Indian corporate are fast tapping the international bonds market to raise funds for their operational expenses even as they reduce their presence in the rupee bond market. As bonds are costlier for companies and investors are more sceptical than the banks, chief financial officers say they are looking at other avenues for raising funds in the coming months as dollar bond rates are lower in the range of 100 to 250 basis points. "For corporate with reasonable credit quality, the Indian bond market has become less of an option from a cost point of view. "In addition, conditions imposed in the Indian bond market by investors post Franklin episode have also become very onerous," said Prabal Banerjee, president-finance of Bajaj group. "Hence very few corporate are looking at the local bond market for resource mobilisation, since both, bank loans and the overseas bond markets are much more attractive," he said.
The bank will now be in a position to resume normal lending activity, including corporate lending, with tightened risk management framework.
The combined deposits of its Indian operations stood at SGD 9 billion and net advances were at SGD 5.6 billion at the end of December 2020.
The hoarding of cash accentuated from the very start of 2020, when the coronavirus pandemic started taking hold the world over, and fear of the pandemic prodded people to remain liquid for emergency use.
'The financial sector's performance in the first two quarters was a revelation.' 'It clearly showed the clean-up had been done in the past one-and-a-half years and that capital brought in was significantly stronger.'
While lenders create a hype around the services offered on digital platforms, customers think otherwise, given that frustration due to the quality of service has only increased, over the years.
In a bid to gain a bigger share of the customer's wallet, banks are ramping up their cross-selling initiatives.
The interest rate offered by PSBs like SBI, BoB and BoI hover around 8.9 per cent-10.50 per cent. For private banks, the range is between 10.49 per cent and 12 per cent.
But what do banks gain by opening their apps for all? The answer -- rival bank's customers under their fold.
'We tightened our risk frameworks once the Covid crisis started.' 'We are slowly lightening this as we see economic activity pick up, salaries getting restored, and people getting back into jobs.'
'When there is unlocking, there is demand revival.' 'This is going to be the main growth engine in this kind of an economic scenario.'
NBFCs with a proven track record, supported by the brand values of reputed corporate, can play a key role in bringing the benefits of banking and economy to the underserved and newer segments of India.
Banks now ride on what is defined as a "banking outlet". This is a fixed-point service unit, manned by either the bank's staff or its business correspondent (BC), where all kinds of services - acceptance of deposits, encashment of cheques, cash withdrawal or lending of money - are provided for a minimum of four hours per day, for at least five days a week. Banks are now turning to reposition the manner in which they acquire customers, report Abhijit Lele and Raghu Mohan.
The winning bid attracted over 99 per cent votes, with lenders overwhelmingly voting for a revival instead of recovery through liquidation.
Apart from fulfilling banking services, one can access more than 100 e-commerce sites, book tickets, and even pay for small value groceries through the app. The bank is now proposing to allow other banks to use this to serve their own customers.
PNB has rich experience in the integration of commercial banks.
It has been a year since the Reserve Bank of India (RBI) initiated prompt corrective action (PCA), an exercise that puts weak banks under central bank scrutiny, against the 94-year-old Lakshmi Vilas Bank (LVB). But recently, this low-profile Chennai-headquartered bank found itself attracting some unwonted publicity when 60 per cent of its shareholders voted against a proposal to re-appoint seven directors, including one of the promoters, K R Pradeep (who holds around 2 per cent), and the company's managing director & chief executive officer S Sundar.
The public sector lenders saw the biggest rebound in inquiries in July and August 2020, most likely because they were early in recommencing operations than their private and finance counterparts.
Banks say they themselves red-flagged the transactions to RBI. It must be noted that these transactions are not outright evidence of fraud or proof of nefarious activities.
'The economy is expected to bounce back and things are expected to recover faster than what we previously thought.'
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