Banks enjoyed an expansion in Net Interest Margins (or NIMs) as well as in credit demand through the 2022-23 financial year (FY23). The credit expansion was because economic growth continued to recover from the Covid-19 years, and indeed, second half GDP growth surprised on the upside. The NIM expansion was because banks raised lending rates immediately (in many cases automatically due to floaters) as the Reserve Bank of India (RBI) hiked policy rates, and only started raising deposit rates late into the fiscal.
'If you keep on irritating the body by allowing all kinds of pollutants to get into it, the body cells are going to get irritated and cancer will come.'
A strong business update for the April-June quarter of the 2023-24 financial year Q1FY24 has led to a big jump of over 7 per cent in the share price of Bajaj Finance on Tuesday (July 4). The non-banking financial company's (NBFC's) new loan book grew 34 per cent with 9.9 million new loans booked in Q1FY24 from 7.2 million loans booked in Q1FY23. The company's total customer franchise rose to 72.98 million (as on June 30, 2023), compared to 60.30 million year-on-year (YoY) with the highest-ever quarterly increase of 3.84 million in Q1FY24. Assets under management (AUM) grew by 32 per cent to about Rs. 270,050 crore in Q1FY24 from Rs. 204,018 crore in Q1FY23.
Despite gold prices hitting record highs, analysts aren't gung-ho about the outlook for gold financiers Muthoot Finance and Manappuram Finance. This, they said, was due to intense competition from banks, coupled with stagnating loan books and likely pressure on margins.
The current crisis for MFIs is far worse than what they faced in 2006 when farmers' suicides resulted in a conflict with the state and MFIs had responded by reducing interest rates.
While rising interest rates and tighter liquidity are giving negative signals for the financial sector, increasing economic activity could mean higher business volumes for lenders. Liquidity in the banking system has moved from Rs 8 trillion surplus into a deficit of Rs 33,000 crore over the 2022 calendar year. By the end of November, bank credit had grown 17.5 per cent YoY (year-on-year).
Bandhan Bank is expecting that a little less than 50 per cent of its portfolio will be dominated by affordable housing loans in the next three to five years.
From zeroing in on the best means for stake dilution to moving beyond microfinance, Bandhan navigates a tough path. Namrata Acharya reports.
'India has formed tremendous resilience and still a strong growth.'
In December, Aisha Shah was named as Partnerships Manager at the White House Office of Digital Strategy.
Industry fears waiver of interest on interest would distort credit culture, may encourage borrowers who can pay to defer repayment.
Investors are shying away from securitised loans of micro-finance institutions (MFIs), as the ordinance issued by the Andhra Pradesh government has slowed recoveries, creating uncertainty around the underlying portfolio.
There has been a "sharp decline" in collection efficiencies in retail asset pools across asset classes in May due to the second wave of the pandemic, with microlenders witnessing a dip of up to 20 per cent, a report said on Monday. "ICRA has observed a sharp decline in the collections of its rated securitisation transactions in April 2021 (i.e. May 2021 payouts), following the rise of COVID-19 cases and imposition of lockdowns/movement restrictions which has impacted the operations and collection activities of the NBFCs and HFCs," the report from domestic rating agency ICRA said. A major part of the country was undergoing localised lockdowns till May-end in the second wave, which saw new cases top 4.14 lakh and resulted in over 4,500 deaths daily at its peak.
TAI has undertaken some extraordinary work to help rehabilitate sex workers and transgenders so that they can live a life of dignity and honour.
S&P Global Ratings on Wednesday said Indian banks face a systemic risk as the second COVID wave will impair the performance of financial institutions in the April-September period. Stating that economic recovery remains highly vulnerable to setbacks due to COVID, particularly if fresh outbreaks trigger new lockdowns, S&P said the banking sector's weak loans will likely remain elevated at 11-12 per cent of gross loans in the next 12 to 18 months. "The second wave has front-ended weakness in asset quality," said S&P Global Ratings Credit Analyst Deepali Seth Chhabria. "Financial institutions face a strained first half amid weak collections and poor disbursements."
