..........They say three great forces rule the world: stupidity, fear, greed. Gold’s crash was triggered by fear. Now, you would be stupid not to become greedy.
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.
Tuesday, April 16, 2013
RBI working on improving on housing finance database
........"The Reserve Bank is also developing a housing asset price monitoring system covering such details as LTV ratio, EMI to income ratio and price to income ratio based on housing loan data from select cities collected from select banks and HFCs." Said Deepak Mohanty, Executive Director, RBI at an international seminar orgainsed by the National Housing Bank last week. .......
Private banks don’t help financial inclusion
......That, of course, means that even if profits are positive, they are much lower than what would be earned if financial inclusion was not an objective. To expect private banks to settle for this lower profit margin and rate is to forget the nature of private incentive. It is only by presuming that private operators will not behave like private operators and have changed character since the 1950s and 1960s that the entry of the corporate sector into banking be seen as an instrument to advance financial inclusion........................
All in the bank
..............Suspicion has been raised from time to time that West Bengal is insufficiently served by banks and that it is the fault of the Central government that owns most banks. Now the Reserve Bank of India has published some statistics relating to bank branches which enable one to derive some crude indicators that can throw light upon the question. West Bengal’s population in 2011 was close to 7.5 per cent of India’s in 2011; the proportion is unlikely to have changed much since. Its gross domestic product in 2011-12 was roughly a 15th or 6.7 per cent; the average Bengali is a bit poorer than an average Indian, but not much ..............
ASSOCHAM favours initially ten new banks
.......... “Considering the uncertainties/volatilities associated with current business environment, RBI may consider giving out licences in a staggered manner to few players in a specific time frame. It could be a process, and not an event..........
M&M Financial Services keen to enter banking space
......Mahindra and Mahindra Group believes that it meets most of the criterion set out by the Reserve Bank of India for bagging a banking licence and is quite excited at the opportunity of floating a bank, said a top official. “We believe we qualify on most of the parameters set out in the guidelines like high credentials of the group and well-run financial services business, which has been profitable all through.......
A solo financial regulator
........ In fact, there should be complete cohesiveness between the Reserve Bank of India, the Securities and Exchange Board of India and the Insurance Regulatory Development Authority..............
Rate cut in May for sure, but how much?
........It’s now fairly certain that the Reserve Bank of India (RBI) will go for a policy rate cut in May to prop up slowing economy, even though RBI governor had said in his last policy that the scope for monetary easing is limited. The question is: will D. Subbarao stick to his ‘baby step’ of a 25 bps rate cut or show boldness by combining it with a cut in banks’ cash reserve ratio (CRR)—the portion of deposits that commercial banks need to keep with RBI—by an identical margin?..........
RBI should take a call on rate cuts: FM
Finance Minister P Chidambaram has again made a pitch for lowering interest rates. Speaking to Business Standard here on Monday, he pointed to the latest inflation numbers to make his case. "Both core inflation and WPI inflation have come down for the month of March, CPI is down to 10.4 per cent, so these are indicators. I think the RBI governor will take note of the fact that core inflation, WPI inflation and CPI inflation have all come down and he will take a call.".........
RBI has leeway for a 50bps repo rate cut
..........Markets should not rule out a 50 basis point (bps) repo rate cut that day, though the RBI had sounded caution on further cuts in its March policy review where it cut the repo rate by 25 bps. At that time, the central bank was worried on food inflation, which was trending at 11.38%, leading to higher consumer price inflation and current account deficit (CAD) hitting record high levels. RBI’s concern on inflation and CAD remains, but indications are that both the measures are likely to trend down, going forward............
BS POLL: 25 bps rate cut buzz gains momentum
............. “We think RBI will support an easing monetary policy bias in the next few months. Consequently, we expect the central bank to cut the repo rate by clips of 25 basis points in the next two policy meetings (May and June),”..........
New law restricts securitisation in MFI
The microfinance industry saw 13% rise in deals involving sale of portfolio through securitisation and other bilateral transactions last financial year. However, the year-end Budget proposal to tax the special purpose vehicle (SPV) involved in the deals held back a number of deals. In addition, the new Reserve Bank of India (RBI) guidelines on securitisation and direct assignment of loan receivables restricted the number of deals...........
Chidambaram should say in US it’s time to invest in the India story
........ For investors, there is no best time to jump into India. Chidambaram should remind the people he meets about Nathan Rothschild's advice to "Buy when there is blood on the streets."
Bank that encourages women entrepreneurs
........In all probability, the bank would be a pleasant reality given the fact that it will receive an initial capital of Rs 1,000 crore. Given that it would be a PSU bank, it would not need to be issued a special license by the RBI. In fact, we have woken to the reality quite late as our neighbour Pakistan already has one, running successfully for the last fourteen years with 38 branches across the country...............
J&K Bank bags Europe Business Assembly award for best enterprise
Jammu and Kashmir Bank, the only listed company of the state, has bagged the prestigious Best Enterprise award from the Europe Business Assembly (EBA) in London, a bank spokesman said on Monday. The spokesman said that the award has come as a strong international recognition for the bank’s enterprising performance in the field of banking and finance.......
SBI in talks with Vodafone for last-mile link to unbanked
The State Bank of India (SBI) is in talks with Vodafone India to make the UK-based telecom company its last-mile agent offering basic banking facilities to unbanked regions in the country, a person familiar with the discussions said.........
Monday, April 15, 2013
The RBI clutches at straws
By extending priority sector target to foreign banks, RBI has displayed a lack of understanding
.........After nearly five decades of regulation over 50 banks with nearly 100,000 bank branches enforced with penalty and policy coercion (banks that don’t meet targets are not given new branch licences) the status of the priority sector is pathetic. A case in point being the 26 million small enterprises. These contribute 17% of the gross domestic product, 45% of manufactured output and employ 60 million people. Yet, credit availability to these enterprises is meagre. In fact, it is less than 10% of aggregate net bank credit..........
Read - Mint
New banking could use some old time culture - DR. N. A. MUJUMDAR
.....What is required today is the same " small borrower friendly" banking culture, unlike profit- making micro finance institutions ( MFIs). Public sector bankers should go beyond profit- making and try to upgrade the enterprises to which they lend - may be for farm or non- farm enterprises - and catapult the borrower into a higher income trajectory. Mere tokenism of making banking services physically accessible will not do. Profitability and social banking need to be blended. Financial inclusion in a meaningful sense thus warrants the same commitment on the part of the bankers, particularly public sectors bankers, that they displayed during the Lead Bank Programme.......
Over 100 aspirants line up for banking licence, seek clarity
RBI has been flooded with requests for interpretation of its rules for grant of new banking licences and for clarifications on the 'ambiguity' in various areas, as more than 100 entities have evinced initial interest in seeking permission to set up banks. RBI released its guidelines for licensing of new banks in February this year, asking the aspirants to submit their applications by July 1, 2013. Later, the central bank asked all the interested parties to seek any clarifications they might have on the issue by April 10, a deadline that ended last week. Sources close to the development said that more than 100 entities appear to be interested in applying for the licence, going by the quantum of clarifications sought from RBI in this regard...........
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