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.
Saturday, September 14, 2013
RBI asks some foreign bks to restrict activity in NDF mkt
.....The RBI is attempting to curb speculation on rupee in the offshore non- deliverable forward market, Cogencis had reported on Jul 25 citing a finance ministry official. Many a times, corporate hedging was used as a front by certain entities to undertake speculative positions of their own. In a bid to counter such speculation, the RBI on Jun 26 issued a notification saying that foreign institutional investors, who intend to hedge the exposure of one of their sub- account holders, would have to produce a clear mandate from the sub- account holder in respect of the latter's intention to enter into the derivative transaction......
Another currency crisis waiting to happen: Mahesh Natani
...........“This led to the further depreciation of the rupee to Rs. 68.85 on August 28, 2013. The manner in which the rupee depreciated by over 11% in a short span of 12 days (from 16.08.2013 to 28.08.2013) shows that a major component of buyer’s credit has not been hedged by importers,” alleges Mr. Natani. In response to queries raised by Mr. Natani under the RTI Act, the RBI has admitted that it does not possess key details on buyer’s credit being availed by importers like the amount and date of maturity. When asked, the RBI did not respond to a detailed set of questions emailed by The Hindu on September 3, 2013............
Banking sector revives Lehman fears
............"If you have to save banks from failing, you need more capital. The government has to act swiftly in recapitalising public sector banks. Otherwise, there is a significant risk of some of the banks' net worth being impaired," ............
Investors tread cautiously in state high on RBI report card
........Government authorities described the RBI analysis as a proof of the Naveen Patnaik government's industry-friendly policy. "Our government has pursued an industry friendly policy. Investors are coming in diverse areas such as power, steel, cement, ports and so on despite perceived global slowdown. Odisha is slowly but steadily emerging as an industrialized state," said steel and mines minister Rajnikant Singh. ...............
India Infoline to demerge broking business
.............“We have applied for approval in the high court and then we can proceed on this,” said Mukesh Kumar Singh, executive director, IIFL. India Infoline Distribution is an unlisted subsidiary, in distribution of financial products. IIIFL has applied for one of the new bank licences to be given. The Reserve Bank of India had said it would.............
India’s Exim Bank Sees Potential in Burma
.........Exim Bank has been providing alternative financing solutions to the Indian industry, especially the exporting fraternity, supporting them in their efforts to be internationally competitive. Over the past three decades, a greater measure of internationalization of Indian business has been occurring, through Indian corporates establishing joint ventures and wholly owned subsidiaries, as well as acquiring companies abroad. Exim Bank was the first financial institution approved by the Reserve Bank of India, India’s central bank, to provide overseas acquisition finance..................
Delayed protest
My View on "Rythu Sangham opposes Bakshi panel recommendations...":
 |
| - Yerram Raju |
Two of the Members officially raised their dissent at the truncated view of the recommendations for the NABARD choice to implement: this author and Prof H.S. Shylendra. The Committee that met twice - once at the time of discussion of TOR and second time, when NABARD presented the Draft telling the members present that the RBI was not prepared to extend the date for submission of the Final Report. The Draft presented did not contain the recommendation highlighted by NABARD for its implementation vide its circular dated July 22, 2013. This website carried my article - the Gay Abandon on this issue reinforcing the delayed protest of Rythusangham.
Why mobile banking is more on paper and less on mobile
.......The usage is clearly increasing. Until 2013 August, as many as 846,000 transactions have taken place using IMPS, sharply higher than 93,715 as of September 2012, NPCI data shows. “The numbers are improving , but there is still a long way to go,” A.P. Hota, managing director and CEO, NPCI, told Firstpost. India has 55.48 crore mobile users as per this news report. Of this, only 2.3 crore (RBI data) or just 4.41 percent do any kind of mobile banking activities..............
RBI cancels license of Srikakulam Co-operative Urban Bank
......"In view of the fact that Srikakulam Co-operative Urban Bank Ltd, Srikakulam (Andhra Pradesh) had ceased to be solvent, all efforts to revive it had failed and the depositors were being inconvenienced by continued uncertainty, the Reserve Bank of India delivered the order, canceling its licence," the central bank said in a statement Friday..............
