The Karnataka High Court on Thursday ordered issue of notices to the Union government, the Reserve Bank of India and the Amanath Bank on a batch of petitions filed by bank’s depositors seeking permission to withdraw their money.............
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, May 27, 2013
NDCC bank board dissolved superseded, administrator appointed
.........While the state government stated that it had sought permission from the Reserve Bank of India (RBI) for appointing an administrator, the office of the commissioner for cooperation and registration of cooperative societies stated that the report filed by NABARD pointed out serious discrepancies in the working of the bank.........
FM tells banks to gear up for a growing economy
The economy will revive this fiscal, and will grow by one percentage point more than last fiscal, Finance Minister P. Chidambaram said here on Saturday. “In the next year, I expect it to grow by another one per cent (percentage point) more,” Mr. Chidambaram said while inaugurating the new building of Canara Bank................
From financing to funding
..........In addition to this, it is not too well kept a secret that banks are refinancing and restructuring loans. These are currently being done to “evergreen” accounts. As such, much of this is being done in partial or complete violation of the regulatory guidelines. This makes the banking sector very weak and vulnerable. The need is to refinance and restructure in line with the economic cycle and in a constructive manner. In this context, it might be worthwhile for RBI to relook at some of its more stringent and mechanical prudential norms. And instead of focusing too much on interest rate, focus on relaxing some prudential norms but tighten the provisioning policy. Instead, RBI relaxed the provisioning norms..............
Something to cheer about
.........The expected cuts in interest rates as well as the cash reserve ratio (the proportion of deposits that banks have to park with RBI) may finally nudge commercial banks to reduce lending rates, thus, encouraging borrowers to engage in commercial activity (for individuals, this could mean buying a house or car; for businesses, this would mean investing in expansion or buyouts). There are political and policy signals as well. At long last,..........
No tax exemption for inflation-indexed bonds: RBI
........."The new instruments to be issued down the line when perhaps CPI index stabilises, we may move over (to consumer price inflation). But currently, the choice is for WPI inflation for the current series which is going to be issued (on June 4)," Reserve Bank Executive Director R Gandhi said. Gandhi, who oversees the internal debt management department, was speaking during a specially-arranged conference call with market participants to clear doubts surrounding inflation index bonds (IIBs), the first tranche of which is to be issued on June 4. ................
The story behind the bond rally
Bond dealers in Mumbai, India’s financial capital, have started enjoying their Friday evenings once again. Despite a record highRs.5.79 trillion gross government borrowing programme for the current fiscal, bond yields are dropping and wholesale price inflation is declining every month to levels below what analysts expect.............
RBI will take some time to act against banks flouting KYC norms
The Reserve Bank of India may take some time to act against banks violating the know-your-customer (KYC) norms, according to Rajiv Takru, Secretary, Department of Financial Services. “We should not expect any action from the RBI in the next week or 10 days. The Board of Financial Supervision in the RBI has to follow a certain process,” ............
Cash-rich PSUs may team up to launch new-generation bank
With the Reserve Bank of India (RBI) expected to issue banking licences to a host of prospective companies, a fresh licence may be given to a consortium of cash-rich public sector enterprises (PSUs). “The finance ministry is keen that one new bank licence be given in the public sector space to a consortium of say three-four cash-rich PSUs,” a top government official, who did not wish to be identified, told HT...........
'Bank mergers lead to too-big-to-fail entities'
..........Are our regulators well positioned to evaluate the consequences to competition in different sub-markets and across regulatory jurisdictions? Is there a role for the Competition Commission of India (CCI) here? Finally, we have seen bank mergers lead to too-big-to-fail entities. What constitutes a merger too far? How do the relative merits of prudential regulation and competition regulation weigh?.................
Compensate bank customers if they fail to get desired service
.......Though most of the public sector banks did come out with time norms for services like encashment of cheques and issue of drafts and displayed them in their notice boards, these norms were never seriously followed.They remained only on paper, as there was no penalty imposed on banks for non-adherence to these time norms. It is possible for the RBI under its existing powers to stipulate penalties for non-delivery of stipulated services by banks and provide for compensation to the banking public for failure of any bank to honour its commitments to its customers. ......
