Government appoints R Gandhi as deputy governor of RBI for 3 years

............Significantly the appointment was notified a day after the central bank gave in- principle approval to two entities to start a bank. RBI had shortlisted three of its executive directors' to succeed Anand Sinha who retired in January this year including R Gandhi, P Vijaya Bhaskar and B Mahapatra............... 

Read - ET

VITALINFO on behalf of all its readers extends Heartiest Congratulations and Birthday wishes to Shri R.Gandhi.

Pragmatism Wins the Day

..........In contrast, the average tenure of RBI governors has been less than five years. Manmohan Singh was governor for little over two years. Even so, six months is too brief a period to pass judgement on the performance of RBI governor, Raghuram Rajan. With that caveat in place, I dare say..............

Read - ET

RBI's welcome conservatism

.........Perhaps the RBI has a longer game plan. In its statement, it admitted that its approach was "conservative" and opened up the prospect of more licences being issued over time, particularly within the differentiated licence framework that was proposed last year. This implies that more specialised and bounded institutions with a focus on inclusion are likely to be issued licences soon. But, going beyond licensing issues, the fact is the future of Indian banking, including the goal of ............

Read | Business Standard

Will New DG Live Upto Expectations and Give New Direction to RBI, PS Banks and Their Employees ?

........Although Chakbrabarty had headed two PS Banks, he never realised the pitiable condition of their employees.  As and when he got a chance,  he showed his outbursts against PS bank officers and blamed them for the rising NPAs and other ills.   He also felt strongly that PS bank employees are over-paid and better paid than private sector banks.  This has done the biggest damage to the credibility of PS Bank staff, who are still struggling with IBA for wage revision which is already over 17 months overdue.    ........

Read.........

Annual General Meeting of RBI Retired Employees Association Ahmedabad

Dear all

The AGM of  RBI  Retired Emp. Association was held at RBI Officers' Lounge RBI Main Building Ahmedabad on 30 March 2014. Shri T.G.Nair  General Secretary of All India Retd. Emp. Association was also present.  While addressing the members shri Nair struck an optimistic note about pension updation. He was confident about sorting out of various conditions put forth by Ministry of Finance through the good office of the governor. He called on the members to be ready to attend another  Special General meeting  to celebrate pension updation. Post meeting dinner was hosted by RD RBI Shri Sudarshan Sen for which a formal letter of invitation was also sent to all retirees by RBI. About 400 retirees attended the meeting with their spouse.  The terrace of Officers' Lounge was jam packed.  The Bank also greeted retirees with the gift of a pen and the spouse with  a rose flower. It was very good gesture on the part of RD RBI Ahmedabad for which he was thanked by all. After conclusion of the meeting, Shri Sudarshan Sen RD and Shri V.S. Das former ED also joined the gathering. Both of them addressed the gathering. This was followed by a short musical evening in which old  Hindi film melodies were rendered by S/Shri Sen, Das, Bhatt, Dhondiyal and a few others. Thanking RD, Shri Nair said that this is a very good beginning by Ahmedabad Office  which may be replicated at other centers. 

- M.L.Maheshwari  

Obituary

Mr. P.V. Subramanian, Retd. RBI, Kolkata passed away on 30.03.2014 at Bangalore. Phone: 080-4953 0572.

Silent on the issue......

My View on  "Bankers ask EC to bar defaulters from LS polls": 

This request is being made prior to every elections but the Election Commission chose to remain silent on the issue. If the Financial institutions have to be cleaned up, this is very important. It is also important that the Directors who have track record of being defaulters should also be disqualified on the Boards of Banks and FIs, Insurance Companies and NBFCs. 

- Yerram Raju

Well done RBI

....The present decision reflects RBI's maturity and the  continuous future responsibilities it has, to have a very healthy banking to cater to the needs of equitable development of the economy. Well Done RBI, the only Institution which can be proud of for its integrity and Corruption free practices. The nation  also can be  really proud of for having such institutions ............

Read.......

This we call as autonomy!!

