A panel headed by RBI Governor selects PSU bank chiefs.
If they are made accountable, bad loan cases will shrink dramatically, recoveries will rise, and the NCLT process will be more manageable, asserts Debashis Basu.
Banks have raised concerns over the new international trade settlement in rupee, fearing that facilitation of such a mechanism could result in them facing the ire of economic sanctions by the West, people aware of the matter said. Large banks with overseas operations have sought clarity and assurance from the Reserve Bank of India (RBI) that they will not be targeted with sanctions for facilitating rupee trade with a sanction-hit country such as Russia. The present payment mechanism is a shift from earlier such arrangements, like the one with sanction-hit Iran, which involved banks facilitating settlement of international trade that did not have business in the sanctioned nation.
The EC is yet to decide on RBI's request to grant new licences during the election season.
The comments come a year after the government tagged Bitcoins and other crypto-currencies illegal and following which the RBI banned trading on them.
The new hire, Gangadhar Darbha, joined as a consultant
Reserve Bank of India Governor D Subbarao on Tuesday said the central bank needed more powers before it could firm up the final guidelines on new bank licences.
Managing Brexit, inflation and banking reforms, along with the political environment, will be tough.
The RBI's Monetary Policy Committee brainstormed the impact of any future shocks on the inflation trajectory and stressed monitoring the cumulative effect of monetary policy actions over the past one year, which is still unfolding, revealed minutes of the rate-setting panel released on Thursday. The minutes of the meeting of the Monetary Policy Committee (MPC), headed by Reserve Bank Governor Shaktikanta Das, also indicated it would be premature to declare an end to the monetary tightening cycle, which started in May 2022 to check high inflation following the outbreak of the Russia-Ukraine war. The central bank, which effected six back-to-back hikes in the key short-term lending rate (repo) since May 2022 to check high inflation, decided to take a pause early this month.
The year 2022 saw the Reserve Bank of India (RBI) start acting on the policy repo rate after a gap of two years. The six-member monetary policy committee of the RBI reduced interest rate sharply - by 115 bps - when Covid-19 struck in 2020. In March 2020, days after the nationwide lockdown was announced, MPC in an unscheduled meeting reduced the repo rate by 75 bps, followed by another 40 bps in May. Status quo was maintained for the next two years since the May repo rate hike.
Given Indian corporates's high indebtedness, new credit will be used for servicing loans rather than building factories. This is setting us up for more companies on life support and more zombie banks, warns Rahul Jacob.
The Bharatiya Janata Party (BJP) on Tuesday welcomed the appointment of noted economist Raghuram Rajan as RBI governor but advised him not to compromise on the autonomy of the institution or get cowed down by the government.
The mobile banking app of the largest private sector lender HDFC Bank, which has been under the regulatory lens for network outages, was down for an hour on Tuesday due to unspecified issues. The city headquartered bank said the issues were faced for an hour late in the morning on Tuesday and the same was resolved in an hour. It urged customers to use the net banking alternative to transact in the interim.
The central bank's decision to raise the repo rate is a signal to commercial banks either to increase their deposit base or improve credit quality appraisal, RBI Deputy Governor Rakesh Mohan said on Tuesday.
China's central bank said late on Saturday it was ready to make the Yuan more flexible.
The Reserve Bank of India on Thursday marginally lowered its inflation projection for the current financial year to 5.1 per cent, as Governor Shaktikanta Das said the central bank's monetary policy actions are yielding the desired results. In April, the Reserve Bank had estimated the consumer price index (CPI) based retail inflation at 5.2 per cent during the fiscal 2023-24. CPI inflation fell sharply to 4.7 per cent in April 2023, from 6.4 per cent in February, on the back of favourable base effects, with softening observed across all the three major groups.
Governments that do not respect central banks' independence will sooner or later incur the wrath of the financial markets, ignite economic fires, and come to rue the day they undermined an important regulatory institution; their wiser counterparts who invest in central bank independence will enjoy lower costs of borrowing, the love of international investors, and longer life spans, said Acharya, who will return to the New York University's Stern Business School in August.