India's largest IT-ITeS company, Tata Consultancy Services (TCS), is all set to launch its smart card solution that would enable banks to reach the remote areas and address their need for microfinancing.
According to industry estimates more than 70 per cent of motorcycles are bought through financing schemes.
The Navi lending app, launched in May, provides instant loans of up to Rs 5 lakh, with repayment tenures of up to 36 months.
Microfinance portfolio of SFBs saw a muted growth of about 3% last year
RBL Bank is no Yes Bank. It's not fraught with fraud. It's a story of limitless ambition and greed for growth under a leader who doesn't want to give up, says Tamal Bandyopadhyay.
In 2012, Akula quit as chairman of Bharat Financial Inclusion (formerly SKS Microfinance), which he'd founded and led to a successful initial public offering
Renowned women's rights activist and founder of the Self Employed Women's Association (SEWA) Ela Bhatt passed away in Ahmedabad on Wednesday due to age-related ailments, her associates said.
Every political party loves to use the bait of loan waiver to woo the electorate. If their hearts bleed for the poor, they can always use the party funds to pay off the lenders, suggests Tamal Bandyopadhyay.
Starting your investment early with more risk appetite will give the investor a better chance of growing the money.
In December 2016, RBI had granted additional 60 days for repayment of certain loans
'No one in Sri Lanka could afford to stay at home, everyone came onto the street.'
'The money is readily available to the depositors.'
Activists created a climate of opinion against MFIs, while politicians capitalised on the frenzy.
Microfinance companies have been facing a crisis after a crackdown by the Andhra Pradesh government last year in response to allegations they were charging high rates and using coercive recovery practices.
IFMR Capital previously pioneered the multi-originator securitisation.
Biksham Gujja contributed to major global initiatives such as the World Commission on Dams, World Water Commission and World Water Forum.
All the existing microfinance businesses of the company and clients will be transferred to the bank
For the chief minister and Assam alike, the road ahead is full of challenges, notes Aditi Phadnis.
To further strengthen the supervision on non-banking entities (NBFCs), the Reserve Bank on Tuesday issued revised guidelines on a Prompt Corrective Action (PCA) framework for such companies, excluding government-owned ones, effective from October 1, 2022, on the lines of what it had introduced for banks in 2002. The RBI came up with stricter supervisory norms under the PCA framework for banks after their bad loans mounted and balance-sheets bled badly. This involved restricting them from fresh lending, brand opening and, hiring, among others. The RBI said the revised PCA framework is also applicable to all deposit-taking non-banking financial companies (NBFCs), all non-deposit taking NBFCs in the middle, upper and top layers, including investment and credit companies, core investment companies, infrastructure debt funds, infrastructure finance companies and microfinance institutions.
The two-wheeler sector has been underperforming its peers on the volumes front for over five quarters now. Even in the March quarter, Bajaj Auto and Hero MotoCorp posted a 17-24 per cent YoY decline in volumes, the sharpest in the listed auto universe. The ongoing impact of frequent price hikes, all-time high fuel prices, and muted rural sentiment has led to the lacklustre showing by two-wheeler makers. What has aggravated the situation for two-wheeler companies, which get almost all their sales from the internal combustion engine or ICE-based units, is the traction for electric two-wheelers (EV).
The party is less forthcoming about who the chief minister will be if it stays in power.
C S Ghosh, founder of Bandhan Bank, believes his unique business model is not comparable to any financial institution in India -- neither small finance banks, nor big private sector banks -- and hence the valuations are justified.
Dr Tara Thiagarajan is the chairperson and managing director of the Rs 200-crore (Rs 2 billion) Madura Micro Finance Ltd. She is also the director of Microcredit Foundation of India.
The storyline pretty much resembles that of Apple co-founder Steve Jobs, who was fired from the company in 1985.
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