My View on  "Justice delayed is justice denied..............": 

I opted to retire from the SBI when I was a Regional manager in 1994 when my basic was Rs.11550 but pension pegged at not half average pay but at Rs.4250 as applicable then. Now my pension is around Rs.15000 a month including the DA. All the appeals in various courts hang on indefinitely because these are not so important issues for them. For the SBI, the Chairman says the clearance from the Finance Ministry is required and they are sitting tight on this issue for decades. Those who retired between 1993-2000 are very few survivors - in just a couple of thousands and the liability from the pension fund would be minimal compared to the outgo for those who sought voluntary Retirement under a specific scheme and the regular retirees. What should be in the domain of Bank's decision has shifted to Government and this we call as autonomy!! 

- Yerram Raju

Herculean task

My View on  "RBI will act on data surprises that are durable: R...": 

The observation “Banks’ compulsory bond holding now is 23% but they hold close to 29% and up to 24.5% holding, they do not need to trade.” and Dr Rajan’s response which read:

“We will look at both those issues. To the extent that the new government can provide an assurance that the fiscal situation is under control, we can move to bring SLR down, purely as a way of reducing distortions in the system. We can’t bring it down so far that we hit liquidity coverage ratio limits, but we will bring it down to the extent we need, consistently and prudentially. It is good for the economy if there is a credible, sensible fiscal consolidation path the new government lays out.” are loaded with much deeper apprehensions about the fiscal policy management. Both the temptation for banks to park more funds in SLR securities and the likely chaos that may emerge in ensuring ‘buyers’ for government securities if banks unload their holdings are issues to be tackled. Creating a real time market for such securities, which is a pre-requisite even for the Government’s pet project of transfering Public Debt Management from RBI to GOI, will call for confidence building of a much higher level, which for the present looks a herculean task.

- M G Warrier, Thiruvananthapuram 

Why RBI’s decision on a Post Bank of India is a slap for Finance Ministry

.......While prior clearance of their parent company was necessary for the private players who had applied for a license, for the postal department, it was the clearance of the government of India, or more specifically, the finance ministry that was mandatory. Without such a clearance, the RBI could have rejected the application, which it didn't do............. 

Read.........

Retain PSU bank talent or face national calamity: RBI Rajan

...........Though Rajan did not confirm whether any market-based remuneration or lateral hiring for PSBs is on the cards, he did say discussions are on with the government on the matter. "We have to ensure that these banks have the capacity to compete and many of them recognize what needs to be done and have started on the path, but we should support them,"

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

Location, governance gave Bandhan edge over others

.........“I would think geographical location was a key factor. Bandhan is located in East India, most of which is financially excluded. While economic growth in certain eastern states like Bihar has picked up in recent years, there still are a lot of unbanked villages in this part of India. To my mind that could be one of the main reasons,”.............

Read | Business Standard

Many more entities will get banking licence

.......Even if it is two the good thing is that we have made a beginning. Now the thinking at the government and the RBI level is that we should have a system where licences can be given on tap basis............

Read | Business Standard

Housing finance firms approach NHB, say banks poaching customers

.............."We are serious about this issue. We are looking into the extent of the problem, categories in which the loans are being taken over and the impact of it. When this data is available, we will analyse the situation and look for solutions.".............

Read | Business Standard

RBI comes to Kerala’s rescue

The Reserve Bank of India (RBI) has granted some respite to the State government by allowing it to issue bonds worth Rs.1,000 crore that might help it tide over the financial crisis for the present. Finance Department sources told The Hindu here on Thursday that funds mobilised by issuing bonds would have to be expended totally on paying salary and pensions............

Read - The Hindu

R. Gandhi to be new RBI deputy governor

R. Gandhi, an executive director at the Reserve Bank of India (RBI), has been named as deputy governor, succeeding Anand Sinha, whose term ended in January. Gandhi’s name was approved by the appointments committee of the cabinet led by Prime Minister Manmohan Singh,...............