Send e-return copies to Bangalore centre: IT dept to taxpayers
Income Tax department has asked electronic filing taxpayers not having sent their returns copy for the two previous assessment years by post to its centre in Bangalore, to do so early. It also said that those tax payers who have already posted the corresponding ITR-V to its centre and have not received an acknowledgement for the same for these periods, should post it again.............
Friday, September 13, 2013
Uncertain times, certain opportunity
......RBI further informed that as per an earlier circular, interest rates offered by banks on non-resident external or NRE deposits could not be higher than those offered by them on comparable domestic rupee deposits. But in order to provide the benefit of exemption provided on incremental NRE deposits with a maturity of three years and above from CRR/SLR requirements, banks have been given the freedom to offer interest rates on such deposits without any ceiling. However, the prevailing ceiling on non-resident ordinary or NRO accounts will continue as it is. These instructions will be valid up to 30 November 2013, subject to review..........
Letter to new Governor by Retirees' Association
...........We
have reiterated that Regulation 5 empowers the Central Board to revise the
pension on the lines of the improvements in Govt. Pension Scheme. Unfortunately
for us, our fears in the matter have come true and even after nearly two years,
Ministry is seeking 'further clarifications and further data”, although HRMD
had many discussions with them and have provided every available information. We
shall be grateful if you will kindly keep in sight the above mentioned facts,
while considering the issue of updation of pension..........
Finance ministry, RBI work out informal arrangement to avoid open clashes on policy issues
........While the recent arrangement does not particularly break new ground — setting interest rates and bank regulation are already under RBI — the government official involved in the process said there was a need to fix the relationship as it had turned "really bad" in the last year of Subbarao's tenure. "Short-term interest rates and monetary policy management have to be strictly within RBI's domain, but financial inclusion agenda is clearly part of the government's political mandate," the official said. This newfound coordination was reflected in the package of measures announced by Rajan at his press briefing. .........
Hyderabad to remain financial capital
Even if bifurcation of Andhra Pradesh is the reality, Hyderabad will continue to be the financial capital of the bifurcated States. The newly created regions will be brought under the jurisdiction of the Reserve Bank of India (RBI), Hyderabad, a regulatory model that is in place in north-east and other States according to a highly placed source at the RBI. While Hyderabad is expected to be the financial capital having monetary and regulatory control, the new regional offices will take up developmental and other activities of awareness post division, according to him........
Financial joke
The Securities and Exchange Board of India (Sebi) recently notified an National Institute of Securities Markets (NISM) exam for merchant bankers. It is one the best financial jokes. Those who are already in the profession before the notified date get two years to pass the exam, while someone appointed tomorrow, with no experience, gets only one year! And both will be answering questions from the same question bank.........
The FII effect - Dr.T. V. Gopalakrishnan
......The fact that FIIs are able to dictate terms to the capital and forex markets since the days of liberalisation, despite the presence of insurance institutions, mutual funds, provident funds, banks and a whole lot of whole-sale and retail traders only reflects the weakness of our markets and these investors. It is time our investors and the authorities frame a strategy to counter FIIs to ensure that some semblance of order prevails in the market. The buy and sell policy of domestic institutions has to necessarily counter that of FIIs...
RBI sets up committee to revise monetary policy framework
...Chaired by Deputy Governor Urjit Patel, the committee will review the objectives and conduct of monetary policy in a globalised and highly inter-connected environment and recommend an appropriate nominal anchor for the conduct of the policy. It is expected to submit its report within three months, the RBI said.......
A temporary spurt?
......Only a part of the reason for the revival of the currency might be the change of guard at the central bank. Raghuram Rajan’s appointment as RBI chief had been greeted by both the currency and share markets. He had, of course, taken some baby steps to restore faith in the currency, withdrawing a few panicky decisions his predecessor, D Subbarao, had taken in his last days at the bank. et, the euphoria over Rajan’s appointment cannot last long. Markets are heartless even at the best of times. There must be some good reasons for the reversal of the slide. One immediate cause could be the growing realisation that the US Federal Bank may not after all undertake the threatened tapering of the stimulus, at least not immediately..........