The Reserve Bank's rate-setting panel began its three-day deliberations on Monday to decide the next monetary policy amid expectations that the central bank will maintain status quo on the benchmark interest rate in the backdrop of global scare due to the new coronavirus variant Omicron. Reserve Bank Governor Shaktikanta Das headed six-member Monetary Policy Committee (MPC) is scheduled to announce the policy resolution on Wednesday. If the RBI maintains status quo in policy rates on Wednesday, it would be the ninth consecutive time since the rate remains unchanged.
"I'm taking a minute to respond... I do respect Raghuram Rajan as a great scholar who chose to be in the central bank in India at a time when the Indian economy was all buoyant," Sitharaman said during the lecture organised by the Deepak and Neera Raj Centre on Indian Economic Policies of the Columbia University.
RBI had received 72 applications for small finance bank licences.
Nationalisation has served its purpose. It's time to move ahead, keeping majority ownership of the government in a few banks to serve the people, argues Tamal Bandyopadhyay.
Banks should start looking for ways to generate more internal capital as the leeway to get additional funds from the government would be limited due to the ongoing fiscal consolidation process, Mundra said.
These cash shortages increase banks' funding costs, making it harder for them to lower lending rates
Will Arundhati Bhattacharya be the RBI's first woman governor? Or will Urjit Patel succeed Raghuram Rajanas RBI governor when his term ends on September 4?
Draft norms soon, but central bank worried about self-dealing by company promoters.
The report contains names of entities eligible for bank licences. It was not immediately known how many applicants have been shortlisted by the high-level advisory panel.
A day ahead of Mexican Central Bank Governor Agustin Carstens' visit here to seek support for his candidature for the top IMF post, the Finance Ministry on Thursday said the decision on India's vote will be taken by Prime Minister Manmohan Singh.
Concerned over banks hiding their actual NPA numbers, RBI Governor Raghuram Rajan on Tuesday said the central bank is "increasingly turning towards taking action" on such divergences.
The RBI's rate-setting panel MPC on Monday began its three-day deliberation amid expectations of another round of hike in benchmark interest rates to contain inflation that continues to remain above the central bank's upper tolerance level. RBI Governor Shaktikanta Das will announce the decision of the Monetary Policy Committee after deliberations on Wednesday. Das has already indicated that there may another hike in the repo rate, though he refrained from quantifying it.
The Reserve Bank of India on Wednesday retained its growth projection at 7.2 per cent for the current fiscal on the back of improvement in urban demand and gradual recovery in rural India. Unveiling the third monetary policy for the current fiscal, RBI Governor Shaktikanta Das said the Indian economy remained resilient, and the central bank will continue to support growth. The RBI expects growth in the first quarter of the current fiscal at 16.2 per cent, which will taper to 4 per cent by the fourth quarter.
Market participants do not expect any immediate impact on the rupee from the Reserve Bank of India's (RBI's) a "comprehensive" master direction aimed at strengthening the framework for hedging foreign exchange risks. RBI Governor Shaktikanta Das, in his monetary policy statement, revealed that the central bank is poised to issue a master direction to consolidate guidelines for all types of forex transactions. But this development, according to market players, is more of a directional guidance than a mandatory directive.
The Pittsburgh summit could determine the timing of a calibrated winding down of public spending, now that the signs of a global economic recovery are evident.
India's banking sector, dominated by more than two-dozen state-run lenders, has been hobbled by its highest bad-loan ratio.
The Reserve Bank of India on Wednesday expectedly left interest rates unchanged and maintained an accommodative stance as the economy faces a renewed threat to growth due to the resurgence of coronavirus cases.
The macro economic situation and currency depreciation might top the priority list of Reserve Bank of India (RBI) governor-designate Raghuram Rajan.
RBI Governor Shaktikanta Das on Friday said the entry of big tech firms into the financial sector poses systemic concerns like overleveraging at the borrowers' ends.
A senior official with Muthoot Finance said the group would also want to apply for a universal licence.
Reserve Bank of India and State Bank of Pakistan are working on modalities for opening branches of each other's banks in both the countries.
The RBI kept its key policy repo rate unchanged at 8.0 percent in its recent monetary policy.
