........Based on a complaint, the Cyber Crime Cell of CCB investigated the matter. It came to light that the petitioner’s driver purchased a small fraction of shares from the complainant. As a share holder, he obtained a copy of an RBI’s report concerning certain financial aspects of the complainant, doctored it and uploaded it on a website, it was alleged. The IP address of the website was traced to the petitioner............
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.
Monday, April 28, 2014
Private banks shun asset reconstruction firm route to offload bad assets
Even as the public sector banks have made a beeline to dispose of their bad loans to the asset reconstruction companies (ARCs) in the March quarter, private banks are not only unenthused in adopting this route, but have also virtually shunned this.............
Waiting to write ‘history’
..............The latest in the series is an authorisation from the Finance Department to a senior secretary to enter into an agreement with the Reserve Bank of India for opening of the government account in favour of the Governor of Telangana State for carrying on ordinary banking business as well as meeting public debt from June 2 when the State will come into existence.............
Cannot consider Madhu Kapur as co-promoter: Yes Bank board
.....“Madhu Kapur being successor of late Ashok Kapur cannot be considered as Indian partner or Indian promoter and accordingly, cannot inherit the rights under articles of association or the status of promoter of Yes Bank,” the spokesman said. “Since the advocates of Madhu Kapur as start up to any amicable resolution requires the bank to recognize her rights as Indian partner, the board is not in a position to accede to any such request for the reason mentioned above.”..........
The great Indian rate trick
A Reserve Bank of India (RBI) working group’s suggestion to create an Indian Banks Base Rate (IBBR) to which all commercial banks can link their loan rates is yet another shot by the regulator to bring in transparency in loan pricing and ensure better transmission of monetary policy. Reset every month, IBBR will be an average of the prevailing base rates of top 14 public sector banks, seven private banks and three foreign banks. This needs to be done as the existing base rate system has turned into a joke..........
Saturday, April 26, 2014
RBI’s Accountability to Parliament – A. Seshan
Apropos of Deputy Governor (Chakrabarty)'s statement that RBI should be accountable to Parliament I am reminded of the debate we had in the Bank during the time of Dr I G Patel as Governor. A suggestion was then made by the Finance Ministry, at the instance of a Member of Parliament, that the Reserve Bank of India should submit its Annual Report to the Parliament rather than the Ministry of Finance. As a Deputy Director in the then Banking Division of the Department of Economic Analysis and Policy I was asked to handle the matter on a reference from the Secretary’s Department. At this point of time I can only remember a few points I made then. In the first place, I argued that even the so-called independent central banks of the time, with the exception of the Bundesbank, were losing that status. For example, I pointed out the fact that the Federal Reserve was being subjected to public audit and the Chairman of the System needed to appear before the Congressional Committees to justify the central bank’s policy from time to time. The confrontation between President Truman and the US Federal Reserve System on the question of who decided the Treasury Bill rates was resolved on the understanding that the Fed was ‘independent within government’ and there was no absolute independence whatsoever. I proposed that there might not be any objection to the proposal from the Ministry of Finance and the RBI need not feel panicky over the matter. I do not know what the final reply was from RBI to Government. Surprisingly the RBI History has not touched on this episode.
Even now the officials of the Bank appear before Parliamentary Committees like the Estimates Committee to answer questions on the RBI’s policy. I myself was a member of the delegation from the Ministry of Finance that appeared before the Estimates Committee headed by Shri Jaswant Singh to discuss public debt. It was called in the context of my article on the burden of domestic public debt in India that had been published in the Reserve Bank of India Occasional Papers(June 1987) wherein I warned of the possibility of an Internal Debt Trap. It led to an intense public debate in the press and the Parliament with appreciative comments from Shri N A Palkhivala in all the budget speeches he gave in 1988 all over India. There is already accountability of the Bank to Parliament. Whether it can be further enhanced by the Bank being asked to submit its Annual Report to Parliament where it could be discussed like the Economic Survey should be a matter for public debate. There are many other issues like the objectives of monetary policy, autonomy of the Bank, etc., brought up from to time. I have suggested in the past that, instead of dealing with them in an ad hoc and piecemeal manner it will be useful to have a high-power committee on the working of the Reserve Bank of India that will inter aliaprepare a new law to replace the Reserve Bank of India Act 1934 after examining all the issues and keeping in mind trends in central banking in the new century. The thinking on central banking has undergone marked changes ever since the RBI Act was passed. In the last quarter century many central banks of both the developing (eg. The Philippines) and the developed (eg. New Zealand) countries have enacted legislation to replace the existing Acts on the central bank. It is time for the new government in New Delhi to consider the matter on a priority basis.