Finance Ministry seeks RBI view on listing of unlisted companies abroad
...........Seeking the opinion of the RBI governor, a senior finance ministry official has said in the note that the issue of allowing unlisted Indian companies to get listed abroad without a prior or simultaneous domestic listing has been under consideration for a long time and "was recently discussed with RBI and Sebi in a meeting chaired by secretary, economic affairs, on June 27, 2013." ..........
The wrong fears
.......Indeed, it was none other than Dr D Subbarao who said at his I G Patel memorial lecture at the London School of Economics earlier this year that the classical interest-rate defence of a currency might not work in India due to this peculiarity. The outflows of money and consequent 13 per cent depreciation in the rupee that we have seen since July 15 have more to do with expectations of a solvency crisis in the financial sector, rather than interest rate differentials........
Growth, deficit problems not structural: RBI chief Rajan
..In commentary published on the Project Syndicate website, he also drew an analogy between the current bearishness on the country, whose currency has barely recovered from record lows last month, to the fickle loyalties of Indian cricket fans. "A few years ago, India could do no wrong.... Today, India can do no right," Rajan wrote in the piece. Referring to the record current account deficit and slowing growth, Rajan said those "can all be fixed by means of modest reforms."............
RBI keeps subdued outlook for corporate investments
.......The apex bank said that demand conditions continue to be a major factor in driving investment intentions. With a baseline projection of real GDP growth at 5.5% in 2013-14, demand conditions may not improve substantially. While the government has initiated some steps in the recent past to improve the investment climate, results are yet to be visible,” said the RBI.............
SBI - Change in Directorate
..... the Central Government, in consultation with Reserve Bank of India, vide Gazette Notification dated August 29, 2013, nominated Shri Tribhuwan Nath Chaturvedi, as part-time Non-official Director .......
Mani writes to RBI Governor
........In a letter sent to the RBI governor on Thursday, Mr. Mani said the escalation of prices of all essential commodities being experienced in the country now was due to supply side factors and increasing cost of production. The remedy, it seemed, should come from initiatives to encourage the productive sectors.......
RBI to create central repository on large credits
.....Accordingly, it has been decided to use the information supplied by the banks through the return on large borrowers (Form A)...which captures system-wide exposure of individuals and entities having exposure (both fund and non-fund based) of more than Rs.10 crore, for creation of central repository of large credits across banks,” it said...........
Rythu Sangham opposes Bakshi panel recommendations
......He also feared that the recommendations will again force small and medium farmers to approach private money lenders for investment on their crops and urged the State government to convene an all-party meeting including all farmers’ organisations to discuss the issue. He warned the Centre that the APRS would organise protests across the State opposing the RBI's move to implement the Bakshi Committee’s recommendations, if the government fails to withdraw the decision.
Self-regulatory organisations to enforce discipline in MFIs
....“We have had a detailed discussion with SIDBI, Nabard and the Government. We will be recognising industry bodies or entities which will function as SROs,” said Archana Mangalagiri, General Manager, Department of Non-Banking Supervision, RBI. An SRO is a voluntary body appointed by the industry participants to monitor the functioning of all players in the industry and bring in some degree of standardisation in industry practices. Mangalagiri added that the RBI is clear there cannot be multiple regulations for NBFC-MFIs....
ICICI plans to issue 500,000 new credit cards in 2013-14
.... “We are seeing spending growth of 20% or more, varying between Rs.1,300 crore toRs.1,500 crore every month. Our delinquencies are less than half of the industry and 90% of our cards are actively used,” Sabharwal said, adding that ICICI’s delinquencies had fallen “dramatically” over the past few years. Sabharwal declined to give a specific number on the delinquencies citing compliance issues.....
RBI report an eye-opener for Congress: Parkash Singh Badal
CHANDIGARH: Punjab Chief Minister Parkash Singh Badal today said the Reserve Bank of India (RBI) report which has put Punjab among three best investment destinations in India during 2012-13, should be an eye-opener for Congress. ...........
Thursday, September 12, 2013
The curious case of central bank independence
.......N. Nergiz Dincer and Barry Eichengreen have updated their ranking of global central banks in terms of transparency and independence. Their data shows that the Reserve Bank of India (RBI) is the least independent of the 89 central banks the two economists have studied. They say that the Indian central bank suffers because of the way governors are appointed, the lack of independence in policy formulation and the lack of an independent objective.............
