UFBU said. India today needs strengthening of the public sector banking with further social orientation, rather than encouraging the profit oriented private sector banking according to UFBU. It also called on the government revisit the policy of banking sector liberalisation...............
Bank on hope
The Reserve Bank of India is the mother of oligopolies. It loves government banks, knows that they are not much good at serving their customers, and has done its best to protect them from competition. But it is almost 10 years since it gave out the last bank licences. The common man may complain about lack of banks, but he hardly matters. But then, the prime minister, who once was governor of the RBI, ordained that the numerous subsidies that his government gives its chosen common man be paid in his bank account; it was then discovered that most common men had no bank branch within even driving distance. His government’s banks had counter clerks with children in good city schools; they did not want to go and serve the common man in fly-ridden villages.............
Personalization of banking: Woes of bank customers
Though the banks claim to be taking particular care of senior citizens, the ground reality conditions are far different
.........The other perennial problem faced by senior citizens is the lack of uniformity in the tedious issue of Tax Deductions at Source/TDS on the interest credits. The branches ought to hand over the “No tax deduction request” forms religiously in March each year to make them effective from the following accounting year essentially for monthly credits from April onwards. The declarations should be collected and earmarked. The gross interest earned has to be first credited and the tax deducted debited at the same time..........
LawMin to decide whether Aadhaar's e-KYC is valid
.....Several months after it was launched with much fanfare, the ambitious plan of the Unique Identification Authority of India, or UIDAI, to substitute physical verification with electronic know your customer (KYC) authentication as a means to provide government services, including opening bank accounts, is yet to take off. Reason: There are still doubts on the current legal sanctity of the proposal..............
Read | Business Standard
Account statement must be provided for free
The banking regulator has repeatedly instructed banks not to force periodic ‘statement of accounts’ on savings bank customers who prefer the passbook facility. Yet, some banks are neither listening to their customers nor the regulator. If you see the latest Master Circular on Customer Service, issued by the Reserve Bank of India (RBI) last week, there is a clear instruction to banks to offer pass book facility to all its savings bank account holders (individuals). “A passbook is a ready reckoner of transactions and is handy and compact and as such, is far more convenient to the small customer than a statement of account,” the RBI says........
Banking to be easy at home, away
...........According to RBI officials, the earlier regulatory prescription that 'charges should be reasonable' had not achieved its purpose and proper pricing of these basic banking services, especially for lower category of customers, had not been addressed. With the introduction of CBS, it was expected that customers of banks would be treated uniformly at any sales or service delivery point. "Some banks were discriminating against their own customers on the basis of one branch being designated as the 'home' or 'base' branch where charges are not levied for products/ services and other branches of the same bank being referred to as 'non-home' branches where charges are levied for the same products/ services," the RBI said........
Credit Information Companies: Seeking New Frontiers
........RBI has been rather proactive in adopting some of the global best practices of positive data sharing right from the inception. Even mature bureau markets like Brazil and Australia have started witnessing a move towards a limited positive data sharing environment only as late as 2013. Several other jurisdictions have also started evaluating the possibility of increasing the scope of credit reporting...........
Global Regulator may Simplify Bank Rules
The
world’s main bank regulator may simplify a mass of new rules coming in
for the industry, a sign that watchdogs are still grappling with how
best to keep banks in check nearly five years on from the financial
crisis. The regulator, the Basel Committee on Banking Supervision, on
Monday published suggestions on how to simplify its new regulations
after an internal review of whether the rules, designed to safeguard the
world’s financial system, had become too complex............
Read - ET
Read - ET
Financial inclusion: Rural credit architecture needs an overhaul - M.G.Warrier
........Rise in rural deposits and urban credit created imbalances and certain bypass routes were allowed for banks to achieve their priority lending targets. Like Mutual Funds (MFs) investing in schemes of other MFs to pair risks, banks started searching for other intermediaries like microfinance institutions (MFIs) for providing credit to small borrowers. MFIs, in some cases borrow from banks at low rates and lend at up to three times the borrowing rates, in the same area where bank branches function. So as long as banks source rural deposits, they should also shoulder the responsibility of providing credit in rural areas at reasonable interest rates. The situation calls for a review of the entire rural credit architecture for an overhaul.
Present economic Situation and IMF loan - Dr.T.V.Gopalakrishnan
.......The Financial System has to be given a facelift and the initiative has to come from SEBI to attract NRIs to Indian market in a large scale.Better to avoid foreign debt particularly IMF loan as it may have its own baggage to be taken care of and that also will affect the masses. Any measures without taxing the ordinary masses are welcome.
Ganesha coins minted in Germany, issued from Africa!
India’s RBI Said to Discuss Dollar Purchases With Biggest Buyers
..........The central bank and the refiners are exploring the possibility of mandating a single state-run bank to sell dollars to the companies, eliminating bids that fuel speculation in the rupee, the person said, asking not to be identified because the matter is confidential. Another option is for the RBI to sell dollars directly to the oil companies, the person said..........
The fall spells more trouble
..........The RBI, which has warned of upward risks to inflation on account of the rupee weakness, has kept on hold its indicative policy rate in the last June 17 policy meet. “We are afraid it may be forced to hold on to its rates even in the coming policy also if things do not improve on the rupee front. This, in turn, will further dampen investor sentiment and hurt stock markets,’’ the report added..........