Read - Mint

Shri Gandhi will look after the following portfolios: Department of Banking Operations and Development, Department of Non-Banking Supervision, Urban Banks Department, Department of Expenditure and Budgetary Control, Department of Information Technology, Legal Department, Premises Department and Risk Monitoring Department.

Licensing for competition

..........Whether or not this is sufficient to qualify as a “dramatic remaking of the banking landscape”, differentiated licences have clear advantages over a system that favours the creation of new banks every decade or so and which are virtual clones of the existing ones. Such a system imposes undesirable regimentation — for example, non-banking financial companies (NBFCs), which usually have a core expertise in some area..........

Read - HBL

A touch here, a tweak there - A.Seshan

........Neither the policy paper nor the governor’s statement made any reference to the estimates of money supply, credit or deposits in the coming year. I took the view in the past that the RBI should not provide estimates of money supply, with room for 5 per cent inflation after reckoning for GDP growth and income elasticity of..............

Read - HBL

RBI's sensible approach

.......It is not certain how and in what shape the fiscal policy will be under the new government. By keeping policy rates unchanged and not succumbing to the pressures of the market, the RBI governor has played his cards well..........

Read | Business Standard

Inconsistent blueprint?

......... When RBI suggests that it wants to withdraw from the respective boards of PSBs, it assumes that the PSBs' problems would continue and it does not want to become a party. The conflict of interest has come as an easy alibi for the recommendations............

Read | Business Standard

The missing Rupee

.... A software glitch on the central bank's computers possibly since the release made no mistake with the dollar sign. But it can almost be considered a comment on the role foreign currency plays in our financial markets.

Read | Business Standard

G S Sandhu inducted in RBI board

The government has nominated financial services secretary Gurdial Singh Sandhu, in the board of Reserve Bank of India in place of Rajiv Takru, who has now moved to the revenue department.

Business Standard

Welcome move.............

My View on  "Justice delayed is justice denied..............": 

Ref: TOI report on one rank one pension for Justice:

This is a welcome move and should set at rest the impression that ‘social security’ is about protecting the livelihood needs of the poor only. The roots of several corrupt practices can be traced to disparities in compensation structure. The purpose of pension is to ensure the employee who has spent his life serving an organisation/system/service gets a regular income post-retirement to meet the lifestyle needs of himself and his family commensurate with those while in service. Thus protecting the purchase power of the pension amount is also part of the social responsibility of the employer. Several veterans are continuing to ‘serve’ in different capacities post-retirement only to earn their daily bread. 

- M G Warrier, Thiruvananthapuram 

RBI and protecting banking customers

..........These are only illustrative and not exhaustive suggestions for the RBI to ponder over and work out comprehensive consumer protection regulations, which can play an important role in considerably improving the banking system comprising of  responsible, reliable and consumer friendly banking institutions, who can be trusted and relied upon by the billion people for the greater good of our country.

Read - Moneylife

Customers hard hit.............

My View on  "Customers may be spared from keeping minimum balan...": 

Every time when banks tinker with the system of providing services, the hard hit is only the customers. Only a couple of years back, RBI issued guidelines that banks should allow ATMs of other banks to be used by customers without any charge for such use. But, now, this decision has been reversed putting the customers at a loss. Not all banks have their ATMs located in all places. In India, ATM penetration is one of the lowest. Instead of increasing ATM penetration, making the customers to pay for use of ATMs other than those in which they have their accounts is retrograde action. RBI should rather facilitate better banking by making banks to cut costs on areas which are considered unproductive instead of forcing the customers to pay.

Similarly, making too frequent changes and charging customers for services which are basic for banks to provide will be detrimental to the interest of the customers.