RBI to get glimpses of Rajan's technical accumen, not earthshaking changes - Rajiv Takru
.....With Raghuram Rajan taking charge as the new RBI Governor, do you think differences between the North Block and Mint Road will come down?
When there are two thinking people they are bound to have different opinions. When two people think about the same thing they very frequently come out with interpretations and solutions which differ. I don’t think we should blow it out of proportion and call it differences. ...........
Why has the rupee recovered? - Renu Kohli
Over the past few days, the rupee has recovered some of the ground it lost to the dollar. Some ascribe this to a retreat from panic overshooting. Others believe it is optimism inspired by a new Reserve Bank of India (RBI) governor. Still others proffer explanations based on economic fundamentals.....
Don't shower bank notes on personalities, says RBI
......."Such actions deface the bank notes and shorten their life," the Reserve Bank stated and added that bank notes should be respected as they are a symbol of the Sovereign and public should not misuse them and help in increasing the life of bank notes. The Reserve Bank has also stated that it has been taking all measures to supply clean bank notes across the country and has urged the members of public to contribute their mite to its efforts in pursuing a ‘clean note policy’ for the country.................
Lack of support hits anti-terror drive
,,,,,,,,,Many banks have refused to share details of suspected bank accounts in which huge money was being sent from abroad with the police. The banks have asked the cops to contact Reserve Bank of India for assistance. DIG, range, A Satish Ganesh on Wednesday said "correspondence made with RBI in this regard has so far failed to yield any result."..........
ATMs, card terminals to scan UID biometrics
MUMBAI: All new credit card swipe machines and automated teller machines (ATMs) will be required to have a mechanism for Aadhaar authentication using biometrics. The Reserve Bank of India (RBI) is understood to be preparing such a directive to improve security and promote financial inclusion. The central bank had been debating between the international 'chip and PIN' and Aadhaar-based authentication to provide additional security for card transactions. Although RBI appears to have reconciled to a combination of 'chip and PIN' authentication for existing customers and biometric checks for hitherto unbanked cardholders, the challenge is in the acceptance devices........
Well written book review
Dear Mr. Ramachandran,
Thank you very much for sending me a copy of your Review of 4th Volume of the RBI History (published in the Free Press Journal on August 23, 2013 ). It has come out very well and I appreciate your taking the trouble of sending its copy to me.
With regards,
Bimal Jalan
RBI clarifies foreign banks can open zero balance account
The Reserve Bank of India (RBI) today clarified that foreign banks having branches in India can open zero balance account. The regulator has released a list of frequently asked questions, in which it has said that the Basic Savings Bank Deposit Account (BSBDA) guidelines are applicable to "all scheduled commercial banks in India, including foreign banks having branches in India"...........
A housing slump in India
................Bimal Jalan, a former chief economic adviser to the Indian government who was also the governor of the central bank from 2000 to 2004, said in a telephone interview from New Delhi that the broader Indian economy could escape serious harm even if real estate prices did decline. India has low rates of homeownership, so families are less likely to be worried about falling home prices and cut household spending............
Read..............
Read..............
Economy will stay in L-shaped trajectory, making RBI governor task more challenging: CRISIL
......Crisil believes that the Indian economy will stay in L-shaped trajectory through this financial year, unlike the V-shaped recovery seen after the Lehman crisis in 2008. Ms Kudwa said, "we are right now at the tail of L-shaped trajectory, which will take some more time to get over." Despite all written and said about new RBI governor and expectations from him, CRISIL made it clear that rising inflation become the biggest hurdle and challenge for RBI governor Raghuram Rajan. "due to rising inflation, it would be difficult for RBI to cut interest rates way forward," Kudva said............
Videocon's flip-flop costs it a chance for banking foray
.....After sending its intention to apply for a bank licence, Videocon group subsidiary Value Industries sent a letter to the Reserve Bank of India (RBI) expressing its desire to withdraw the application. “However, thereafter the group sent a letter again withdrawing the withdrawal letter. The RBI considered all the three letters and announced that Videocon is withdrawing from the fray,”........