- A.Seshan, Economic Consultant,
{Former Officer-in-Charge, Department of
Economic Analysis and Policy,
Reserve Bank of India, and
(IMF) Adviser to National Bank of Kyrgyzstan and
Bank of Sierra Leone}
Even now the officials of the Bank appear before Parliamentary Committees like the Estimates Committee to answer questions on the RBI’s policy. I myself was a member of the delegation from the Ministry of Finance that appeared before the Estimates Committee headed by Shri Jaswant Singh to discuss public debt. It was called in the context of my article on the burden of domestic public debt in India that had been published in the Reserve Bank of India Occasional Papers(June 1987) wherein I warned of the possibility of an Internal Debt Trap. It led to an intense public debate in the press and the Parliament with appreciative comments from Shri N A Palkhivala in all the budget speeches he gave in 1988 all over India. There is already accountability of the Bank to Parliament. Whether it can be further enhanced by the Bank being asked to submit its Annual Report to Parliament where it could be discussed like the Economic Survey should be a matter for public debate. There are many other issues like the objectives of monetary policy, autonomy of the Bank, etc., brought up from to time. I have suggested in the past that, instead of dealing with them in an ad hoc and piecemeal manner it will be useful to have a high-power committee on the working of the Reserve Bank of India that will inter aliaprepare a new law to replace the Reserve Bank of India Act 1934 after examining all the issues and keeping in mind trends in central banking in the new century. The thinking on central banking has undergone marked changes ever since the RBI Act was passed. In the last quarter century many central banks of both the developing (eg. The Philippines) and the developed (eg. New Zealand) countries have enacted legislation to replace the existing Acts on the central bank. It is time for the new government in New Delhi to consider the matter on a priority basis.
- A.Seshan, Economic Consultant,
{Former Officer-in-Charge, Department of
Economic Analysis and Policy,
Reserve Bank of India, and
(IMF) Adviser to National Bank of Kyrgyzstan and
Bank of Sierra Leone}
Rajan responded with monetary policy panel on interest rates
........ Reserve Bank of India Governor went along with the unanimous recommendation of the members of its monetary policy panel to maintain status quo on interest rates in the Monetary Policy Statement for 2014-15. The eleven member Technical Advisory Committee (TAC), which is headed by Governor Raghuram Rajan, on monetary policy said upside risks to headline inflation in the near term provide the rationale for a pause............
NABARD retirees tired...........
My View on "Pension updation?? Its Divide & Rule........":
In the case of NABARD pensioners GOI is behaving more heartlessly. Even the revision in family pension allowed to RBI pensioners is not allowed although the requirement of the GOI have been satisfied by the Bank, such as Board approval for statutorization of the Staff Rules which the GOI put as condition precedent. Even the Pension Regulations amendments as required by the GOI which have been approved by the NABARD Board and sent to the GOI and RBI are not approved till now. The plight of the pensioners who had retired prior to 1997 is much more pitiable. God knows when the GOI and its bureaucrats will wake up to the hardships of the pensioners of NABARD and extend relief.
- M V Gupta. Principal Legal Advisor (Retd) NABARD, Mumbai
PR & PU periodicity should be the same
My View on Pension updation?? Its Divide & Rule........
Dear Mangesh,
Pension Upgradation—Issues
Shri B.Kamath, my very good friend, is pained by the delay in giving effect to the approval in principle given by the Ministry on the captioned issue. He is fully justified in his reaction and many of the retired officers share his anguish. As Shri Kamath sees it, the delay is a result of the “Divide and Rule Policy” of the Ministry of Finance. So far as linking the issue of “rationalisation of perks” of the serving employees with the Pension Option and Updation issues, this criticism would be justified. Perquisites of serving employees have nothing to do with the issues under hand and hence Governor, with all the authority under his command, would do well to reject this part of the proposal with the contempt it deserves.
