The regulatory actions, undertaken by the RBI and the government, came hours after finance ministry sources confirmed that SBI was directed to bail out the troubled lender. For the next month, Yes Bank will led by the RBI-appointed administrator Prashant Kumar, an ex-chief financial officer of SBI.
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.
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 Producer Price Index will be better able to measure the average change over time in the sale prices of domestic goods and services, the Reserve Bank Governor said.
Warning that the worst may not be over yet, Reserve Bank Governor D Subbarao has said the global economic recession may not only continue through 2009 but could prolong to the next year as well.
Reserve Bank of India Governor D Subbarao on Wednesday contested the idea of "making banking boring" to bring back economic stability, mooted by Nobel laureate Paul Krugman in the wake of global financial meltdown.
The Reserve Bank of India on Friday decided to keep benchmark interest rate unchanged at 4 per cent but maintained an accommodative stance even as the economy is showing signs of recovery after the second Covid wave.
The last time RBI allowed new private banks was in 2002, prior to which it allowed new players in the mid-90s.
New-generation private sector banks such as ICICI, HDFC, Axis, Kotak etcetera owe their existence to the recommendations of the first Narasimham Committee.
The country must thank God and the previous Reserve Bank of India Governor Y V Reddy for safeguarding the banking system in India from the global financial meltdown, Punjab National Bank's chairman and managing-director K C Chakrabarty said on Sunday.
Calls by India and Brazil for appreciation of Chinese currency smacks of protectionism borne out of concerns over growing trade imbalances with China rather than the two countries backing US demand for Yuan revaluation, Chinese analysts said.
Reserve Bank of India (RBI) governor Raghuram Rajan says global markets are at risk of a "crash" should investors start bailing out of risky assets created by the loose monetary policies of developed economies.
Former Reserve Bank of India Governor Duvvuri Subbarao has said the central bank could lose control over money supply and inflation management if cryptocurrency is allowed in the country. Speaking at a webinar organised by the National Stock Exchange (NSE) and New York University (NYU) Stern School of Business, Rao also said India's case for issuing a central bank digital currency (CBDC) may not be strong as there are capital controls. "Crypto is backed by algorithms and there is fear that the central bank might lose control over money supply and inflation management.
Market participants attribute the stability to the Reserve Bank of India's timely intervention in the foreign exchange market, both in terms of selling and buying dollars.
The RBI on Thursday said banks' gross NPA ratio has fallen to a sever-year low of 5 per cent and the banking system remains sound and well-capitalised. In the 26th issue of the Financial Stability Report (FSR), the RBI also said the global economy is facing formidable headwinds with recessionary risks looming large. The interplay of multiple shocks has resulted in tightened financial conditions and heightened volatility in financial markets, it pointed out.
"Given the current economic context, and given the policy initiatives of the RBI, there is considerable scope for banks to reduce lending rates," said RBI Governor D Subbarao. He also pointed out that the several fiscal stimulus packages formulated by the government, together with monetary accommodation and counter-cyclical measures announced by the central bank, have started showing revival signs.
What stood out in his 15-year journey as a member of the political executive at the Centre was his glowing record as India's most successful and effective finance minister. Both as prime minister and finance minister, he understood the importance of gradualism, except when the economy or the polity was in a crisis.
Bankers made this demand at a meeting with RBI Governor Y V Reddy, ahead of the 2007-8 monetary policy announcement on April 24.
Reserve Bank Governor Raghuram Rajan on Thursday said the central bank will continue its focus on taming inflation, speeding up resolution of distressed projects and ensuring enough capital for banks through balance sheet clean-up.
Says consultations with the Ministry are nearing an end.
Bad loans of PSBs are at Rs 20 trillion. Most of it is, I sense, due to corruption and behest lending. Nobody pays a price for this charade. Not the promoters, the bankers, RBI officials, finance ministry bureaucrats or politicians, points out Debashis Basu.
RBI Governor Shaktikanta Das on Friday said the government and the central bank are in discussion with South Asian countries to have cross-border trade in rupee. He also said the central bank digital currency (CBDC) is in trial phase and the RBI is moving very carefully and cautiously on digital rupee launch. After the successful launch of the wholesale pilot, the Reserve Bank of India (RBI) on December 1, last year, began its retail CBDC pilot project.
In advanced economies where the financial system is more matured, the form of shadow banking is more of risk transformation through securitisation.
Bank chiefs told the RBI said they needed to mobilise deposits as they were facing additional demand for funds with other sources drying up. "When government schemes are offering 8 per cent rate, banks cannot go below that. If we cut rates further, we will not be able to attract fresh funds and will also face the prospects of depositors exiting in favour of small savings instruments," said a banker who attended the meeting.
The Reserve Bank of India wants more and more banks to launch services on mobile, its Deputy Governor Shyamala Gopinath said in Bengaluru on Monday.
Draft norms soon, but central bank worried about self-dealing by company promoters.
Basel-III norms, proposed to be implemented from the beginning of 2013 till 2017, require the equity capital of a bank to be not less than 5.5 percent of risk-weighted loans, as per the draft guidelines issued by Reserve Bank of India.
The IPO scam came to light in 2005 when the private 'Yes Bank' launched its initial public offer, which saw one Roopalben Panchal of Ahmedabad opening multiple fake demat accounts.
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 Reserve Bank of India (RBI) on Wednesday raised the benchmark lending rate by 35 basis points to 6.25 per cent in a bid to tame inflation, which has remained above its tolerance level for the past 11 months. With the latest hike, the repo rate or the short-term lending rate at which banks borrow from the central bank now has crossed 6 per cent. This is the fifth consecutive rate hike after a 40 basis points increase in May and 50 basis points hike each in June, August and September.
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The NPAs of banks stood at over Rs 3 lakh crore as on December 2014.
Pakistan has appointed Saleem Raza, a former international banker, as central bank governor.
The surge is a stark turnaround from 2013 when the country's current account gap hit a record high due to outflows on expectations the US Fed would rein in its stimulus programme
The RBI Board on Friday approved the transfer of Rs 57,128 crore as surplus to the central government for the accounting year 2019-20, the central bank said in a statement.
'We still need a certain number of large public sector banks for financial inclusion and stability purposes.'
"I think bankers have expressed some concern that they should not be held liable for actions that are taken in the full spirit of what is needed," Raghuram Rajan said.
Despite its admirable competence and proven track record, the RBI doesn't have the capacity to supervise an economy that's growing so fast and becoming larger by the year, points out T C A Srinivasa Raghavan.
Reserve Bank Governor Shaktikanta Das on Wednesday said underlying economic activity in India continues to be strong, but external factors will cause some "dent" to the economy. Speaking at the BFSI Insight Summit 2022 organised by Business Standard, Das said the RBI tracks 70 fast moving indicators and most of them are in the "green box". It is the external sector, mired by a fear of recession or clear visibility about slowing growth in a large part of the world, where the challenges lie, he said, adding that the impact of external demand will "dent" the economy.
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