Basudev Acharya also against Nabard Circular
.....The Communist Parliamentarian and Chairman of committee on agriculture in Lok Sabha Mr Acharya has called for immediate withdrawal of the circular. According to Acharya, the circular undermines the independence of PACS, weakens the institutional agri-credit system, threatens the federal structure of the country and smacks of arbitrariness and blatant refusal to consult with the stakeholders...........
India considers investing $4.3 b in World Bank bonds
............The Cabinet will tomorrow take up the proposal to allow the Reserve Bank of India to invest in bonds floated by the International Bank for Reconstruction and Development (IBRD), a lending arm of the World Bank. “The RBI will subscribe to the bonds of the IBRD...This is an investment proposal, which means they will get a return on it. So it is not equity or a grant,” a top finance ministry official told reporters here..............
Rupee turns tide under Rajan, becomes Asia's best performer
Before and after he took over as the 23rd governor of the Reserve Bank of India, Raghuram Rajan has been tirelessly saying that he doesn’t have a magic wand. But the market seems to be banking precisely on the opposite. The Rajan magic is indeed working, and how. Till a week back, the rupee had lost about 20% against the dollar in the financial year and for many, there was no end in sight as the currency touched record lows almost every other day.............
Offer investment tax credit to ease economic situation: IIM-A study
While the new Reserve Bank of India (RBI) governor Raghuram Rajan effect on rupee is visibly increasing, an IIM Ahmedabad (IIM-A) working paper suggests there is more to be done, especially in terms of increasing liquidity in the market, and improving the regime for private investment...
FIPB to consider Axis Bank, HCL Tech proposals next week
The proposals of Axis Bank and HCL Technologies to raise foreign shareholding limit will be taken up for consideration by the Foreign Investment Promotion Board (FIPB) next week. Axis Bank had approached the FIPB last month soon after the Reserve Bank of India (RBI) said the limit of investments through Global Depository Receipts (GDRs), American Depository Receipts (ADRs), FDI, NRI, FIIs in the bank had breached the overall limit of 49 per cent of its paid-up capital..............
Wednesday, September 11, 2013
RBI’s unanswered questions - A.Seshan
MASSIVE DHARNA BY ALL INDIA BANK PENSIONERS AND RETIREES CONFEDERAION (AIBPARC)
.....The issue of Pension Updation and Family Pension is also a very live issue concerning the RETIREES and more particularly the FUTURE RETIREES and hence AIBPARC is soliciting the support of all serving Employees and Officers organisations..........
Senior citizens seek better treatment at banks
Most banks in the country want to catch their customers young — a desirable objective, given India’s young demographic profile. But in the process of welcoming the young, banks are overlooking the needs of older customers. According to SBI’s annual report of last fiscal (2012-13), of its 286 lakh savings bank accounts, 34.7 lakh were pension accounts.Some bankers, especially at the senior level, are considerate and treat the aged with respect. But they are a vanishing tribe who would be retiring soon..........
Obituary
Dr. P. Laxminarayanan, from Nagpur Office,
passed away on Friday the 6th September, 2013. He was seriously ill and
was admitted in hospital, but was discharged few days before his death. His last rites were performed at Ambazari ghat in Nagpur on the same day. He is survived by his wife. Pray Almighty that his soul may rest in peace. MANY
OF OUR GROUP
MEMBERS might be knowing who worked in Nagpur Office or have met him in
Staff college our friend Dr. P. Laxminarayanan was a powerful personality with large frame and loud voice, once met cannot
forget him. When he spoke entire floor could hear him. Highly qualified
did his PhD in Economics, accepted Grade B promotion but soon opted for
reversion - was regular visiting professor for Nagpur University. He was very active in most of the organizations - we has his own values and views.
-K.S.Iyer
A lonely man
.... Relations between the boss of North Block and the head of the country’s Central bank and apex monetary authority have not always been smooth. But rarely have their differences of opinion been so out in the open. Duvvuri Subbarao was literally hand-picked for the post of finance secretary by Mr Chidambaram. But the two stopped seeing eye-to-eye after the former became governor of the Reserve Bank of India.............
CPI and inflation
In the forthcoming mid-quarter review of policy the Reserve Bank of India (RBI) should announce shifting its focus to consumer price index (CPI) from wholesale price index (WPI). It has already given up the inappropriate use of the concept of "core inflation" derived from WPI. ...........