Let us come to the issues of the periodicity of pension updation and reckoning of ‘pay’ for updation (or revision as GOI calls it). The concept of pension updation, if I am correct, was introduced only in the 5th Pay Commission (perhaps improved further in the 6th Pay Commission) and hence, if we demand it, justifiably on the ground that our Scheme is on the lines of the GOI Pension Scheme, then the rules relating to fixation of ‘pay’ have to be on the lines of one prevailing in the GOI. In my view, if we insist that pay revision would have to be as hitherto, viz. once in 5 years, then the updation has also to be along with the pay revision. Otherwise, it would not be possible to ensure that all those who have retired from the same grade draw the same pension regardless of the date of their retirement. Let me give an example. My wife retired in the grade of CGM in July 2004 and she got the benefit of the pay revision with effect from November 2002. (I had retired in October 2000 in a grade higher but my pension is lesser than hers!) If another officer in the same grade as that of my wife had retired, say, after November 2007 with the benefit of pay revision given effect to from November 2007, his/her pension would be higher than the pension of my wife unless pension updation has been done along with pay revision in 2007. I am not sure whether it would be realistic for us to expect that pension updation has to be agreed in our case once in 5 years because our pay revision is once in 5 years.
I would not want any benefit given to the serving employees to be taken away for the sake of retired employees and it is also not my intention to deprive them of any benefits for the sake of expeditious settlement of the pension updation issue. It is for this reason that I have said that the linking of rationalization of perquisites of serving employees with the pension issues has to be rejected. It is only because that pay revision and pension updation cannot, in my opinion, be delinked, we may have to agree that the periodicity of pay revision has also to be the same as that of pension updation.
I would request those who have more knowledge in this area to enlighten the readers of MT’s Newsletter.
- A.Chandramouliswaran
Denying level playing field
My View on "‘RBI should be accountable to Parliament’ - Dr.K.C...":
Preamble of the Reserve Bank of India Act, 1934 had inter alia stated: “…but whereas it is expedient to make temporary provision on the basis of the existing monetary system, and to leave the question of the monetary standard best suited to India to be considered when the international monetary position has become sufficiently clear and stable to make it possible to frame permanent measures;
It is hereby enacted as follows:-“
The opportunity for the review envisaged actually came when GOI appointed the Financial Sector Legislative Reforms Commission (FSLRC) which submitted its report sometime back. The plethora of issues considered by the FSLRC did not allow the Commission to focus on the kind of change envisaged in the preamble of the RBI Act. The ‘cut & paste’ FSLRC report which imported ideas not necessarily suitable in the Indian context, instead of trying to build on the strength of RBI attempted to re-invent a new institutional structure. It is not the lack of RBI’s allegiance to legislative supremacy that is at the root of the present friction between GOI and RBI. The assertion of ‘ownership rights’ by lower level functionaries of GOI over all public sector organisations including statutory bodies like RBI and their interference in the legitimate functioning of institutions even in HR issues deny the top managements of these institutions a level playing field with their counterparts elsewhere.
- M.G.Warrier
Portfolios of EDs
...........Sources in the central bank indicate, both seniority and merit was considered by making the appointments. The central bank has nine executive directors, and one of them S Karuppasamy, retired recently. R Gandhi, who was executive director, has now been promoted to deputy governor. Also, .......
Read - BS
Shri DK Mohanty
Read - BS
Shri DK Mohanty
1.Department
of Economic & Policy Research
2.
Department of Statistics & Information Management
3.
Monetary Policy Department
4.
Secretary's Department
5.
Financial Stability Unit
Shri
P. Vijaya Bhaskar
1.
Department of Non-Banking Supervision
2.
Financial Markets Department
3.
Department of Communication
4.
Risk Monitoring Department
Shri
B. Mahapatra
1.
Department of Banking Operations & Development
2.
Department of Government & Bank Accounts
3.
Inspection Department
Shri
G. Padmanabhan
1.Department
of Information Technology
2.
Department of Payment & Settlement Systems
3.
Foreign Exchange Department
4.
Department of External Investments & Operations
Shri
Jasbir Singh
Deposit
Insurance and Credit Guarantee Corporation
Dr
(Smt.) Deepali Pant Joshi
1.
Customer Service Department
2.
Rural Planning and Credit Department
3.
Right to Information Act (also First Appellate
Authority)
Shri
N S Vishwanathan
1.
Department of Expenditure & Budgetary Control
2.
Urban Banks Department
3.
Legal department
4.
Alternate Appellate Authority (under RIA)
Shri
U S Paliwal
1.Department
of Currency Management
2.Premises
Department
3.Human
Resource Management Department
(including
Rajbhasha)
Shri
Chandan Sinha
1.
Internal Debt Management Department
2.
Department of Banking Supervision
3.
