......“The committee will urge the government/ Reserve Bank of India to constitute a special NPA management cell at the highest level to review the write off, up-gradation and restructured advances and also to monitor the pace of recovery of NPAs. A report on results achieved thereof may be submitted to the committee within three months from presentation of this report,............
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 23, 2013
Bond spreads might remain at current levels till RBI monetary review
.......However, the 10-year bond spread is expected to remain at current levels. Bond spread refers to the difference between the yields of two bonds. Few companies have tapped the domestic bond market but most await RBI’s monetary policy announcement on May 3. If the apex bank cuts the repo rate, the coupon rates of corporate bonds will drop.........
Parl Panel for opening branches in unbanked areas
......."The Committee in their earlier reports had expressed their view that the rural branches should be considered as a service centre and not merely as a profit centre," Standing Committee on Finance said in a report tabled in Parliament today. "With this perspective in view, the Committee believe that the proposition of brick & mortar branches in sparsely and unbanked areas would still be sustainable in the longer run and thus needs to be pursued earnestly," it said.........
‘Focus on low-cost deposits, advances for growth’
......... in this era of keen competition when the banking industry growth rate is moderate, the quality of service and assets scores over quantity. The strength of an organisation lies in effective management of assets. Both staff and customers are critical to the growth and development in the banking sector,...............
Banks’ liquidity issues
This refers to your editorial “More freedom for cash” (Business Line, April 22). If at all banks face any liquidity crunch, it is of their own making and the RBI cannot be expected to come to their rescue. Banks in India face a liquidity crunch because of poor mobilisation of deposits thanks to poor customer service, high inflation, and reluctance to cash in on financial inclusion as a business opportunity. The way banks function now, with 78 per cent CD ratio when there is not much of demand for fresh credit, is indicative of a serious deficiency in asset-liability management. The NPA deposit ratio needs to be analysed in detail. The banking system has been having liquidity problem for quite some time and the solution for that cannot be relaxing the regulatory measures of the RBI.
T.V.Gopalakrishnan (HBL)
Bulls on a strong footing
........The second and more important trigger was the decline in the inflation numbers released last week. This sharp drop in the rate of inflation has increased hope that the Reserve Bank of India (RBI) will be more aggressive in cutting policy rates this time around. That was the primary reason behind the short covering in bank Nifty — which was on the forefront of correction for the past two months — and banking stocks were the main contributors to the rise of Nifty last week..........
Too early for optimism on trade balance
The recent fall in commodity prices might not be sufficient to bring down the country's widening current account deficit (CAD). Experts say more is needed for a significant change in this regard. The Reserve Bank of India (RBI) views the high CAD as a key challenge. RBI Governor D Subbarao said earlier this month that the CAD for the financial year which ended on March 31 was unlikely to be less than five per cent of gross domestic product (GDP).......
Regional rural banks may be allowed to tap private capital
.....The Bill, introduced by Finance Minister P. Chidambaram in the Lok Sabha on Monday, aims to amend the Regional Rural Banks Act 1976. One of the proposed amendments seeks “to make provisions for raising capital by regional rural banks from sources other than the Central Government, the State Government and the sponsor bank.” However, there is one condition — in no event should the combined shareholding of the Central Government and the sponsor bank go below 51 per cent.......
Crack the exam, select your posting
If clearing a bank exam is good enough, imagine being offered a chance to indicate your order of preference — of both the bank and the State/Union Territory you would like to work in. The Institute of Banking Personnel Selection (IBPS), the autonomous body which is in charge of conducting the Common Written Test on behalf of the participating organisations (the banks), has sent a communication to this effect to those who have cleared the CWE for clerical cadre...............
