Tamal Bandyopadhyay, columnist and author of several books like From Lehman to Demonetisation: A Decade of Disruptions and Sahara: The Untold Story, tells Rediff.com why Yes Bank depositors should not panic and the current crisis at India's fifth largest private lender does not pose any systemic risk.
Banks will also consider requests from MSMEs for restructuring their stressed standard assets. So far, only 25 per cent of the around 1 million eligible MSMEs have taken benefit of the RBI's special dispensation.
It may be a 'no-go' for banking licences to large industrial houses.
Which is the best home loan? Advice from financial guru Harsh Roongta.
This comes at a time when competition has increased significantly.
The disruptions caused by COVID-19 have more severely impacted small and mid-sized corporates, including NBFCs and MFIs, in terms of access to liquidity.
Former RBI governors Urjit Patel and Raghuram Rajan have also expressed worry about the Mudra scheme, particularly government's target-setting practice and the rising bad loans.
From FY18, Ind-AS will be mandatory for all listed entities, barring those listed on the SME platform.
Discussion paper fixes Rs 1,000 cr as minimum capital for these specialised banks
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
In a mixed bag for HDFC Bank ahead of the parent HDFC's merger with itself, the Reserve Bank of India has declined to make exceptions on certain aspects, and has offered some leeway on others. The country's largest private sector lender, which is aiming to conclude the merger with the home finance major by July, had written to the central bank seeking certain forbearances after announcing the $40-billion merger in April last year. In an exchange filing this evening, HDFC Bank said it received a response from RBI on Thursday and also said that there are a few pending issues.
India's top listed companies reported their best-ever quarterly net profit of Rs 2.39 trillion in the September quarter of FY22, up 46.4 per cent year-on-year. The earnings were driven by a big surge in the profitability of banks, non-banking financial companies & insurance (BFSI), oil & gas, and metal & mining firms. The combined net profit of these three cyclical sectors were up 87 per cent YoY to a record high of Rs 1.53 trillion, up from Rs 82,000 crore a year ago and Rs 1.08 trillion in Q1FY22.
The RBI governor's assurance should give investors enough confidence to start believing in the NBFC sector again, say bankers.
Further stimulus measures are expected in the upcoming Budget where the focus is likely to be on reforms, including some structural measures such as reducing red tape and boosting foreign direct investment. The meeting with industrialists is in the series of discussions that Modi has had during the last couple of weeks to seek suggestions to revive growth.
Why can't we have a sunset clause for the ARCs, which is a global norm? questions Tamal Bandyopadhyay.
Auto-debit payment bounces have gone up for the second consecutive month in May, emphasising the stress building up due to a halt in economic activities as authorities lock down various parts of the country to stop the spread of the virus in the second wave. According to the National Automated Clearing House (NACH) data, in May, of the 85.7 million transactions initiated, 35.91 per cent, or 30.8 million transactions, failed.
Raamdeo Agrawal, joint managing director at Motilal Oswal Financial Services, tells Sheetal Agarwal key trends in this earnings season and investment themes in Indian markets.
Gadkari said, infrastructure sector including highways, airports, inland waterways, railways, logistic parks, broad gauge and metro, apart from MSMEs can attract large scale foreign investment.
'If businesses are focused on de-leveraging, they can hardly be investing. This is the price extracted by investment mistakes during UPA rule, and should have been foreseen. 'But Modi-I must share the blame, for muted reform of the financial sector, partisan policy in telecom, the harm done to exports by an over-priced rupee, and so on,' says T N Ninan.
The mutual fund (MF) industry has seen a fair number of new entrants in the last 10 years but none of them have proved to be much of a challenge for the larger players. The list of top 20 fund houses, which manage over 90 per cent of the industry's total assets, continues to be dominated by players who have been in the business for more than a decade. Bajaj Finserv MF may change that, say experts.
Fintech companies believe that the impact of Reserve Bank of India's order last week on unsecured loans will be visible in six to 12 months and prompt them to diversify and strengthen their secured portfolio. Fintechs which source funds through banks or non-banking finance companies (NBFCs) are looking at quickly building their secured portfolio options to at least 40 per cent of their total portfolio. "Over the medium to long term, as part of our product strategy, we are evaluating secured products which can be enabled over a digital platform" said Yogi Sadana, the founder of Zype, a lending-focussed fintech.
With more and more youngsters preferring to shop online, the credit appetite has surged.
'The banking sector appears to be on course to recovery,' declares the RBI governor.
Existing bank deposits will continue with past rates until renewed on maturity.
Corporate indebtedness is now twice what it was before the global financial crisis; banks' bad loans ratio is 3.5 times higher.
'One of the ways to do that is to ensure that NBFCs have got liquidity.' 'If we don't do that, this mood of gloom will continue.' NBFCs need to be provided with liquidity if they have to start lending.
The committee's suggestion that existing commercial banks be allowed to hold payment banks as subsidiaries is also seen as unviable by RBI and the finance ministry.
While start-ups are making it easier to borrow, one needs to choose carefully.
Bandhan financial Services will raise funds via internal accruals.
With at least three IPOs in the offing this year, stock market investors have a lot to look forward to.
The RBI on Friday said it will give banks Rs 1 trillion through targeted long-term repo operations (TLTROs), of up to three-year maturity, to deploy in "investment-grade corporate bonds, commercial paper, and non-convertible debentures over and above the outstanding level of their investments in these bonds as of March 27, 2020."
New norms are in place to strengthen regulations for this set of lenders which has been playing a critical role in Asia's third largest economy, notes Tamal Bandyopadhyay.
Some of the firms that have witnessed major drop in analysts' coverage include Dish TV, YES Bank, and JSW Energy.
According to Fitch rupee is expected to weaken to 72 to a dollar by the end of December 2019, and further to 73 by December 2020, from 69.82 to a dollar in end December 2018.
In the first eight months of 2019, 70 per cent stocks in the BSE 500 universe were down. These stocks account for 94 per cent of India's total market capitalisation.
If you are running a sweetmeat shop, will you manage a dairy for milk supply or buy milk from the market? Banks are running a dairy (which has its cost for processing milk), while NBFCs are buying milk from the market, observes Tamal Bandyopadhyay.
For the first time in our economic history a government has thought about more than 50 per cent of our economic activity instead of the five per cent represented by the Sensex companies, observes IIM-B professor R Vaidyanathan.
With auditing under the scanner and two of the Big Four firms stopping non-audit services for audit clients, auditors will now be subjected to a more stringent standard of reporting.
The total wealth of top 100 real estate barons accounted for Rs 2.37 trillion ($32.7 billion) in 2018, up 27 per cent against 2017's cumulative wealth of Rs 1.87 trillion ($28.6 billion).