Central Security Cell
City Rife with Counterfeit Currency Notes
........Officials say that the fake notes being circulated in the city come through outsiders who reach the state for jobs and other business activities. Migrant labourers, truck drivers and interstate businessmen coming to the city are suspected to be the links of the counterfeit notes mafia. In majority of the cases, the arrested persons hail from West Bengal, which is notorious for many counterfeit note printing units..........
Inflow of fake currency rises in election time
.......The 40-page RBI working paper authored by Sanjay Bose and Abhiman Das have pointed to 3.90 lakh counterfeit currency notes detected in the banking system annually on an aggregate basis over a five-year period, 2007-12. This translates to about seven fake notes for every one million currency notes in circulation. It is lesser than the IB assessment but is based on a scientific study done by the two authors for RBI’s department of economic and policy research. But, the report concedes that there has been a steady increase in FICN in higher denominations of Rs 1,000 and Rs 500. .........
Withdrawal of gold import curbs to be calibrated: Mayaram
Curbs on gold imports in India will not be withdrawn immediately, but will be done in a calibrated manner, economic affairs secretary Arvind Mayaram said on Friday.........
L&T Fin seeks RBI nod to buy promoter stake in Yes Bank
................“If the bank is issuing shares, it will be done with full public disclosure,” Monga had said earlier this week. If the stake buy goes through, this would be the first deal where an NBFC would be acquiring a bank in India. Earlier in 2004, RBI had allowed IndusInd Bank to acquire Ashok Leyland Finance business.........
Top-3 pvt banks live up to expectations
Notwithstanding a tough macro economic environment, leading private banks ICICI, HDFC and Axis put up resilient growth in the March quarter. While Axis Bank’s profits were ahead of estimates, those of ICICI Bank and HDFC Bank was in line with expectations..........
Friday, April 25, 2014
Raghuram Rajan votes
 |
| Reserve Bank Governor Raghuram Rajan voted at a booth near his official residence off Peddar Road in south Mumbai |
Granting licences to corporate sector tricky affair: KC Chakrabarty
 |
| Deputy Governor’s job is less challenging than the CMD of a bank |
............ Distribution of currency/coins is a big issue. This is because we have left it to the RBI and banks. The RBI focuses more on distribution, as a result they are unable to monitor whether banks are doing it or not. The view of the government- constituted high level committee on currency management, which I chaired, is that, we must use the private parties (franchise model) for distribution. We have already done it for foreign exchange which has worked well................
‘RBI should be accountable to Parliament’ - Dr.K.C.Chakrabarty
.......Ultimately, the central bank is created by the government … by Parliament. How can I say we will be a separate country? We are not talking about independence, it is about autonomy and I don’t think that is a big issue. Today, we have more autonomy and we have less accountability. Ideally, the central bank should be accountable to Parliament. .............
Read - TOI
If NPAs are high, everybody is responsible: K.C. Chakrabarty
.....f you are bringing somebody from commercial banking, what should be his appropriate role? In fact, somebody must find out why a commercial banker was brought to RBI. When the Board for Financial Supervision (BFS) was created, at that time there was a parliamentary committee which had gone into the securities scam. You read the recommendations of the committee and see what reply RBI gave.* If Reserve Bank does not stick to its own commitment to Parliament, what can I say? Personally for me, it has been a great learning experience. RBI has been very fair to me; it may not be fair to the banking system................
My contrarian views have been vindicated: Chakrabarty
......"Being open and transparent is the hallmark of democracy. As a supervisor, my job is to communicate and shout, create the awareness. (Sooner) you do that, you will get a better result and more you delay, to that extent will be the damage. That is why I am happy about my stint in RBI," ...........
Rollout of ₹10 plastic notes hits technical hurdle: RBI’s Chakrabarty
.............To improve last mile connectivity, the RBI has decided to involve private entrepreneurs in the distribution function. The cash-in-transit companies/ business correspondents have been allowed to process coins and banknotes, including packaging, sorting and delivery to banks’ customers and for retrieval. Banks, including urban co-operative banks and regional rural banks, are also being involved to ensure that last mile delivery of cash-related services penetrates throughout the country. Chakrabarty said the RBI has also initiated a pilot exercise under..........
Inclusion indecisiveness
.........It is somewhat surprising, then, that a road map for implementing the key recommendations of the Mor committee is yet to be outlined. Although hesitancy over this causing the delay has been denied, the fact that the last monetary policy announcement on April 1 did not specifically mention any plans to implement the recommendations lends some credence to the concern. Considering the importance that Governor Raghuram Rajan attaches to the agenda, one of the five pillars on which he is building his financial stability and development strategy, there were expectations of a big push based on the report. However, what seems to have come in the way are reservations..........
