Bank of Baroda has hiked interest rates for non-resident external term deposits across various maturities with effect from April 4.
The failure of SVB was due to idiosyncratic reasons, but shows how higher rates can expose fault lines in unforeseen places, observes Neelkanth Mishra.
The average value of retail digital payments dropped 48 per cent from Rs 8,769 in March 2021 to Rs 4,560 in March 2024 due to a growing preference to use digital modes of transactions for small value payments, according to the Reserve Bank of India's (RBI) report on the trend and progress of banking in India.
Sashidhar Jagdishan, managing director and chief executive officer of HDFC Bank, the largest private-sector lender of the country, has just completed his first term. The period October 2020-October 2023 was a roller coaster, and the second one, which started on October 27, could be more interesting as the lender absorbs the impact of the merger of HDFC, which was integrated on July 1, and moves to the next growth phase. Soon after he took over the reins from Aditya Puri on October 27, 2020, the Reserve Bank of India (RBI) debarred HDFC Bank from enrolling new credit card customers and launching new products under the Digital 2.0 programme due to repeated outages on its mobile-banking and internet-banking platforms.
The government's step could push investors to choose riskier equity, or to fall back on bank deposits, thereby negatively impacting the debt market which actually needs to grow, points out T N Ninan.
Currently there are 26 licensed players in the P2P lending sector but only 10-11 are actively operating.
Based on the current momentum, the funds likely to be raised through the RBI's relaxed window would be $3.5 billion-$4 billion.
"A time has perhaps come when we can now think of only allowing banks to acquire public deposits," Reserve Bank Deputy-Governor V Leeladhar told reporters on the sidelines of an Indian Merchants Chamber organised banking conference in Mumbai on Thursday. The number of deposit-taking NBFCs is sharply declining as also the amount of deposits with them, Leeladhar said.
The Reserve Bank India's (RBI's) decision to ban the onboarding of new accounts on the "bob World" mobile digital platform led to a selloff in the Bank of Baroda (BoB) stock. The stock of the public sector bank dropped by around 3 per cent. The central bank cited "material supervisory concerns"; news reports claimed mobile numbers were randomly linked to accounts to purportedly inflate registrations on bob World.
By acting now, you can step into 2025 with your finances in order and without unnecessary penalties.
The Securities Appellate Tribunal (SAT) has granted an interim stay on a Sebi order that slapped a penalty of Rs 2 crore on Yes Bank's former MD Rana Kapoor in a case of mis-selling the private sector lender's AT1 bonds. Kapoor has been in jail since March 2020 in connection with the DHFL money laundering case. The interim relief came after capital markets regulator Sebi in July issued a demand notice to Kapoor, warning arrest and attachment of his assets over non-payment of the fine of Rs 2 crore, along with the interest.
'The banks cannot pass on the hike in premiums to its customers, according to the norms. The premium won't go up substantially in any case and may be hiked to 12-13 paise (per deposit of Rs 100 a year),' Finance Secretary Rajiv Kumar said.
Lending rates in certain segments may be increased; fixed depositors may lock into existing rates.
The flow of deposits from non-resident Indians (NRIs) hit a four-year low in the financial year 2020-21 mainly due to contraction in foreign currency deposits, latest data released by the Reserve Bank of India (RBI) shows. Total NRI deposits during FY21 were $7.3 billion as compared to $8.6 billion in FY20 - the lowest since 2016-17, when such deposits had contracted by $12.3 billion. Indian banks have three kinds of deposit accounts where NRIs or PIOs (persons of Indian origin) can park their funds: non-resident external-rupee account (NRE); non-resident ordinary rupee account (NRO); and foreign currency non-resident bank account (FCNR [B]).
The Reserve Bank of India (RBI) on Monday said 97.87 per cent of the Rs 2000 denomination banknotes have returned to the banking system, and only Rs 7,581 crore worth of the withdrawn notes are still with the public. On May 19, 2023, the RBI announced the withdrawal of Rs 2000 denomination banknotes from circulation. The total value of Rs 2000 banknotes in circulation, which was Rs 3.56 lakh crore at the close of business on May 19, 2023, has declined to Rs 7,581 crore at the close of business on June 28, 2024.
Since the RBI is the 'lender of the last resort', as per terms of arrangement, Yes Bank would have to exhaust immediate liquid assets before accessing this fund.
They belong to fans who booked their World Cup travel and tickets through a Brazilian tour operator.
ICICI Bank and HDFC Bank have effected a cut of up to 0.50 per cent in term deposit rates following tepid credit growth and ease in money market rates.
10 largecaps stocks which stand to gain from the Budget.