Exchange risk
........In the proposed swap, the RBI is only subsidising the swap cost which actually is forward premium determined by market forces. The RBI would be earning only nominal return on its dollar funds - thus the effective cost to RBI is higher..........
Easing troubles in the long run
....Monetary policy in these economies will be at the mercy of the policies of central banks in the main centres of global finance. What emerging markets face is not so much the classical ‘trilemma’ posed by the ‘impossible trinity’ but a dilemma: to have an independent monetary policy or free capital flows. They cannot have both..........
A tale of two mistakes
It is a rarest of rare case when Reserve Bank of India (RBI) publicly acknowledges its mistake, even if committed inadvertently. Last Friday, a press statement from the central bank -- on the highly sensitive issue of new bank licences -- said, it has inadvertently left out an applicant's name from the list of companies that has applied for bank licence..................
Lazy banking targeted by Rajan helps lower yields
...The days of lazy banking are going to be over soon, Vishal Narnolia, Mumbai-based analyst at SMC Global Securities Ltd., said in an interview on 5 September. The central bank has made it clear that they will be looking at pushing loans and balance sheets have to be cleaned up. Although there could be pain in the short term, profitability at lenders will go up in the long term........
Thank You Governor, but What Do We Do With Our Police and Politicians?
Letter from a Banker
............As
a banker, what made me extremely pleased is the way you particularly
approached the bad loans issue. The banking industry is crippled because
of spiralling bad loans. I dare to write to you because I believe you
mean business. Sir, you said that promoters do not have a “divine
right” to continue if an enterprise flops and use the banking system to
recapitalise their failed ventures. And how right you are when you said
that we need to deal separately with wilful and genuine defaulters.
Banks act as a proxy to the economy and so when the economy isn’t doing
too well, we are bound to see some rise in NPAs...........
IS #RRR 007?
.........To his credit, the previous Governor D Subbarao, on more than one occasion, admitted that the RBI Governor is an unelected official, and he, therefore, needs to be subjected to accountability before he can make too many noises about autonomy. Rao wanted accountability before a select committee of Parliament; but having been a finance secretary in an earlier avatar, he never made a direct pitch to be treated outside the control of the finance minister. Having worked as a North Block mandarin for 12 months,#RRR, too, has hinted in the inaugural statement his role to serve an elected Government’s policies (the two question marks are mine):..........
In Love with Rajan, Re may Flirt with 60
..............The
local currency had its best four-day rally in four decades after
Reserve Bank of India Governor Raghuram Rajan moved to reverse sentiment
on policymaking, introducing several measures soon after taking over
last Wednesday.........
The ‘Rajan-effect’ on India’s rupee may not last long
.....The “Rajan effect” is not lost on markets. The rupee rallied 2.2% from Friday to 63.84 per dollar yesterday. The currency, which fell to a record 68.845 on August 28, climbed 6% in the past four days, the most since at least 1973, according to Bloomberg data. Stock markets seem very optimistic too. The benchmark Sensex index rallied over 1,700 points in 4 days, 727 yesterday alone, to cross the 20,000 mark. Time to think the former International Monetary Fund chief economist is the miracle man to drive India’s ailing economy out of its worst financial crisis since 1991? Have a closer look at the deeper issues. ..........
RBI asks banks to consider options to meet note, coin demand
........."Banks may explore the possibility of offering these services through business correspondents and consider engaging the services of cash in transit entities for the purpose of distribution of banknotes and coins, thereby addressing the last-mile connectivity issues," .................
HC seeks affidavit on launch of ‘parallel economy’
Acknowledging the PIL filed on the introduction of coupons and due slips instead of currency by several private bus operators, the Calcutta High Court Tuesday directed the Centre, Reserve Bank of India and the state government to file an affidavit within four weeks. India's Smile, a social organisation, has filed a petition alleging that private bus operators had printed coupons and manufactured plastic coins, which they forced the passengers to accept instead of currency notes and coins........
Sebi: Transfers on slow track
............A lot of transfers, which were due to take place in the new financial year, are yet to go through, according to a person familiar with the matter. The bulk of the pending transfers may only take place after there is clarity on the term of U K Sinha, chairman of Sebi, said the person. Sinha's initial three year-term would end in February 2014, around six months from now...........
