India's banks rely on overnight borrowings to fund longer-term lending.
'The Reserve Bank's independence has remained a work in progress, an enduring challenge that the nation has been grappling with on an ongoing basis,' says RBI Deputy Governor Dr Viral Acharya.
FTIL prepares to challenge the order in the Bombay high court
RBI had previously cut repo rate by 0.25% each in January and March.
Rajan retained the short-term lending rate at 6.5 and the cash reserve requirement of banks at 4 per cent.
A bonus is given to existing stockholders in proportion to the number of shares they already hold.
Some genius assumed that a 2,000 note could seamlessly replace 500s and 1000s in ordinary transactions. If that genius had consulted an actual chai-wallah, he might have thought twice, argues Devangshu Datta.
The finance minister's meeting with chief executives and managing directors of banks ahead of the Union Budget assumes significance in view of the critical role the banking sector plays in boosting consumer demand across sectors.
Slowdown and liquidity squeeze by RBI have put India's top 10 indebted firms in a tight spot. But they have a few options.
Indians face COVID-19 with record debt, stalled income.
'When an institution believes its knowledge and capability is superior to everyone, it behaves like a frog in the well.' 'And this is precisely the cause for the mess,' says J N Gupta.
Banks normally park almost 27 per cent of their funds in government securitie.
'We don't know how much the Pay Commission outflow will be.'
Last month, the bank was placed under Prompt Corrective Action due to high level of bad loans, lack of sufficient capital to manage risks and negative return on assets for two consecutive years.
Axis Bank and ICICI Bank consumed 37-59 per cent of their operating profit for COVID-19 provisioning, while the figure is 24 per cent in case of Kotak Mahindra Bank and 10-12 per cent for IndusInd Bank and HDFC Bank.
The mergers will not involve any cash but only share swaps
'The banking sector appears to be on course to recovery,' declares the RBI governor.
'The Budget will have to be substantially re-cast as soon as a new government takes charge after the elections.' 'Both revenue and expenditure numbers will have to be trimmed -- and then may better reflect the deceleration of economic activity caused by slowing consumption trends,' points out T N Ninan.
LIC, ICICI Bank, PNB to have nominees on board; firm asked to sell non-core assets.
I-T lens on current account deposits over Rs 12.5 lakh. All the news and more post demonetisation.
While taking gold out of the closet to borrow money is no longer taboo in Indian households, the sharp drop in gold prices is hitting the newest loan product on the banking turf hard, explains Tamal Bandyopadhyay.
RBI said inflation in the second half of the current fiscal is projected at 2.7-3.2%. It retained its GDP forecast for the current fiscal at 7.4%
The ministry seeks to make lending requirements flexible for banks financing key stalled projects.
Bank of Baroda has relatively better position on impaired assets.
The government kept its nerve in the face of a massive shock. It chose not to resort to a massive fiscal stimulus. It focused instead on providing liquidity support and easing restrictions on movement in stages, observes T T Ram Mohan.
Rajan said that while there were talks about Jan Dhan, it was difficult to target transfers to people through this tool. Jan Dhan, he said, does not really work as advertised.
'This looks like a long-term bear market and there could be mounting losses in the near-term,' says Devangshu Datta.
It is important to know the right details about your insurance policies while avoiding these mistakes, says Harjot Singh Narula.
What will be its impact on the banks's balance sheets? Since banks need to provide for 10 per cent of the loans restructured, they would need Rs 50,000 crores to Rs 80,000 crore for this purpose, notes Tamal Bandyopadhyay.
The inflow of cheap capital has also kept the rupee at a high level, making exports uncompetitive and broadening the current account deficit despite falling oil prices.
10 stocks which are most popular with brokerages right now and are expected to deliver maximum upside over the next 12 months.
Since mid-July, the RBI has taken steps to tighten cash conditions, which have failed to support the rupee but sent bond yields surging, posing a fresh threat to the already cooling economy.
Like everything else, the structure of banks may change, and banks may depend more on digital technologies and artificial intelligence for dealing with both their customers and employees.
The recently approved government scheme provides both liquidity and returns.
Tamal Bandyopadhyay discusses his latest book Bandhan: The Making of a Bank at Bandhan headquarters in Kolkata.
The study points out that for the determination of growth and investment at the macroeconomic level, the real interest rate is more relevant, even though the nominal interest rate is important for investment planning at the firm level.
'The overall stress on asset quality is indeed coming down.'
Weak production outlook, low crude oil prices and regulatory issues could keep the scrip in check
A 2008-style bank run seems unlikely, but if it did happen, the sector is much better prepared.
With Narendra Modi about to make his first Independence Day speech, there is a buzz in Delhi that Modi will make some big announcements to signal major reforms and directional shifts. But we have to wait and see if it happens, says Mohan Guruswamy.
