After a sharp fall in the share prices of HDFC Bank and other private sector lenders in the past three days, the BFSI (banking, financial services and insurance) sector weighting in the Nifty50 has slipped to a seven-year low of 32.03 per cent, down from nearly 36.6 per cent at the end of March 2023 and 34.5 per cent at the end of December 2023.
The global turmoil in the banking sector has made analysts cautious, who advise that investors stay away from stocks of this sector till the overall sentiment improves. The recent trouble for the banking sector started with the collapse of US-based Silicon Valley Bank (SVB), Silvergate Capital and Signature Bank. On its part, Moody's Investors Service has also cut its outlook for the US banking system to 'negative' from 'stable', citing the run on deposits at these three banks that led to the collapse of these banking majors in less than a week.
Despite the Finance Minister asking public sector banks not to hike home loan rates, top private sector lender ICICI Bank, accounting for 30 per cent of home loans, has said all lenders would have to increase rates for their own survival.
The BJP had not filed till May the expenses statement for the Karnataka Assembly elections held last year in July.
Banking and insurance services were paralysed on Tuesday as their staff and officers joined public sector employees on a day-long nation-wide strike
Budget 2015 has blessed the banking sector.
As public sector bank employees started a two-day strike on Monday seeking higher wages, Finance Minister P Chidambaram said the profit of banks cannot be used only to enhance salaries because there are other obligations.
The move would retain the public sector character of these banks, as the holding company will be wholly owned by the government, finance ministry officials said. This company, in turn, will own a majority stake in the banks.
'Many global investors have been overweight on dollar assets, so some diversification or hedging is naturally expected.'
Bad loans in public sector banks more than tripled.
Letter to corporate affairs ministry cites slowing economy, capital challenges.
Banks are gaining market share at the expense of non-bank lenders such as housing finance companies, retail lenders, and those giving gold loans. There has been a steady decline in the market share of non-banking financial companies (NBFCs) in the credit market as banks have stepped up lending. NBFCs' share declined to a five-year low of 19.8 per cent in the first half of FY23, down from 20.3 per cent in H1FY22, and an all-time high of 23.1 per cent in H1FY19.
Strike is total, impacts all branches of PSU and private banks. Clearing operation at RBI also hit.
Banks, including country's largest lender State Bank of India, have informed the customers well in advance about the likely inconvenience due to strike.
At present, 58 per cent of the population has bank account.
The sector seems set for a rally that may be somewhat temporary.
RBI said the improvement in asset quality was driven by state-run lenders which saw a drop both in both GNPA and in the net NPA ratios.
Amid a rise in non-performing assets, most public sector banks have seen a substantial drop in their provision coverage ratio in the year since the reserve Bank of India (RBI) withdrew the 70 per cent provision coverage ratio norm.
Banks recovered Rs 18,933 crore (Rs 189.33 billion) worth of bad loans during the April-December period.
The government's step to curtail fiscal deficit is helping the central bank's monetary policy, Rajan said.
Imagine a tiny automated teller machine (ATM) that could be carried anywhere in your bag. Unusual it may sound, but Gujarat will soon have such small ATMs. In a novel initiative to make rural banking hassle-free, public-sector bank Dena Bank is gearing up to roll out these little ATMs in a couple of rural areas on experimental basis.
Breaking his silence after a long time, to state the "factual position in response to the controversy unfortunately surrounding" him, Mallya said he had written letters to both the prime minister and the finance minister on April 15, 2016, to explain his side of the story. "No response was received from either of them," he said in a statement.
'We continue to view India as a standout within EM.'
Several Indian banks have alerted their customers not to download apps from any source other than official app stores. Banking customers are being targeted by a new type of mobile banking malware campaign using SOVA Android Trojan. This malware captures the credentials when users log onto their net-banking apps and access bank accounts. The new version of SOVA appears to be targeting more than 200 mobile applications, including banking apps and crypto wallets.
With the restructuring process in full swing, public sector banks have stepped-up monitoring to keep non-performing assets (NPAs) at desired levels.
Banks have been patient and flexible in rescheduling loans.
Hemendra Hazari of Karvy Stock Broking believes that government banks will be impacted by rising bond yield because they have a much higher proportion of investments and their durations are higher too.
As many as 20 public sector banks, including big ones like Canara Bank, Bank of Baroda and Union Bank, have failed to achieve the annual farm sector lending target till November, 2009.
Gross non-performing assets (GNPAs) of banks may rise to 9.8 per cent by March 2022 under a baseline scenario, from 7.48 per cent in March 2021, according to the Financial Stability Report (FSR) released by the Reserve Bank of India. Under a severe stress scenario, GNPA of banks may increase to 11.22 per cent, it added.
During the first half of the financial year 2021-22, the reported number of fraud cases in various banking operations increased to 4,071 as against 3,499 in the year-ago period, the RBI's Report on Trend and Progress of Banking in India 2020-21 showed. However, the amount involved in frauds in various banking operations based on the date of reporting declined to Rs 36,342 crore during April-September 2021 from Rs 64,261 crore in the corresponding period of the previous financial year, the report said on Tuesday. In H1 2021-22, banks saw 1,802 reported cases of frauds amounting to Rs 35,060 crore which were related to advances.
Private banks are assumed to be more efficient at intermediating between depositors and investors.
Simplifying GST rates, removing exemptions, easing disputes, and speeding up refunds can boost investment in India and offer the best reply to Trump's tariffs, observes V S Krishnan, former member, Central Board of Indirect Taxes and Customs.
The Reserve Bank of New Zealand has given permission to the Bank of Baroda to begin trading in the country, making it the nation's 19th registered bank.
India must improve business climate.
Employees of public sector banks have gone on two-day nationwide strike on Wednesday opposing banking sector reforms and outsourcing of non-core activities, affecting operations.Several private sector banks, foreign banks and ATMs, however, continued to operate normally.
The finance minister, in her Budget speech, should focus more on what she is directly responsible for, rather than on programmes where her role is largely supportive, notes Nitin Desai.
Bain Capital-backed Tyger Capital is planning to list its shares on the Indian stock exchanges by the next financial year and is targeting to grow its assets under management by four times to Rs 20,000 crore in five years from Rs 5,000 crore now, Gaurav Gupta, MD and CEO of the firm said. In an exclusive interview, Gupta said that keeping with the growing business, the finance company expects to on-board 600 people in the current financial year as it is opening 60-65 new branches for broad-basing its network in the country.
The decision, taken at a Cabinet meeting, will help lenders provide farmers short-term crop loan at 7 per cent interest.