BJP will eliminate discretion: Arun Jaitley
..........Asked to comment on speculation that there might be a change of guard at the Reserve Bank of India, Jaitley said, "We are not getting into issues relating to persons. I don't think we have reached that stage at all."......
Start saving in banks: RBI to students
SHILLONG, April 23: Reserve Bank of India (RBI) Deputy General Manager T. Lhundim has stressed on the necessity of inculcating the habit of saving in the banks among the students community of the country. “Students are the future generation of our country so it is very important that we educate them about the importance of developing good financial habit,” Lhundim said. He was addressing the gathering at the Financial Literacy Campaign programme organized by RBI at Tpep-pale Secondary School, Jowai, on Wednesday.
Worth trying scrap gold
My View on "RBI restrictions hit gold flow to Bangalore":
The issues raised here are very relevant. The inherent fear to touch or talk about the huge domestic stock of gold in India is behind the artificial scarcity of the yellow metal and all concomitant problems like smuggling, unrealistic pricing and so on. The fear of gold was captured by K U B Rao in his report on Gold Management released in January, 2013 in the following words:
“Indians’ obsession for large investment in physical gold is the outcome of the confluence of numerous and divergent factors. Given the complexities involved in the lure for gold in India, a holistic strategy that deploys a combination of demand reduction measures, supply management measures and measures to increase monetisation of idle gold stocks needs to be put in place. Creation of an alternative asset class that may provide returns comparable to return on investment in physical gold with similar flexibility is important. A necessary pre-condition for reducing the excessive demand for the precious metal is to ensure benign inflationary environment along with achieving and maintaining macroeconomic stability.”
If there is a will, there should be some way, to exploit productively at least a small portion of the domestic stock of gold which will minimise the need for gold import. There is no escape from standardising a major portion of non-jewellery surface gold and making it available for productive purposes. When every other asset can be accounted, government cannot be apologetic only about gold. Establishment of the Bullion Corporation of India proposed by the Working Group can play a major role in recycling and pooling of domestic scrap gold. In this context, the Committee’s following observation is relevant:
“Temples in India holds large quantities of gold jewellery offered by devotees to the deities. There is also significant amount of scrap gold in the country. Some estimates say that scrap gold that comes into the system is nearly 300 tonnes per annum. It would be worth trying to channel the existing supplies of scrap gold in the country into the financial system, so that the unproductive nature of the gold asset is turned into a financially-productive medium.”
- M G WARRIER, Thiruvananthapuram
Pension updation?? Its Divide & Rule........
Dear Mangesh,
I am writing this out of deep anguish and acute frustration. When the British left India in 1947, the Indian politicians inherited their most lethal weapon, i.e. the divide and rule policy. We thought that our decade long wait for justice by way of pension upgradation finally ended when the GOI allegedly conveyed its "in principle" approval. But, alas it was not to be. By putting conditions such as revision once in ten years, excluding certain allowances from purview of pension and rationalisation of perks, GOI has driven a wedge between the serving and retired officers. Like the Kashmir issue and river water sharing disputes between two neighbouring states, the cleavage of interests between aforesaid classes defies any imminent solution.The result is that those of us who are on the wrong side of seventies will soon end up as items in the Obituary Columns of VITALINFO and/or Without Reserve and oblivion without realising our dream of drawing a decent pension that we deserve.
- B. Kamath, Retd. CGM
RBI v/s GOI pay comaprision
"Discrimination amongst retirees neither just
nor equitable"
In continuation of my comments
posted in VITALINFO on 23-04-2014 :
The position of pay inclusive of all allowances at the minimum (appxly) and at the maximum (appxly) in respect of Grade B and above in RBI vis a vis in GOI (not exact-but-comparable ) is furnished below ................. - R.G.Nakhate |
Ill conceived Government direction
My View on "Need to move an Interlocutory Application":
Points raised by Shri Batki and Shri Parab are Valued points. The pension to RBI Pensioners is to be paid from the pension fund raised from the contribution of the RBI Employees and NOT from the Consolidated Fund of India. As such, imposing of any conditionals by Finance Ministry are not reasonable on any ground and also do not provide natural justice to Pensioners. The Writ Petitioners may like to approach and raise their objections in Bombay High Court stating that the Speaking Order of The Government and the current Guide lines (conditionals) to RBI are contrary and need to be quashed.The pension Updation is to be allowed in the light of recent Supreme Court Judgments and RBI / Govt. to be directed not to make a different category within the pensioners contrary to law. An early hearing by High Court is necessary as many senior citizen are affected by this ill conceived Government direction to RBI by linking to pay revisions / modernization of the allowances of RBI Officers though these allowances are not paid to the pensioners.
