Do not go for riskier options like co-operative bank only for the higher return. Even if you go for them, park only a small portion of your capital there, say Tinesh Bhasin and Sanjay Kumar Singh.
Mired in corruption, politics and with a history of suicides by its hapless depositors, PMC Bank's revival is a challenge very different from Yes Bank and LVB, both for the regulator and the rescuer, observes Tamal Bandyopadhyay.
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 decision by the Reserve Bank of India to introduce a unified regulatory framework on connected lending for all the regulated entities (RE) is expected to reduce the influence of business conglomerates in the Indian lending space, said bankers and experts. "Connected lending pertains to lending to related parties within the same business group. "While the RBI might appear more agreeable to allowing business conglomerates to own banking licenses, it deems it crucial to bolster regulations that would prevent conglomerate-owned banks from gaming the system," said Shivaji Thapliyal, head of research and lead analyst, YES Securities.
The rupee tumbled 3 per cent against the US dollar in 2024 as concerns over slower economic growth and a stronger greenback in global markets weighed, but it was among the least volatile currencies in the world and the headwinds may be less intense in the coming year.
'The dakiyas will be our partners, receiving credit proposals from micro-enterprises at the grassroots level.'
The central bank has not set a deadline for banks to conclude the stress-test exercise, but senior bankers opine that some were already looking at this, and will now fast-track it by September-end, when they will have a better picture of their books after the moratorium on the servicing of loans and a 180-day view on the performance of borrowers' accounts.
'We will be very, very proactive in providing whatever liquidity requirements are needed.'
While HDFC Bank has vowed to recoup its lost market share in the credit card segment in three to four quarters by aggressively sourcing new cards, brokerages believe it is a little hard to come by, given how competitive the landscape has become, with other players in the market becoming equally aggressive to gain market share. Kotak Institutional Equities in its report on Monday said, "We would like to believe that the recovery in market share is likely to be gradual, if any. "All the key players, including Axis Bank, are now willing to expand their credit card portfolios as they have tested quite well against Covid-19."
The Reserve Bank on Monday asked all banks and financial institutions to assess the impact on their balance sheet, asset quality, liquidity, among others, in the wake of the potential threat arising out of the spread of coronavirus disease in India. Several confirmed cases have also been detected in India, which highlight the need of a co-ordinated strategy for handling the emerging situations to protect the resilience of the Indian financial system, RBI said in a notification addressed to banks, urban cooperative banks, NBFCs, payment and small finance banks.
The department of investment and public asset management is racing against time to launch the LIC IPO, which could become the largest-ever listing on the Indian bourses. This would lead to some delay in the strategic divestment of IDBI Bank.
The Indian economy is recovering from the slowdown in momentum witnessed in the September quarter, driven by strong festival activity and a sustained upswing in rural demand, according to a Reserve Bank of India (RBI) bulletin released on Tuesday. An article on the 'State of the Economy' in the December bulletin noted that the global economy continues to exhibit resilience with steady growth and moderating inflation.
Assuming the private bank issues 20 billion shares at Rs 10 apiece (with face value of Rs 2 each), the total capital raise will be Rs 20,000 crore. And for the 49 per cent stake, SBI will need to put in about Rs 10,000 crore.
Bankers said they are looking outside the bankruptcy courts and will be able to resolve a few debts in the power sector before January-end.
At the end of March 2016, Uttar Pradesh was the most indebted state, with an outstanding liability of Rs 385,300 crore, followed by Maharashtra at Rs 351,400 crore and West Bengal at Rs 314,700 crore.
March 28 is a holiday on account of Ram Navami.
'Mumbai main branch (SBI headquarter) has all the data ready-made. It doesn't take even an hour to out the data from the system.'
These cash shortages increase banks' funding costs, making it harder for them to lower lending rates
Sensex eneded 374 points higher on rate cut expectation from the RBI.
Bad debt rules are steps in right direction.
The combined entity is set to be the third largest bank in India, behind State Bank of India and ICICI Bank.
If indeed the gate opens for big industrial houses, the RBI needs to be smarter than them and demonstrate it through action, not reaction, observes Tamal Bandyopadhyay.
RRBs were formed under an Act to provide credit to small farmers, agricultural labourers and businesses in rural areas.
India has 26 public sector banks, 22 private sector banks and 56 regional rural banks.
For the fortnight ended September 5, annual credit growth in the banking system fell to 9.68 per cent, data released by the Reserve Bank of India showed.
'What is critical today in India is confidence of depositors.' 'If you have these kinds of problems spreading like this, the confidence level of a lot of people in the system gets shaken.'
The niche banks - small finance and payments banks -have been set up to further the regulator's objective of deepening financial inclusion.
India has decided to authorise the country's biggest lender SBI to promote rupee trade with Russia and soon Moscow will name its bank to operationalise the mechanism, exporters' body FIEO said on Wednesday. The RBI in July issued a detailed circular asking banks to put in place additional arrangements for export and import transactions in Indian rupees in view of increasing interest of the global trading community in the domestic currency. Currently, a large part of bilateral trade between India and Russia is getting settled in rupee due to sanctions imposed by the US and Europe following Moscow's attack on Ukraine.
Bankers seem to be pleased with the government for keeping its promise of not interfering in operational matters, but are apprehensive about the intense scrutiny of their functioning.
'We have seen something do very well when the times are good but maybe not as well when the times are bad.'
Finance Minister Arun Jaitley said that at a time when the private sector has been somewhat conservative in investments, public investment always takes the lead.
Banks given 180-day time for NPA resolution, matter to be referred to Insolvency Board within 15 days.
'In plain simple English, these practices amount to a looting of our country's future by some in the business community, in cahoots with some lenders,' says RBI Governor Dr Urjit R Patel.
At a time when banks are engaged in a fierce battle to gain market share in the credit card segment, Citibank India has been losing its share, both in terms of outstanding cards and spends in the last few years. Still, average spends on Citi cards are higher than any other Indian bank. Last year, the global banking behemoth announced exit from its consumer banking franchises in 13 markets across Europe, Middle East and Asia, including India, citing lack of scale.
These changes will entail a relook at the various laws governing banks in the country - the two Bank Nationalisation Acts (passed in 1970 and 1980); the State Bank of India (SBI) Act of 1955; and the Companies Act of 2013.
The Reserve Bank of India (RBI) on Thursday paved the way for niche banking by issuing draft guidelines for setting up payment banks and small banks.
"The people are completely frustrated with this government. Now, people are raising their voice, they are saying that everyone (political parties) will have to come together under Congress' leadership to fight against them (BJP)," he added.
Insolvency professionals feel the bankruptcy code will deter defaulters, but NPAs will not cease unless banks are sensitised on credit appraisal and experts are hired by banks to inspect what is happening with their loans.
'The effect will be seen two-three quarters down the line.'
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