Managing the rupee fall
...........In other words, the government should let the rupee depreciate. A falling rupee is not a hit to national pride - it is merely a basic economic consequence of India's struggle to pay properly for its gold and fuel imports, and the invisible hand's way of counteracting that demand. It is precisely because the rupee is falling that the danger of a serious balance-of-payments crisis is not even more acute than it already is. The trouble is that some companies that have considerable external exposure will find themselves unable to cover their dollar debt. Again, given the nature of India's political economy, there will be pressure on the government to somehow bail those companies out..............
The rupee's wake-up call
...........To dampen the additional inflationary pressures implied by a weaker rupee, more aggressive fiscal retrenchment is needed. Even so, a depreciated rupee will increase the burden of repaying foreign debt, and deepen the woes of domestic companies and banks.
To reclaim its promise, India must foster a new generation of productivity growth. The time for action is now. Unfortunately, a serious crisis may be required to initiate that response.
The weight of a sinking rupee
.....With the rupee having lost 9.27% so far this year and little sign of the trend reversing amid overall economic gloom, we look at how India is doing on various indicators and what’s likely to happen............
Boost Economy, Rupee will Revive
........Once
markets are thus encouraged to respond to fundamentals rather than to
foreigner whim, the positives of US recovery for India will filter
through. If the government stops merely monitoring project
implementation and starts sacking non-performers instead, public
investment would revive as well...........
Read - ET
RBI is likely to pause in July review of monetary policy: K Harihar, FirstRand Bank Ltd
............ In fact, the former Deputy Governor of the Reserve Bank of India, S S Tarapore, who is very well respected, he in fact urged that the rupee's real value, fair value should be something quite alarming at 70 to the dollar and while we might not go up to 70, is there a case for allowing the rupee to weaken further if only to restore competitiveness?...........
Hedging surge prompts central bank inquiry on rupee moves
The Reserve Bank of India (RBI), concerned about the fastest growth in currency derivatives trading in a little over three years, is asking foreign funds to prove they were not speculating on the rupee. Futures and options trading involving the currency rose 47 per cent to a daily average of Rs 38,770 crore ($6.4 billion) in June on the National Stock Exchange of India, the biggest jump since January 2010............
Read | Business Standard
Bank loan recasts top Rs. 2.5 trillion
.......Large-scale restructuring of loans given to firms began in the aftermath of the 2008 global financial crisis. A liquidity crunch that followed the crisis and the slowdown in global markets affected companies in India too, forcing banks to recast loans across sectors such as textiles, real estate, power, and gems and jewellery. About 10-15% of the loans restructured then are believed to have turned bad. This time the proportion could be higher, said analysts, because RBI has been slow to exit from its tight monetary stance. In 2008-09............
SBI may raise home loan ticket size with likely spread cut
India's largest lender the State Bank of India (SBI) may launch a new home loan product that is expected to facilitate millions of home loan borrowers to avail higher credit limit at a lower interest rate. It is learnt to have already submitted the product proposal and it is awaiting for the final nod from an internal policy making body - CCPPC (Credit Pricing and Processing Committee)...........
SBI launches State Bank Xpress Money prepaid card with UAE Exchange
State Bank of India (SBI) today launched State Bank Xpress Money Card a co-branded prepaid card that can be loaded up to Rs 50,000 with UAE Exchange and Financial Services, for loading inward remittances received under money transfer service scheme (MTSS) of Reserve Bank of India (RBI), on VISA network............
SEBI finally replies to former secretary Sarma on MLM menace
........While the RBI has maintained that the deposit-taking companies does not fall under its jurisdiction, market regulator SEBI tried to rein in such companies in the past under its CIS regulations. However, these companies managed to subvert the SEBI orders and continued to flourish with political patronage. In its reply to Mr Sarma, the market regulator said, “MLM schemes in the nature of money circulation schemes are banned under the central legislation titled Prize Chits and Money Circulation Schemes (Banning) Act 1978 (PCMCS Act) and as such these do not fall within the purview of SEBI”............
Three YES Bank directors not 'fit and proper', says Madhu Kapur family
..............In rejoinders and draft amendments to their petition filed with the Bombay High Court today, the Kapur family has said "defendant numbers 7 (Nanda) and 9 (Srinivasan) do not meet the fit and proper requirement of age criteria of 35 to 65 years, as prescribed by the RBI circulars being relied upon...Both defendant numbers 7 and 9 as per the AGM (annual general meeting) notice are 69 years old."............
Monday, July 8, 2013
In Diplomacy at Home, Govt Set to Repair Ties with RBI
RBI top post: Saumitra Chaudhuri frontrunner
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Planning Commission member Saumitra Chaudhuri has emerged as the frontrunner for the post of next Reserve Bank of India governor. The government plans to issue the orders once the appointment committee of the Cabinet formally approves Chaudhuri's name. The term of present Governor D Subbarao ends on September 5. Prime Minister Manmohan Singh is learnt to be in favour of Chaudhuri as India's monetary policy regulator, to work in tandem with the government at a time when the economy is facing a downturn.........
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