Customer service is far from satisfactory. I have a couple of instances where customers are made to run to pillar to post to get redressal of their genuine grievances. But, nothing has happened. In one instance, a poor customer (a gardener by profession) of SBI, Andheri(W) branch depsited a govt cheque of Rs.63,723/- on 11 March 2013 is yet to get credit of the amount to his SB A/c. 10218281741. Despite repeated visits and letters no action is taken. Complaint to the Banks Ombudsman is also lodged. Such is the plight of poor customers. Who is going to make good the loss to this poor customer (loss of interest, travel cost, wage lost etc)? Huge NPAs where defaulters are not considered as willful (Kingfisher airlines)have eroded the profit of the banks forcing the government to recapitalise them which is ultimately your money and my money. RBI should address these issues and make the banks accountable for poor services rendered by them. Will RBI intervene and redress this sample case mentioned by me in this message? 

- Santhanam

RBI FORMATION DAY celebrated by RBICHENNAIFRIENDS Group

RBI FORMATION DAY

Celebrated at Marina Beach, Chennai on 1st April 2014 by

RBI Chennai Friends

Dear Friends,

You are aware that RBICHENNAIFRIENDS Group invited its members to assemble at Marina Beach at 5.30 p.m. on 1st April 2014 to celebrate  RBI Formation Day. We are extremely happy that more than 50 members turned out at very short notice. The cool and gentle evening breeze with the backdrop of roaring waves of the sea set the most conducive ambiance for the members to meet  and share their fond memories about the great institution they served. Members at large appreciated the proposal to organise such an event to show our gratitude to the great institution. 

Shri S.Venugopalan in his introductory speech praised the efforts of the moderator to convert his suggestion to a reality and shaping it to an impressive show. He said that completion of 80 years of age in the life of every Indian calls for a big celebration and in a similar way we should take today's event as a lead for planning the 80th Birthday of the Bank next year as a mega event. 

Shri Kurien Chacko entertained the gathering by narrating an incident that happened at the youth hostel recently and tactfully converted it into a brain teasing puzzle. Sri T.V.Mukundan's  Tamil Translation  of Chacko,s  narration made the memebrs roar with  laughter. 

Sri T.V.Subramanian had a great praise for the RBI. He said that most of the members present at the event belong to the batch of members who retired from the Bank between 1986 and 2004 who should consider themselves as a lucky lot. He said they could enjoy the benefits of many awards, settlements of wage revisions, perks and other facilities and more importantly the pension scheme. He added that the pension scheme enjoyed by us is not made available to the pre-86 retirees as well as post 2004 recruits. He wanted the moderator to forward a report and the photos of this get together to the Governor and  to ensure that the proposed 80th Birthday of RBI should be celebrated in a grand way involving the Bank's executives at the top most level. 

Shri Mushtaq Ahmed endorsed the views of Sri TVS about the greatness of the institution. He mentioned that we should feel happy as the prolonged struggle of the employees for restoration of Pension updation is coming to a close. He said that Updation of Pension has become certain and only the modalities of fixing formulae for the Basic Pension etc. is under negotiation by the United Forum. 

Shri S.M.Sendil draw a reference to the olden days of Sri Ashis Sen etc. where the service conditions were very poor. He said staff use to leave office only around 8.30 p.m and getting permission to leave office half an hour early for some valid reason was a herculean task. He praised the role of the Association which alone was responsible for bringing vast change in the system to a comfortable level. Sri Sendil also rightly stated that we should develop the feeling of contentment with whatever we are paid according to our times without making comparison with others. 

Shri V.Subramanian (Aranthai manian) recalled the day he joined the Bank after resigning his job from Lucas TVS for a salary difference of Rs.50 per month but got very much dejected when he was posted to claims section and asked to fill up Money Order forms.  He informed that he could realise later the great role of RBI in managing the monetary policy and currency management and that sending money thro' money order also was a part of the job. He said that he still cherish the days when he was actively associated with the Recreation Club and successfully organised a Chess tournament between the Indian Grandmaster Sri Viswanathan Anand and  32 Club members at a time. 

Smt.Uma Rajaram, a serving employee said that she came to RBI Chennai on a  transfer from Hyderabad office. She said she was overwhelmed by  the support and affection shown by Chennai colleagues. She felt sad that the warmth, love and bonding is missing in  the present set of  colleagues. 