Panel headed by former Sebi chief submits report
The high-level committee, set up by the Ministry of Corporate Affairs (MCA) last year under the former Securities and Exchange Board of India (Sebi) chairman M Damodaran, has submitted its report on changing India’s regulatory environment for making business environment investment friendly.............
Disclose details of 100 dormant accounts: CIC to postal dept
.........During the hearing Agrawal claimed that the postal department in its reply had said that unclaimed balance of Rs 752.44 crore are lying in 2.49 crore accounts. He claimed postal authorities have taken no steps to return the money to the legitimate claimants. During his arguments, Agrawal said that unclaimed balances are prone to fraud. He claimed Reserve Bank of India has now directed banks to transfer dormant balances to the government of India after a period of 10 years as is being done in case of unpaid dividends which are required to be transferred to the government after three years..........
Women’s bank likely to begin operations on 19 November
......The bank, named Bharatiya Mahila Bank, will begin operations with 6 branches spread across the country. Headquartered in Delhi, it will be scaled up to 39 branches and 127 cash machines and serve more than 33,000 customers at the end of the first year. It aims to become profitable by the fifth year of operations. The bank aims to service women and women-run businesses, support women’s self-help groups and their livelihoods and promote further financial inclusion in a country where only 35% of Indian adults have access to a bank account. Usha Ananthasubramanian, Executive Director at Punjab National Bank, will head the bank, which will predominantly employ women. The bank will initially be staffed by officials seconded from other public-sector banks...........
RBI launches inflation survey
......The RBI has requested other interested individuals not covered by the survey to give their inputs by downloading the survey form from its Web site and then sending it to the central bank by email. The RBI uses the results of this survey as one of the important inputs to the monetary policy.
RBI compliances getting tougher for NBFCs
............There were times when non-banking financial companies (NBFCs) had their own set of privileges over banks. The compliances laid down by Reserve Bank of India (RBI) were far more lenient for NBFCs than those for banks. But gone are those golden days and now even the NBFCs are under RBI’s continuous screening. Having said this, the new compliances for NBFC came from the famous Sahara Case..........
KMSS lambasts nationalised banks
GUWAHATI, Sept 10 – The Krishak Mukti Sangram Samiti (KMSS) today lambasted the nationalised banks for allegedly siphoning off the lion’s share of the money deposited by the people of the NE region to other areas of the country. The Samiti has announced an agitational programme to gherao the local headquarters of the State Bank of India (SBI) here tomorrow in protest against this activity of the nationalised banks........
Criteria for new banks
..The objectives of licensing new private banks haven’t gone beyond the generality of hoping they make banking more ‘inclusive’. But objectives are vastly different from motives — the former are for public consumption while the latter is the hidden reality. To hope all private banks with their profit, or worse, private agendas, to drive ‘inclusive banking’ is a joke. And one’s certain a man of Jalan’s experience knows this only too well. Still, he has a mandate to be fulfilled as best as he can..................
Has mobile payment bug bitten you yet?
........Mobile payments have covered the first few miles in terms of popularity, but still have a long way to go, especially when we look at plans afoot. In his first speech after taking over as Reserve Bank of India (RBI) governor, Raghuram Rajan stated that mobile payments can be a game-changer both for the financial sector as well as for mobile phone companies. In fact, keeping retail customers in mind, he plans to set up a technical committee to examine the feasibility of using encrypted SMS-based funds transfer using an application that can run on any type of handset. If you are not already making your payments through mobile phones, we’ll help you understand the systems...........
RBI penalises Jamia Cooperative Bank Ltd,
......The penalty has been imposed on the bank for violation of (i) Know Your Customer (KYC) and Anti Money Laundering (AML) norms insofar as carrying out sufficient customer identification procedures, ascertaining the identification of natural persons behind entities, carrying out enhanced due diligence and appropriate risk categorisation were concerned; (ii) non-compliance of Income Recognition and Asset Classification (IRAC) norms by transfer of funds from one account to another; (iii) involvement of the directors in day-to-day affairs of the bank; and (iv) diversion of funds from loan accounts through current/savings bank accounts of borrowers to firms in which directors have an interest.............
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