- Capt. C B Gupta
NPS doors opened for people above 60 taking up govt jobs
........“Keeping in view the difficulties being faced by subscribers, the authority has now decided to enrol all eligible government employees into NPS, irrespective of the age at the time of entry, subject to the condition that the total period of contribution to the NPS account shall not be more than 42 years,” .........
A new economic agenda
........The Indian financial system also suffers from a hangover of cronyism and corruption which has left government budgets on the verge of bankruptcy. This too needs fixing. It cannot be rectified by a Reserve Bank of India vitiating the investment climate with an obsession to contain inflationary pressure. It is like killing a patient to lower his body temperature..........
IFC, partners focus on e-payment systems for India’s low-income households
........Addressing the workshop on future challenges, Vijay Chugh, Chief General Manager in the Department of Payment and Settlement Systems, said, “There is an urgent need for all stakeholders to collaborate to enable access to an efficient payment system for the unbanked and under-banked population at an affordable cost. This is envisaged in the Reserve Bank's vision statement.”........
Bandhan to appoint consultants for banking foray soon
....."We are talking to various consultancy firms like KPMG, BCG, McKinsey and Ernst & Young, among others, for appointing a consultant. We will shortly give a mandate to one of them," ........
Forensic audit no solution to unearth the facts
...........The RBI mandates a failsafe warning mechanism to effectively monitor bad loans by putting in place appropriate flagging indicators. Already in place are a plethora of checks and balances from bottom to top for reporting on shortfalls in securities, exceeding drawing powers, day-to-day on-line reporting requirements, ratification requests...............
Gujarat HC Restores RBI's Power to Decide NPA Period
........"Section 2(1)(o) of Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act is held unconstitutional," the bench of Chief Justice Bhaskar Bhattachrya and Justice J B Pardiwala said. The High Court also observed that the Parliament was wrong in taking the power to decide NPA guidelines away from RBI. Before the amendment in 2004 to the Act, RBI was the regulator for the banking, non-banking institutions and securitization agencies for deciding the period after which the loans can be treated as NPA. Till 2004, RBI had set the NPA period for banks at 90 days, and at 180 days for NBFCs.........
Minus JKB and HDFC, banks miser at lending in JK
Srinagar, Apr 24: Not only the nationalized banks operating in J&K are conservative in lending but performance of most private sector banks in providing loans in the State is even worse.
A cursory look at the performance of banks reveals that these banks are accumulating huge deposits in the state while their contribution to the credit portfolio in the state is negligible........
Read - Greater Kashmir
A cursory look at the performance of banks reveals that these banks are accumulating huge deposits in the state while their contribution to the credit portfolio in the state is negligible........
Read - Greater Kashmir
IndusInd Bank to foray into asset reconstruction
........."I think our new initiative, which is going to launch in the next two months, is about asset reconstruction. We will do asset reconstruction within the bank but in tie-ups with ARCs. The business plan is ready. We believe a huge stock of assets is coming into the ARCs as a business area that we need to look at and we will exploit," ........
Markets await revamped IIBs from Reserve Bank
.......“The poor appetite is mainly because it is not transferable, that is, it cannot be traded in the secondary market and premature redemption is allowed only after three years with a penalty,” Mr. Khurana added. It will be difficult to quantify the exact demand for the product, but with the gross borrowing programme at Rs.6 lakh crore (approximately), “this could catch the interest of investors provided there is sizable liquidity created through continuous issuances”.............
Yes Bank appoints two new directors amid legal case
.......The new directors have been appointed “in accordance with extant Reserve Bank of India (RBI) regulations and the New Companies Act 2013”, the bank said in a statement. It also announced the formation of two new committees, IT strategy and CSR (corporate social responsibility), as mandated by the new companies law. Yes Bank is one of the respondents in a case filed in the Bombay high court by Madhu Kapur, wife of late co-founder Ashok Kapur, demanding the right to nominate directors to the bank’s board..........
