.............."When fully rolled out, I believe it will give the poor the choice and respect as well as the services they had to beg for in the past," Rajan said, adding that financial inclusion will be an important part of government's and Reserve Bank's plans for the coming years. .......
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, August 12, 2014
No differences with government on financial inclusion, says Raghuram Rajan
................Reserve Bank of India (RBI) governor Raghuram Rajan on Sunday, clarified that there has been no difference of opinion between the government and the banking regulator on the implementation of the ambitious financial inclusion scheme – a pet project of Prime Minister Narendra Modi – likely to be unveiled on August 15. The RBI, however, was not in the favour of an overdraft facility of Rs 5,000 per account........
Higher RBI Dividend may Keep Rates in Check
Reserve Bank of India governor Raghuram Rajan may not have given in to calls of an interest rate cut, but by transferring about Rs. 53,000 crore surplus to the government, up two-thirds from previous year, he may have ensured that rates do not rise. On Monday, the ten-year new benchmark bond yields fell about five basis points to 8.60%, prompting some amount of bullishness. Bond yields and prices move in opposite direction........
Read - ET
Read - ET
Basic suite of products by banks, key to financial inclusion: Rajan
............In order to draw in the poor, he said, the products should address their needs — a safe place to save, a reliable way to send and receive money, a quick way to borrow in times of need or to escape the clutches of the moneylender, easy-to-understand accident, life and health insurance and an avenue to engage in saving for the old age. “The RBI is going to nudge banks to offer a basic suite of products to address financial needs.’’ The RBI Governor said that de-monetisation was often cited as a solution to get black money out of the system, “but the clever find ways around it.’’..........
India’s inflation fight starts in the kitchen
......."India's inflation is structural in nature, stemming largely from supply constraints, especially in food and infrastructure. While monetary policy remains the first line of defense, a lasting solution to India's inflation lies in real sector solutions like improving and expanding infrastructure and getting its food policies right," Duvvuri Subbarao, RBI's former governor, told CNBC..........
Will the new financial inclusion plan work?
..............The second phase of financial inclusion talks about a ‘pension scheme’ to be made available to the identified beneficiaries in the unorganised sector and providing micro-insurance products to them through nationalised insurance companies. So what can be done to make CFIP successful? The government has allowed a number of agencies to operate as BCs like corporate BCs, Kirana shopkeepers and daak sevaks, in addition to individuals/organisations operating as BCs. RBI is planning to allow the proposed small and payment banks to function as BCs. BCAs to be deployed will be ‘sons of the soil’ who can win the trust of the rural people. But the success of the BC model will depend on ...........
PSU banks’ mergers
Once again, rumours of PSU banks getting merged is doing the rounds. This is just a stop-gap tactic of the ministry of finance. PSU bank mergers will not solve the problem of bad loans in banking. Special Debt Recovery Tribunals, Sarfaesi Act, and Assets Reconstruction Companies—all have failed to recover bad loans. This is because banks were on loan-giving sprees for the last 10 years. The mere size of a bank is not important. It is the health of the bank's balance sheet that matters. Merging PSU banks will reduce promotion opportunities to bank executives as top and upper-middle management posts will be reduced. The government will also not be able to accommodate many on bank boards. This rumour looks set to die in few days. - Sudhir Keshav Bhave, Mumbai
Regulate public sector banks
The comments in the editorial “One bad apple?” (August 8) are prejudiced against public sector banks and biased in favour of privatisation. The manner in which you have argued for the implementation of the PJ Nayak Committee’s recommendations makes this clear. The Nayak Committee has recommended repeal of the Bank Nationalisation Act and SBI Act, which is preposterous given the unparalleled contribution of PSBs to the economic development of the country. The banking system was insulated from the recent global financial tsunami only because our banks were predominantly under the public sector. Further, given the present economic scenario of stagflation, PSBs have a great role to play in not only achieving total financial inclusion but catering to the needs of all segments of the economy. You have linked the SK Jain bribery episode to the inadequate pay packets of CMDs. While this needs to be substantially increased, emoluments alone do not guarantee integrity. What PSBs need is better regulation and monitoring by the Government and the RBI and not de-regulation and private control. The Syndicate Bank-SK Jain bribery episode is another reminder of the need to plug the loopholes in the banking system to weed out corruption. In this context, t the Nayak Committee recommendations of distancing the Government from PSBs must not be given importance.
- CH Venkatachalam, Gen Sec, All-India Bank Employees’ Association
Govt mulls law to give banks more muscle
................."Bank will be able to induct a new management if a company is unable to pay. The name-and-shame policy might be adopted for wilful defaulters. Assets on which security was not deposited could also be seized. For recovery of assets, banks should be able to look at other bank accounts as well. Defaulters often divert funds to other banks,"......