Shri S.Sankaranarayanan appreciated the activities of the group and said that it was the Chennai group which has first posted a message in the Facebook  about the celebration of RBI formation day. 

Although Sri G.S.Shunmugam could not get his chance to address the gathering he was found cutting many jokes with the members there in groups. 

Shri S.Subramanian (German Subbu) attended the meet late and could not get his chance to address the gathering. At the same time  we should praise him for coming to Chennai from Bangalore to attend the event. 

Snacks and refreshments were served to all the participants. We convey our thanks to S/S. Janardhanan, Devarajan, Venugopalan and Logeswaran who assisted in organising the snacks and refreshments. 

Although we decided not to receive any payment from the members for this event some members have come forward with their voluntary donations. (S/S.T.B.Sathyanarayana, C.Murugan, K.Govindarajan, German Subbu and P.T.Veeraiyan) . We thank all of them for their gesture. The event was concluded around 7.15 p.m.

Yours dearly,

Chandraiah

Forwarded by Madan Gauria

RBI will act on data surprises that are durable: Rajan

........“To the extent that the new government can provide an assurance that the fiscal situation is under control, we can move to bring SLR down, purely as a way of reducing distortions in the system. It is good for the economy if there is a credible, sensible fiscal consolidation path the new government lays out,”...........

Read - Mint

RBI grants in-principle approval to IDFC, Bandhan for new bank licences

........The "in-principle" approval granted will be valid for a period of 18 months during which the applicants have to comply with the requirements under the Guidelines and fulfil the other conditions as may be stipulated by the RBI." 

Read - ET

My View on "EC clears way for RBI to issue new bank licences": 

It is a welcome decision of the EC to allow the RBI to do it normal functioning. But, in issuing licences to two NBFC-MFIs viz., Bandan and Janalakshmi, RBI may well consider if by issuing licences to these two entities, they may lose the character of providing microfinance services to the unreached as they may limit it to the extent of priority sector commitment only. Then these would become another new generation banks with microfinance and financial inclusion becoming show-case activities and not prime activities as hitherto being done by these entities. 

- Santhanam

India Inc surprised by rejection, to reapply

Corporate aspirants for banking licences are disappointed with the Reserve Bank of India (RBI) rejecting their applications. Top executives said they would re-apply for the next round as and when the RBI decides to start the on-tap licensing process............

Read | Business Standard

Twists and turns in the new licence saga

Former Finance Minister (now President) Pranab Mukherjee first proposed the entry of new players in the banking sector during his Union Budget speech for 2010-11. When Mukherjee made the announcement, his speech surprised many in the central bank, as consolidation of existing banks was the most-debated topic in those days.............

Read | Business Standard

We'll build a bank via organic route: Vikram Limaye

.......The RBI nod gives us visibility about the days ahead. There is already a plan in place for activities to be done in the next 18 months. The focus will now shift to execution. It will involve activities such as setting up a holding company and moving some businesses into a distinct corporate body to meet..............

Read | Business Standard

RBI deputy governor clarifies spreading mark-to-market losses lapsed on March 31

Reserve Bank of India Deputy Governor H R Khan clarified that only the time limit for spreading bond losses held under banks' mark-to-market portfolios had lapsed on March 31, and not the waiver on bringing down the ratio of debt under the held-to-maturity segment..........

Read | Business Standard

Policies of new government to influence RBI's stance from June 2014 onwards

..........On balance, while the RBI stayed on hold today as expected, we think the election outcome and the new government's economic policies are likely to have a material influence on the course of RBI policy from June 2014 onwards. While not a structural factor,............ 

Read - ET

RBI To Withdraw All FDI Pricing Guidelines!

......When it came to the pricing of options on compulsorily convertible debentures and preference shares, RBI permitted the use of ‘any internationally accepted pricing methodology’.

Later in January,  G Padmanabhan, ED, RBI indicated to me that things might change!

Here’s an excerpt of that conversation….....

