Bandhan Bank has launched a new digital Provident Fund (PF) payment service, integrated with EPFO, allowing business customers to make statutory PF payments via the bank's internet banking platform. This service aims to streamline payments, optimise cash flows, and ensure timely compliance for businesses.
Private sector lender Bandhan Bank on Friday said its founder, managing director and CEO Chandra Shekhar Ghosh has tendered his resignation. Ghosh would retire from the services of the bank as MD and CEO upon completion of his current tenure on July 9, 2024, the bank said in a regulatory filing. "After leading the bank for almost a decade, including three consecutive tenures as MD & CEO, I feel that the time has now come for me to assume a larger strategic role at Bandhan group level," Ghosh said in a letter addressed to the board.
It is because dealing with a regulatory system that is largely headed by retired IAS officers then becomes relatively easy, points out A K Bhattacharya.
The asymmetry in deposit and credit growth is the biggest challenge before the Indian banking industry. For every 100 deposit that a bank mobilises, it needs to keep 3 with the banking regulator in the form of cash reserve ratio on which it doesn't earn any interest. Another 18 is used for buying government bonds (statutory liquidity ratio). This means, a bank is left with 79 for giving credit. Add to this, its capital which can be used for giving loans. Most banks are facing a fund crunch. They need to find ways to attract deposits if they want to sustain credit growth, explains Tamal Bandyopadhyay.
Bandhan Bank said on Monday that it has been empanelled by the Reserve Bank of India (RBI) to act as an agency bank to facilitate transactions related to government businesses. The RBI's decision will help Bandhan Bank in contributing to nation-building, its MD and CEO Chandra Sekhar Ghosh said. The announcement comes months after a RBI guideline that authorised scheduled private sector banks as agency banks of the regulator for the conduct of government business.
'Banking is the only sector that can see double-digit growth in FY27.'
Bandhan Bank is expecting that a little less than 50 per cent of its portfolio will be dominated by affordable housing loans in the next three to five years.
The bank will have around 501 branches.
Bandhan Bank's managing director (MD) and chief executive officer (CEO) Chandra Shekhar Ghosh (pictured), who has decided to step down, on Wednesday said the bank will need at least three months to identify his successor. He has also written to his employees, asking them "not to worry" over his surprise decision. "Whatever, our experience in the earlier selections, when we selected two executive directors on the basis of that experience we need a minimum three months of time for selection of candidates and then it will go to RBI and then whatever is the time taken by RBI for approval," Ghosh said.
Bandhan Bank to fund SMEs, create jobs, says FM
It is 10 years since Bandhan Financial Services became the first microfinance institution (MFI) to receive the universal bank licence. A year later, in 2015, it started operations. Bandhan's entry into banking was seen as a vote of confidence by the Reserve Bank of India (RBI) for the country's microfinance sector. Subsequently, the RBI awarded small finance bank licences to nine MFIs.
RBI's licensing norms require a bank to bring down promoter holding to 40 % within 3 years of operation - which, for Bandhan Bank, will be by Aug 23
'Midcaps and smallcaps are the 'go-to segments' for retail investors.'
Bandhan Bank has filed a draft red herring prospectus with Sebi for an IPO of up to 119 million equity shares, with face value of Rs 10 each.
The microfinance vertical of the bank will provide loans of Rs 80,000 to Rs 1,00,000.
Over 75 per cent of the bank's Rs 175 crore NPA arises from Uttar Pradesh, Madhya Pradesh and Maharashtra.
According to a 2011 impact assessment study of the programme by Banerjee and Duflo, along with economists Raghabendra Chattopadhyay and Jeremy Shapiro, Bandhan's THP results in a 15 per cent increase in household consumption and had a positive impact on wealth and welfare, such as assets and emotional well being.
The Reserve Bank of India's 2024 norms for the voluntary conversion of Small Finance Banks (SFBs) into universal banks, particularly the subjective 'diversified loan portfolio' criterion, are proving to be a significant hurdle, with Ujjivan SFB and Jana SFB having their applications returned.
Despite the Reserve Bank of India's (RBI) and the government's recent initiatives to attract foreign capital, which are expected to alleviate pressure on long-duration bonds, most debt fund managers are maintaining a cautious stance, favouring shorter-duration papers due to global uncertainties and potential future rate hikes.
What is the reason behind this drying up of talent for the top post in private banks?
Bandhan expects to commence banking operations in 2015, by opening nearly 600 branches targeting 10 million customers.
Private sector lender IDFC First Bank has lowered its savings account rates and introduced new slabs for small and medium balance categories, effective January 9, 2025, as per its website. The interest slabs and rates for higher balance accounts remain unchanged. Despite the revision, the bank continues to offer one of the highest savings account interest rates in the industry among mid-sized banks.
Ashok Lahiri, a distinguished economist with experience in government, the private sector, and electoral politics, has been appointed as the new Vice-Chairman of NITI Aayog, tasked with strengthening India's reform trajectory and policy-making.
Partha Pratim Sengupta, who will be taking charge as the MD & CEO of Bandhan Bank in early November, has his task cut out. The Kolkata-based lender, which converted itself from a microfinance institution to a universal bank, is in its 10th year of operation. The bank was able to cut down the share of the micro loan book over these years.
Bandhan Bank has declared disappointing results for the first quarter of the 2023-24 financial year (Q1FY24). While the market has been braced for known issues around microfinance exposures in West Bengal and Assam, there is higher stress in the portfolio. This means higher credit costs and poorer asset quality, leading to target downgrades by analysts.
Bandhan financial Services will raise funds via internal accruals.
India's private-sector banks are likely to lose market share for a second consecutive year in 2025-26, as their loan books continue to expand much slower than overall bank credit.
From zeroing in on the best means for stake dilution to moving beyond microfinance, Bandhan navigates a tough path. Namrata Acharya reports.
Ask rediffGURU and PF, MF and insurance expert Purshotam Lal your mutual fund, insurance and personal finance-related questions.
One 97 Communications Ltd, operating under the Paytm brand, has transitioned to a majority Indian-owned and controlled company, reflecting increased domestic investor confidence and improved financial performance.
'We want to become India's topmost integrated studio, working in different languages.'
Ask rediffGURU Naveenn Kummar your insurance mutual fund and personal finance-related questions.
Yes, the entry of private bankers, particularly with global experience will add value to PSBs, points out Tamal Bandyopadhyay.
The two entities' combined distribution network would comprise 4,182 banking outlets and 476 ATMs across 34 states and Union territories of India, with more than 31,000 employees serving about 15 million customers across the country.
With over Rs 15,000 crore in deposits, its strategy is a hit for now, but the real test will come when it starts lending to retail and corporate customers in a big way
Net NPAs increased to Rs 36,260 crore in the December quarter from Rs 34,843 crore in September and Rs 33,116 crore in December 2023, observes Tamal Bandyopadhyay.
Ask rediffGURU Reetika Sharma your insurance, mutual fund and personal finance-related questions.
As the fight for deposits intensifies, the cost of money will rise and the margin will be under further pressure, points out Tamal Bandyopadhyay.
Privately, many bankers admit their immediate goal is not growth but slowing the erosion of Casa deposits, reveals Tamal Bandyopadhyay.
For India's leading MFI-turned bank, the challenge is to stay competitive while pricing its loans