New bank licences | The contenders
The deadline for applying for a banking licence expires on 1 July. At least two dozen companies, both in the private and public sectors, are busy drawing up plans for their entry into banking, being opened up again a decade after the Reserve Bank of India (RBI) allowed the entry of two new banks. India nationalized 14 large banks in 1969 and another six in 1980. RBI has so far given licences to only a dozen private banks in two phases, including the conversion of a cooperative bank into a commercial bank..........
Merging PSBs won’t help
........The merits of consolidation in the banking space have been discussed often but attempts to merge banks have met with little success, partly because employee unions have resisted the idea. Perhaps the Reserve Bank of India (RBI) will give its perspective on the subject in a paper on that it plans to put out soon. There’s little doubt, however, that many of the smaller public sector banks have been stressed over the past year or so...............
Clip Discretionary Wings of PSB Chiefs, Says CBI
.....A
CBI court recently sentenced a former chairman of Indian Bank to one
year rigorous imprisonment by in a cheating case causing loss to the
bank. The banking sector body, Indian Banks Association, has opposed the
move citing that such measures will impact the bank’s competitiveness. “Discretionary
power is a part of the bank’s financial and managerial autonomy. The
IBA has opposed any such measure,” said an IBA official, requesting
anonymity............
Damodaran committee report on biz climate likely next month
.................SBI Chairman Pratip Chaudhuri, NTPC chief Arup Roy Choudhury, BHEL chief Director B P Rao, representatives from Sebi, Reserve Bank of India and the Ministries of Corporate Affairs, Finance, Power, Petroleum, Highways, Commerce and Industry and Urban Development are also part of the panel. Recently, Corporate Affairs Minister Sachin Pilot had said that he has asked the committee for concise, tangible and actionable suggestions...............
Make ‘basic’ banking services free!
.............The RBI should, therefore, now take up the cause of depositors in right earnest not only in the interest of improving the savings rate in the country, but also with a view to restore the trust of the public and get their patronage before grating new banking licenses, as banks have lost the confidence of the general public due to their callous attitude towards the customers and the recent exposures of unhealthy practices in the functioning of commercial banks in our country.
Online fraud: Why should you not blame banks
........From time to time, the Reserve Bank of India has made it clear that it nerve asks personal bank account details. The central bank has of late, embarked on a series of measure to stop this growing menace to fleece bank customers. "We keep requesting CERT-IN to block the ip addresses from which such mails are sent. But the fraudsters use dynamic ip addresses and therefore blocking of ip addresses is not a very effective way to stop such frauds. Banks have also been asked to post a warning on their websites,"............
Are housing finance companies relevant? - NO
.....Of course, there is hardly any difference in the regulatory powers vested in RBI and NHB, which narrows the scope for regulatory arbitrage. With regard to interest rate and prudential regulations when RBI issues some guidelines, the NHB follows suit, or at times takes the lead like in waiver of prepayment penalty on home loans. In this case, the NHB moved first and then the RBI issued its notification asking banks to waive prepayment penalty.............
Are housing finance companies relevant? - YES
.........Despite debate on the differences between banks and HFCs and the need to have a separate regulatory regime for the latter, there is compelling rationale for dedicated housing finance companies.HFCs are governed by the NHB while banks are regulated by the RBI. The NHB is a sub-regulator of the RBI, specifically created for overseeing HFCs. All the regulatory changes seen on home loans have emanated from the NHB and have later been replicated by the RBI............
‘Gujarat’s is an example of balanced growth’
.......Among the other feathers in his cap are being a member of the Reserve Bank of India Western Area Board, a member of the Competition Commission of India, and holding positions on the boards of a number of public and private sector companies. At present, he is Director with Adani Institute of Infrastructure Management and Adani Institute of Medical Sciences.............
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