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

Strengthen credit appraisal for gold metal loans: RBI to banks

.......“In case GML is given by the nominated bank to its own existing customers, gold metal loans under the scheme may be carved out within the credit limit sanctioned by the bank. In case of new borrowers, the gold metal loan limit may be fixed after carrying out a detailed credit appraisal and due diligence,”...........

Read | Business Standard

Inflation-indexed bonds may get a makeover

...........“When you have capital gains accrued from non-equity funds, you pay tax only after factoring in indexation. Similarly, when RBI says that it is contemplating the benefit of indexation for inflation-indexed bonds, this means that it will factor in the effect of inflation when it comes to calculating the tax on gains,” ..............

Read - Mint

RBI chief cautious, sees brighter future

The good news for India Inc and all borrowers is that there will be no interest rate hike or further policy-tightening measures if inflation stays on its southward journey along the intended “glide path” laid out in the Urjit Patel committee report.............

Read - Deccan Chronicle

Unexpectedly as Expected, for Once

............It is interesting to note that after seeming to endorse a monomaniacal form of inflation-targeting as recommended by the Urjit Patel report, the RBI is taking a more nuanced approach even to its preferred measure of inflation, the combined consumer price index. It will not give in to the statistical guile of low inflation over ..........

Read - ET

‘Loose fiscal policy calls for tight monetary policy’ - Charan Singh

............"The Monetary Policy has both positives and negatives. The positive  component is that interest rates have not been raised and term repos have been encouraged. Further, Inflation targeting has been put on hold. The negative components are that too much importance is being accorded to prices of food and vegetables, no measures have been announced to revive growth in industry; no mention of improving the NPAs, or credit to the.....................

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

Steps to make RBI’s monetary policy transparent

........In particular, the yearning for and excitement about decisive governance could easily translate into activist fiscal policy of the pump-priming variety. In such a scenario, the central bank may have little choice but to hike rates again to preserve its credibility. In other words,.........

Read - Mint

Why Raghuram Rajan’s battle is far from over

.........the Indian economy is now far more stable than it was in recent years, thanks to the gradual reduction in inflation as well as lower risks to economic stability. That gives Rajan some breathing space. However,..............

Read - Mint

The Reality of Financial Inclusion

Financial Inclusion means the inclusion of the poorest of the poor into the banking stream. It was introduced after the recommendations of Khan Commission set up by RBI in 2004, with the aim of extending banking facilities to the poorest of the poor. The benefit may be seen when looked at the expected benefits like Electronic Benefit Transfer wherein social payments to common man can be made directly. The concept was novel and ..............

Read - Greater Kashmir

El Nino weather phenomenon may have a bearing on inflation: Reserve Bank of India

..........."It's not a given that El Nino will happen and it's not a given that food production plummets. If food production plummets, it is not a given that inflation across the board will be high...I don't think at this point we can anticipate precisely what will happen," 

Read - ET

Search panel recommends Mundra for RBI Deputy Governor post

The search panel headed by RBI Governor Raghuram Rajan is believed to have recommended the name of Bank of Baroda chief S S Mundra for new RBI Deputy Governor in place of K C Chakrabarty who has opted to leave the central bank ahead of his tenure. ...................

Read | Business Standard

Justice delayed is justice denied..............

"If Government rules are brought in in support of updation, we have to accept that updation can take place only once in 10 years.  Shri Donde, quoting the late Governor, Shri R..N. Malhotra, has also agreed with this point. The rationale for updation of pension is that pensioners who had retired in a particular grade (regardless of the date of their retirement) have to be treated equally and paid the same amount of pension. If pay revision takes place,say, after 5 years, employees who retire after this pay revision would have to be paid pension on the basis of the revised pay which would inevitably result in an invidious distinction between pensioners (who had retired in the same grade) if updation of pension does not also take place after the pay revision. This is the reason why pay revision and pension updation have to go together and can take place only with the periodicity of 10 years. Furthermore, I had also mentioned in one of earlier mails that if the RBI have counted certain allowances for 'pay' and accordingly also for retirement benefits which are not in alignment with the Government rules, we have no alternative but to fall in line with the rules in the Government. 