Thursday, April 24, 2014
Cheers and challenges for Raghuram Rajan - A.Vasudevan
.........Financial stability is the foundation on which central banking is based. With non-performing assets of banks on the rise at present in India and with uncertainties about the durability of the economic revival of industrialized economies, it is important that RBI makes it a point to provide the rationale for moving towards inflation targeting at this juncture. RBI should also provide an idea about the nature and quantum of its accountability for....................
Well prepared for a ‘consensus’ approach
My View on "RBI Guv Could Be at the Centre of New Order":
This discussion serves one-perhaps only one- purpose. It gives an opportunity to those who are not generally RBI-watchers and to those who are really serious about understanding the ‘equation’ between RBI Governor and the finance ministry to ponder deeper. Suffice to say that the debate may not affect the continuity at Mint Road or more specifically the broad policy perspectives of RBI. In retrospect- as one who had argued that, in the circumstances that prevailed in July 2013, it was in the fitness of things to allow another year’s extension for Dr Subbarao- it seems the decision to shift Dr Raghuram Rajan in August-September 2013 to Mint Road was right and has served the purpose of having at least one person at the top who can take charge of the leadership in the Indian Economy when most others were unsure about their own survival. Dr Rajan who has been doing his homework for the position that was waiting for him, is by now well prepared to ensure a ‘consensus’ approach in policy matters where he has a say. This is evident first from the chapter “Afterword: What Lies Ahead for India” he added to his book Fault Lines during the early years of this decade read together with his recent speeches and observations.
- M.G.Warrier
Conference of Risk Officers
 |
Conference for Risk Officers
|
North Zone ROs at New Delhi (Feb.
18-19)
West Zone ROs at Ahmedabad (March 18-19)
East Zone ROs at Kolkata (March
24-25)
South Zone ROs at Bangalore (March 27-28)
CoDs at Belapur, Navi Mumbai (April 21-22)
ED (PVB) stressed the need for continuous efforts on part of all the
CoDs/ROs and TEs for fostering risk management culture in the Bank. ED mentioned
the background and genesis of RMD in the Bank and the importance given to ERM
framework globally in other Central Banks particularly in the aftermath of the global-financial
crisis. ED emphasized that each and every employee of the Bank should try to identify
and mitigate the risks in his day to day working in the Bank. He emphasized the
need for being particularly sensitive to aspects which had any implications for
Reputation Risk. He also stressed the need for effective communication on risk
related matters at every level of hierarchy which will help in developing a
risk culture in the Bank. ED urged the Risk Officers to identify the unique
risks faced by their respective Departments/Offices.
CGM, RMD (Shri M. Rajeshwar Rao) in his address outlined the ERM
framework of the Bank and the major developments in this area since the
inception of the department. He also delineated the roles and responsibilities
of all stakeholders, including Risk Officers especially with regard to
preparation of Risk Registers.
Sessions on Risk Assessment Methodology for Operational Risks, Framework
for Incident reporting and preparation of Risk Registers were conducted during
the conferences. The discussions were followed by hands on sessions on the applications
developed for preparing Incident reporting and Risk Registers. The participants
were also familiarized about the rationale and methodology for generating heat
maps based on risk registers. All the sessions were interactive and participants actively shared
their views on risk management and expressed their willingness and confidence
in taking the process of risk management forward in the Bank.
The witticisms of K.C. Chakrabarty
When K.C. Chakrabarty moved from the chairmanship of Punjab National Bank (PNB) to the deputy governor’s position at Reserve Bank of India (RBI), the fraternity of bank analysts was deeply disappointed. We just wondered who in the sector will entertain us. After all, there are few bankers who are great entertainers. And a banking regulator by definition will be even less of an entertainer. But Chakrabarty did not fail us. His indomitable spirit sustained the rough and tumble of central banking, and...............
Interesting situation
My View on "Discrimination amongst retirees neither just nor e...":
1. A very interesting situation has arisen in RBI Pension updation field. Pension in RBI came into force w.e.f.01 November 1990 under RBI Pension regulation, 1990. This RBI Pension Regulation is being replaced for new entrants and shall cease to be from 1 January 2012 for NPS. That means the present pension regulations will be implementable to employees who worked in RBI during these 22 years. As the New pension Scheme (NPS) is started in RBI from 01 January 2012 on wards.I do not know whether the RBI Pension Regulation, 1990 Chapter 1. Reg. 1. (2) has been amended by the Bank for it's discontinuing to new entrants.Or, a new RBI Pension Regulation has been incorporated with parliament approval for new entrants w.e.f. 01 January 2012, the RBI Legal department will be the best to know this.