'We face the risk of remaining a low-income country for a very long time unless something changes in the next few years.' 'Instead of constantly talking about becoming a developed economy, we need to start fixing the problems of the economy one by one.' 'There is so much potential, and we are squandering away the opportunity.'
Why did the company zero in on RBL Bank to understand the business of banking? While the M&M investors heaved a sigh of relief, one gentleman must have been all smiles after this, RBL Bank MD and CEO R Subramaniakumar, notes Tamal Bandyopadhyay.
'We may see little softness in liquidity position after the stabilisation of the government.'
HDFC Bank on Monday reported a consolidated net profit of Rs 16,811 crore for the September quarter, its maiden quarterly earnings announcement after merging parent HDFC with itself. On a standalone basis, the largest private sector lender reported a net profit of Rs 15,976 crore. In the year-ago period, the net profit of the merged entity would have been Rs 11,162 crore on a consolidated level while the same on a standalone basis would have been Rs 10,606 crore.
HDFC Bank Q1FY24 results analysis: Shares of HDFC Bank, the world's seventh largest financial entity, have advanced 2 per cent in two days, as against 1 per cent rise in the benchmark S&P BSE Sensex, after the lender reported its April-June quarter (Q1) results for financial year 2023-24 (FY24) on July 17. The S&P BSE Bankex index, meanwhile, has gained 1.3 per cent. While the near-term stock performance may remain sideways due to merger-related hiccups, analysts remain bullish on the stock's long-term prospects.
The central bank gave 11 entities licences to start payments banks.
The Supreme Court of India has refused to halt the redevelopment project of Dharavi in Mumbai, allowing the Adani Group to proceed with their project. The court rejected a plea from Seclink Technologies Corporation, the original highest bidder for the project in 2018, which challenged the tender process and the award to Adani Properties Pvt Ltd in 2022. The court directed Adani Properties to make payments through a single bank account and ordered Seclink Technologies to file an affidavit detailing their increased offer for the project. The project work has already commenced, with constructions underway and 2,000 people employed on the site.
rediffGURU Ramalingam Kalirajan answers your personal finance queries.
Interest rates on fixed rate home loans have been increased by 0.75 per cent to 8.50 per cent from the current level of 7.75 per cent with effect from November 17, 2004.
The Reserve Bank of India on Friday announced withdrawal of Rs 2,000 currency notes from circulation, and existing notes in circulation can either be deposited in bank accounts or exchanged by September 30. The bank notes in Rs 2,000 denomination will continue to be a legal tender, the RBI said in a statement. In order to ensure operational convenience and to avoid disruption of regular activities of bank branches, the RBI said exchange of Rs 2,000 bank notes into bank notes of other denominations can be made up to a limit of Rs 20,000 at a time at any bank starting from May 23, 2023.
For the banking system a new cycle starts in FY2024. It's fraught with fresh challenges on asset quality and profitability, warns Tamal Bandyopadhyay.
Private sector lenders have been communicating to their customers about their strong capital positions but it has not put depositors at ease.
The Union Finance Ministry on Tuesday said that aggregate business of public sector banks (PSBs) has shown strong growth of 11 per cent in the first half of the financial year 2024-25 (H1FY25) to touch Rs 236 trillion. The operating and net profit were also robust. At Rs 1.5 trillion, operating profit grew by 14.4 per cent year-on-year (Y-o-Y) while the net profit saw an impressive 25.6 per cent jump at Rs 85,520 crore in the first half of FY25.
Ask rediffGURU and PF and MF expert Janak Patel your mutual fund and personal finance-related questions.
Slow credit off-take to put pressure on margins
The drop in net interest margin will separate the men from the boys, explains Tamal Bandyopadhyay.
With the merger between HDFC Bank and HDFC Ltd complete, analysts said the next key monitorable for the Street would be successful resolution of merger-related hiccups, including employee-related churn and roll out of complete banking services across branches. At the bourses, they expect the stock to perform in-line with the benchmark indices in the near-term. "There's usually an initial period of consolidation after a merger as the entities work towards integration.
Fears of banks' earnings plummeting in a deregulated savings deposit rate regime appear to have gripped investors, with most analysts hinting that profitability may come under pressure due to higher cost of funds amid slowing growth in advances.
The recent run on the US-based Silicon Valley Bank (SVB) and the subsequent seizure of its assets by the regulators may have sparked a global wave of risk aversion, particularly for start-ups. However, the Indian banking sector is unlikely to be a victim of any contagion effects, said analysts. he bank, which played a big role in financing start-ups and technology players, faced stress after incurring huge losses on its holdings of US bonds, following the most-aggressive monetary tightening cycle by the Federal Reserve in around four decades.