Indiabulls AGM Seals Promoter Split
............Meanwhile, shareholders also inducted two former bankers, KC Chakrabarty, the former deputy governor of the Reserve Bank of India and RM Malla, former chairman of IDBI Bank. At least one of the proposals, to remove independent director Joginder Singh Kataria was met with disapproval from the public institutional shareholders, 70 per cent of whom voted against the proposal..........
Mobile banking transactions: ICICI Bank crosses Rs 1,000-cr mark a month
..........It is not only the urban consumers that are banking on mobile phones but even bank customers in the rural area have also been transacting on mobile phones. The lender had launched, a text message based service for the un-banked populations and has that is mainly used in the rural area.............
United Bank starts naming and shaming big-ticket defaulters
..........More such unwanted publicity is in store for many big-ticket loan-takers whose accounts have turned bad loans (or NPAs, non-performing assets, in banking parlance). So far, Bipin Vohra of SPS group, Sandip Jhunjhunwala of Rei Agro, and Manoj Jain of Jain Infraprojects have figured in the bank’s zeal to humiliate industrialists by placing advertisements, carrying picture of directors on the board of defaulting companies. A prominent absentee in the names published so far is Vijay Mallya, the bank’s most high-profile defaulter. While United Bank has gone after Mallya with great enthusiasm in trying to recover some of the Rs400 crore lent to Kingfisher Airlines, his name doesn’t figure in the bank’s list of wilful defaulters as on June-end.........
Scrutiny of bad loans set to increase
......RBI is also looking at creating a separate category for borrowers considered “non-cooperative” and intends to make it tougher and more expensive for such borrowers to borrow from the banking system. “We are looking at our own definition of non-cooperative defaulter and trying to see how we can make it operational. Non-cooperative defaulters may not be in violation of the laws but we have this genre of promoters who hold up collections at every court using every instrument,” said Rajan. “That’s perfectly legal but from the perspective of the financial system it’s a problem because it can take years to collect. So we are saying that you are not a criminal but you are a financial risk. From that perspective, can we increase the cost of any new loans made to that person? Hopefully that makes the person think twice. So there is a financial stability angle there,” ...............
Bad loans & damage control
...........Given the recent controversies, there is a need to ensure that big-ticket loans are sanctioned by the boards of the banks only. The credit appraisal system can also be improved if appraisal teams are organised around industrial segments rather than geographies as is still the practice in many PSBs, leading to non-specialist industry credit officers. Why should each bank finance every industrial segment? ..........
IDBI Bank defends lending to Kingfisher
.............Raghavan, however, defended the bank’s decision to disburse the loan to Kingfisher Airlines during 2008-09. “The CBI enquiry relates to the advance made in 2008-09. This was the time when Kingfisher was doing well,” Raghavan said even as IDBI Bank’s share tumbled 5 per cent on the NSE to touch a low of Rs 79.35 amid CBI launching probe into the bank’s Rs 950 crore loan to the debt laden airlines.........
SBI staff threaten closure
................“Our anger is directed towards the government as it cannot ensure our safety and security although we have come here to serve the people. In the past year alone, three SBI officials have been abducted from Garo hills,” ...........
Deutsche Bank India HR head to join Kotak Bank
Makarand Khatavkar, MD & head of HR at Deutsche Bank Group in India, is believed to have put in his papers.Khatavkar, who has been with Deutsche Bank for a decade, is believed to be joining Kotak Mahindra Bank as its HR head. Subhro Bhaduri, who was earlier heading this function at Kotak Mahindra Bank, has joined Aditya Birla Group as chief people officer of its financial services division. Although there is still time for the Deutsche Bank to take a decision on a new HR leader, it is quite likely that the candidate would come from within the bank,given the policies and culture of multinationals.Watch this space for more.
TOI
TOI
IDBI Bank to open 19 more branches in Odisha
..............The bank CMD today opened a zonal office in the city, aimed at empowering its regional network and encouraging business opportunities in the region. “The establishment of our zonal office complements and supplements the strengthening of our presence in the state. The bank’s initiative today is a testament to our commitment to empower the zones to bring in unprecedented financial solutions to our customers,” said Raghavan.........
New TDS procedure
..............Is the Government so bankrupt of ideas for raising funds that they are now resorting to taxing clerical errors? If so, then I think tax paying citizens have a right to put the Government in the docks for all the taxes collected and grossly misused/ abused as reported by the Comptroller and Auditor General (CAG) and various exposes, which come out in the media from time to time. Because those errors of omission and commission (deliberate or otherwise) are not clerical they are made by highly educated and qualified people in Government!.....
Mr Sinha, did SEBI make the FM aware of these cases of brazen price rigging?
..............This is a lot of taxpayers’ money and nobody knows if SEBI is truly looking at cases triggered by the systems, if at all, let alone punishing offenders and compensating minority shareholders. Nobody knows how effective SEBI’s surveillance system is either...........
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