2. As far as the existing Pensioners under RBI Pension Regulations, 1990; one thing is clear that" Neither the pension can be reduced nor withdrawn by any Government Order without a judicial pronouncement." So, the Pension and DR received is assured for the entire future of the Pensioner. As regards Updation, the Bank to consider how best it can pay pension to the all equally at the same length and scale of pay with out making a different category among the pensioners against the law explained by Hon. Supreme Court in their various judgments chiefly Nakara Case.
3. Therefore, Bank is required to Pay Pension to an equal amount to Pensioners on each pay revisions at the same level ensuring no junior gets more pension at any point of time during the currency of RBI Pension Regulation, 1990 and that is called - - - Pension Updation.
4. It can be very easily be paid either merging all the superannuation elements in Basic Pay or the Grade Pay. Since, RBI Scales and positions are on different pattern, the Grade pay may be considered an additional allowance as paid with salary in Private Sector as a separate nomenclature.
This solution will solve RBI Pension Updation issues without any problem. United Forum may consider it as one of their avenue along with other alternatives also.
- Capt. C B Gupta
When we ask for updation of pension as in the case govt. pensioners, govt. says as updation is given along with wage settlement, once in 10 years only in govt. RBI may similarly extend the benefits,once in 10 years. Of course, in Banking industry wage revision is once in 5 years only.
We may therefore propose wage revision be continued as hitherto before,that is once in 5 years, and the updation given once in 10 years. GOI may also agree. In fact the first pension updation given in 2003 by RBI is on the basis of two 5 year wage settlements of 1992 and 1997 only. RBI may follow the same in future. The serving staff may understand that by the denial of updation to the 10000 pensioners, like us, for the last 10 years, each one of us lost about a lakh of rupees on an average per year, that is total loss is more than 10 lakhs,per pensioner. This non-stop deprivation has to be put an end to, before the aged pensioners bid farewell to this world. The Serving Staff have to give a helping hand, as whatever little loss of new perks of 2007 wage settlement, will be insignificant considering the overall picture, as that loss could also be recouped later by negotiation.
- Sendil
What it takes for a man to plunge into marriage & what of those who don't
Marriage is for the brave. For those with deep conviction. Married men make for better marathon runners at least in Bombay. Marriage is for those who can play the stock market even if Raghuram Rajan is not helming the Reserve Bank of India. Married men are believers and almost always deeply religious and wife fearing. They have .........
RBI panel moots centralised bill payment system
.........The report further said the standard setting role/ function has to be distinct from the operational aspects of the bill payments system. "It is, therefore, recommended that the bill payments system follow a 'tiered structure' - the standard setting functions being carried out by a central body / agency (to be named as Bharat Bill Payment System - BBPS) with actual operations being carried out by multiple entities,".........
Get ready for digital signatures
..........The roll out of digital signatures will also depend on how quickly customers adapt to it. “There is a recommendation to make it easy for customers to get a digital signature. That’s why possibly a period of 18 months is given,” said Deepak Sharma, executive vice-president and head-digital initiatives, Kotak Mahindra Bank Ltd. He added that the move will be good for customers, as they will..........
10-15% cards used only for online transactions: RBI report
..........."Credit cards have a higher share in the discretionary category whereas debit cards dominate in routine expenses like utility payments. About 30% of credit card spends are being done online. At least 10-15% of customers use their cards only online, many from smaller cities," the.........
RBI constrained to withdraw 75% of banknotes each year
........Such massive withdrawal of banknotes from circulation not only means additional cost for printing of fresh notes but also additional requirement of various resources used in production of banknotes. In this context, it becomes imperative that efforts are made to enhance the durability of the banknotes so that not only the wastages are reduced, but also resources are utilized in a sustainable manner, thereby ensuring that the environmental footprint of our currency management operations is minimized. Mechanization of soiled note processing while augmenting capacity has also thrown up new challenges ...........
Fake notes: RBI warns paper, ink suppliers
..............Calling for cross-border cooperation in regulating suppliers, RBI has warned that it would have to go in for higher indigenization if vendors do not adopt 'know your customer' norms while selling. RBI's tough talk will have an impact in the global market as India is the largest producer of currency notes. With 7,647 crore notes printed every year, India generates more than double the notes printed in US and...............
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