I agree that it is irrelevant (also sheer arrogance)  on the part of the Government to bring in the issue of rationalisation and review of 'perks' of serving employees while discussing the issue of updation even while some of us may legitimately opine that these 'perks' have gone a little far in recent periods for an organisation like the Central Bank of the country ( which is not a commercial organisation). Governor, with his formidable stature, standing, intellect and skills in argument ( two famous books which he had authored are master pieces and a delight to read)  would have to impress on the Government this point and insist on this issue being delinked from pension updation and taken up separately and discussed. I am sure he would do it and hope he would do it immediately. Finally,as all of us know, time is of the essence for very obvious reasons and hence implementation of updation of pension cannot brook any further delay!! "

 - Forwarded by Shri A.Chandramouliswaran

Also read - TOI Forwarded by Shri L.R.Parab

Poll squad detains RBI trucks carrying Rs 5 cr suspecting bribe for votes

An over-enthusiastic election squad detained 7 RBI trucks carrying Rs 5 crore in Rs 5 coins heading from Kolkata to Chennai, early on Monday. The squad comprising police and revenue officials suspected the money was meant to bribe voters. The truck was finally released following the intervention of senior RBI officials.............

Read - Bangalore Mirror

Employee-benefit provisioning to hit public sector banks hard

...........While PSBs in the first nine months have charged additional R4,250 crore to income statement towards amortisation related to enhancement in gratuity limit and re-opening of pension option for existing employees (in line with RBI’s February 9, 2011, circular); some banks like SBI have made provision of R1,800 crore towards additional pension liability. PSBs have also made additional provision of nearly R3,300 crore in the nine-month period on ad-hoc basis for wage revision effective November 2012..........

Read - FE

RBI says United Bank problem one of governance, not ownership

............."All issues point towards corporate governance. We have written to the government to take a set of steps to improve corporate governance and it is not only for UBI but the entire banking system as a whole," .....................

Read - ET

.......“We haven’t conducted any probe. It is the bank chairman who wrote to the governor as well as the FM, saying that, at her bank, accounts are not classified as NPAs and requested the RBI to go for a forensic audit.” ........

Read - FE

Customers may be spared from keeping minimum balance in savings accounts

Bank customers may be spared from the pains of maintaining a minimum balance in savings account as Reserve Bank of India has directed banks to do away with the practice of levying penalty for non-maintenance of it. 

Read - ET

RBI open to merger of banks: Rajan

..............."It's better that the banks themselves voluntarily decide where more value could be created if they merge. All I am saying is that we are open and there is room for both bigger banks as well as smaller banks. So, what we are saying is that we will be happy to consider if banks decide (to merge),".....................

Read | Business Standard

RBI wants govt to pare stakes in banks

.....Stressing the importance of granting complete autonomy in the day-to-day operations of public sector banks so that these could effectively compete with their private sector peers, RBI said such autonomy was contingent upon the government reducing its stake, especially at a time when the Centre was resorting to borrowing for capital infusion in these banks................

Read | Business Standard

Contrasting view on PC screen

.......Chidambaram today went on to criticise his nominee for the RBI governor’s job — Raghuram Rajan — terming his seeking of a clearance from the Election Commission for the new bank licences as sending a “wrong signal” and a case of “playing it safe”..........

Contrasting view on PC screen

EC clears way for RBI to issue new bank licences

.....“The Commission has considered your request seeking guidance of the Commission whether it would be appropriate for you go ahead with the announcement of in-principle approvals for Banking licenses in view of the current enforcement of the Model Code of Conduct,”...............

Read - Mint

On tap licences first for niche banks, then for universal banks: Rajan

............."This will allow people to allow banking capabilities with relatively small size corporations, which will allow them to apply for full banking licenses down the line. So to facilitate and expand entry, we need to look at both on-tap licenses, which is examined regularly, applicants every few years and have differentiated licenses,"..........