In unchartered territory
The Reserve Bank of India is expected to soon announce the final operative guidelines for non-banking financial companies (NBFCs). An RBI-constituted panel, headed by its former deputy governor Usha Thorat, recommended tightening of rules for NBFCs, proposing that these companies should have minimum assets of Rs 25 crore. Thorat has also suggested that their minimum equity capital be raised to 10 per cent of risk-weighted assets from 7.5 per cent currently. The panel released its recommendations on December 12, 2012. However, the RBI is not trying to finalise operational guidelines based on these recommendations..............
Tides turning for Islamic banking in India?
.....“However, once the Microfinance Bill is enacted, all the microfinance activities will come under RBI and problems will surface again. Issuing of Islamic bonds – sukuk – may be made possible, though, with minor changes in the rules without making major changes in the laws,” .........
Islamic microfinance market size reaches $1b, says Pakistan body
....... if one takes an overview of the last 10 years of the Islamic finance industry, it can be observed that with the passage of time Islamic banking, Sukkuk, Takaful and Islamic fund, have progressed quickly. In the next three years Islamic microfinance will progress more quickly relative to other Islamic financial products,............
Muthoot FinCorp’s microfinance arm expanding into 2 more States
......The company, which has also applied for a name change, expects to get the NBFC-MFI approval from the RBI in three-four months. Since there is a margin cap of 10-12 per cent on the interest rate that an NBFC-MFI can charge above the bank lending rate, customers will benefit if the company gets the NBFC-MFI recognition..........
RBI earns over 40% returns from its gold reserves
MUMBAI: The Reserve Bank of India is sitting on handsome returns on its gold reserves despite the recent crash in the yellow metal's price. The RBI's gold stock of about 400 tonnes, currently valued at $25.7
billion, has appreciated 41% since it bought 200 tonnes in
October-November 2009 from the International Monetary Fund...........
Industry body recommends cut in gold's LTV ratio
KOCHI: Association of Gold Loan Companies (AGLOC) on Monday recommended a reduction in Loan-To-Value (LTV) ratio of gold in the background of recent crash in the price of the metal. "We have asked our members to conform to the 60% LTV ratio stipulated by the Reserve Bank of India, said by George Alexander Muthoot, president of AGLOC and the MD of Kochi-based Muthoot Group.............
Pilot writes to state CMs for police action in fraud schemes
In a multi-pronged strategy to deal with the menace of fraudulent chit funds and ponzi schemes, the Centre has written to state chief ministers for vigorous police action against erring entities and has also sought an increased surveillance by the RBI. Besides, the Corporate Affairs Ministry has also decided to spread public awareness about such schemes through bulk SMSs, TV tickers and messages on Post Office Passbooks, while a joint campaign is being explored with Sebi as well. ...............
Centre assures state of new warning system
....... "Other than the regulatory bodies like the Reserve Bank of India (RBI) and the Securities and Exchange Board of India (Sebi), the ministry of corporate affairs and the state government, henceforth, will interact directly so that operators can't take advantage of the gap between the multiple agencies,"..............
Mamata sets up panel to probe chit fund scam
.......“Any commission set up by the State government in its terms of reference has the jurisdiction to inquire into matters listed in the State List of the Constitution. In this instance, there are Central agencies like the Securities and Exchange Board of India and the Reserve Bank of India involved and a commission set up by the State government cannot investigate their role,” ....
India currency futures stifled by central bank rules: MCX-SX
Indian currency futures volumes have been stifled by the RBI move last year to prevent rupee weakness which has indirectly created prices variations between listed and over-the-counter derivatives, a senior official at domestic exchange MCX-SX told Reuters.............
Monday, April 22, 2013
Pathways to obsolescence - Dr.Subir Gokarn
.....Organisations succeed and grow because they figure out how to do a few things very well. These things - products or services, with all the attendant processes - then expectedly tend to crowd out everything else they do. People move up the ladder because they have been associated with successful activities. Over a period of time, the top leadership comprises exclusively people who have all come up in exactly this fashion. The focus of the organisation on these activities and the reward and recognition systems tied to them gradually leads to the disappearance of everybody who has other interests or perspectives, particularly from the top leadership......
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