Read | Business Standard

RBI temporarily suspends NBFC registrations

.........“These recommendations are being examined by the bank. Several changes to the regulatory and supervisory framework for NBFCs may be called for. Putting in place the required mechanisms is likely to take some time,”..............

Read - Mint

Finance Ministry against raising income tax exemption limit to Rs 3 lakh

The Finance Ministry has rejected a Parliamentary Standing Committee's recommendation to raise the income tax exemption limit to Rs 3 lakh and to adjust other slabs saying that it will lead to an annual loss of Rs 60,000 crore to the exchequer. It has however decided to reduce the age for tax exemption for senior citizens to 60 years from 65 years...........

Read - FE

Foreign Banks Face RBI Stick After Shunning the Carrot

......The RBI’s efforts are in line with other global regulators, which are trying to prevent any contagion effect from economic crisis such as that in 2008. But, foreign banks cite requirement like guarantees from the parent and restriction on dividend payout as impediments in creating local subsidiaries. They are also not happy with the rules on compulsory lending to the priority sector — such as........

Read - ET

Bankers ask EC to bar defaulters from LS polls

The All India Bank Employees' Association (AIBEA) has requested the Election Commission of India (EC) to bar and disqualify candidates from contesting the elections, if they or their companies default on loans to the banks...........

Read - Sunday Guardian

If inflation is 7-10%, lending rates can't be less than 12-14%: Rakesh Mohan

........I don't think the IMF's assessment has been that different from what the Government of India has itself been saying, although it does give a somewhat smaller weight to global factors. There is clearly an impact of the global economic slowdown on almost every country. Coming back to India, we were able to counter the immediate impact ............

Read - BS

Inflation targeting - What's the hurry? - Charan Singh

.....Changes in monetary policy framework deserve focussed attention and a well chalked-out strategy to be successful. Illustratively, the foreign trained but domestically experienced duo of Montek Singh Ahluwalia and and C Rangarajan ensured that the reforms of 1990s were properly sequenced, well calibrated and widely consultative in nature. Only then ..........

Read..........

Targeting Dr Chakrabarty

On 25th April, one of the most forthright and honest deputy governors (DG) of the RBI will retire—three months before his term ends. It is befitting that Dr KC Chakrabarty, who got the post and an extension without the customary lobbying, has chosen to quit before his term ends.................

Read - Moneylife

Kamath leads race to succeed Chakrabarty as RBI DG

Raghuram Rajan headed search panel has zeroed in on a successor to RBI Deputy Governor K C Chakrabarty and PNB Chairman K R Kamath is believed to be top in the reckoning..................

Read | Business Standard

How HSBC Was Made To Pay

.......Although RBI did not send a formal response, the case was examined at various levels. We were also convinced, at that time, that a complaint to the banking ombudsman would be of little use, since its scope is very limited. We requested Dr Chakrabarty to take up the issue of mis-selling of third-party financial products by banks............

Read - Moneylife

Muggers attack, rob home-alone woman

.......The victim has been identified as N. Geeta, wife of Ravinder, a retired employee of Reserve Bank of India. The incident occurred when Geeta’s domestic help left after finishing her work and leaving the main door open. Mr. Ravinder had gone out for some work. The muggers barged into the house and .........

Read - The Hindu

Tech-savvy Hyderabad youngsters take to bitcoins for investment

.........In India, its use is largely restricted, but that is beginning to change. "Barring a few techies, nobody was interested in bitcoins until the end of last year. However, after the RBI warned against the use of bitcoins last December and later changed its stance saying it would not regulate it, the interest levels began to climb," said M Kamlesh, who is all set to start a bitcoin exchange in the city on the lines of similar setups around the world. ............

Read - TOI

Common Causes

............Tarapore is probably the first economist to write a column syndicated in multiple languages. Common Voice has been in print since 1997, and books have followed. Long regarded as a monetary hawk, Tarapore is convinced that high inflation is a cruel tax inflicted on..........

Read.........