Asset quality of banks, which saw some improvement in the second half of 2020, is likely to worsen during the first six months of 2021, according to a survey. The findings are part of the 12th round of bankers' survey carried out by FICCI-IBA between July and December 2020. The survey was conducted on 20 banks, including public sector, private sector and foreign banks, representing about 59 per cent of the banking industry, as classified by asset size.
Embattled retailer Future Retail Ltd (FRL) on Tuesday moved the Supreme Court to avert insolvency proceedings over missing a loan repayment deadline, even as its independent directors rejected an Amazon-supported offer to sell the company businesses at less than a third of what Mukesh Ambani's Reliance is offering. India's second-largest retailer, which operates multi-brand retail chains such as Big Bazaar, Easyday and Heritage, failed to pay Rs 3,494.56 crore to lenders by the due date of December-end and sought a 30-day grace period to resolve the situation. Unable to find money, it moved the apex court seeking to restrain its lenders from declaring the company a defaulter, which can invite initiation of insolvency proceedings.
Vodafone Idea (Vi) lost 12.4 million subscribers in the first quarter of FY22, the most since the fourth quarter of FY20, as the second wave of Covid hurt its operational and financial performance. Vi had managed to trim subscriber losses in the third and fourth quarters of FY21. However, it lost 12.4 million subscribers and its customer base shrunk to 255.4 million in the first quarter of FY22. Sequential fall in 4G users was modest, indicating that most of the loss was in the low-margin 2G segment.
Amid an increase in localised lockdowns across the country, Reserve Bank Governor Shaktikanta Das on Wednesday said there is no need for a loan repayments moratorium at present, stating that businesses are better prepared to face the situation. It can be noted that the RBI had announced a six-month moratorium in the early days of the national lockdown last year to help borrowers impacted by a chilling in economic activity. The entire state of Maharashtra is in a lockdown for non-essential services and localised and night lockdowns are being observed in many pockets of the country, including the national capital, to restrict the surge in cases.
The Indian economy is rapidly normalising towards pre-pandemic activity levels, even as uncertainty exists about coronavirus mutations and repeated infection waves, industrialist Kumar Mangalam Birla said on Wednesday. Vaccination is picking up pace, which would improve India's resilience against a potential third wave, the chairman of Aditya Birla Group said while virtually addressing shareholders at the AGM of group firm UltraTech Cement Ltd. Moreover, various steps taken by the RBI and the government have helped in containing the economic disruptions of the pandemic, Birla added.
Rogue lending under political influence was rife in the Congress-led regime and is not happening in the Modi regime, certainly not on that scale. But if PSBs cannot lend as indiscriminately as they did last time in the name of 'credit expansion', how well will these banks do, asks Debashis Basu.
The proposed reorganisation plan by Reliance Industries Ltd to transfer its refining, marketing and petrochemical (oil-to-chemicals) businesses to a wholly-owned subsidiary is a step towards facilitating participation by strategic investors in the unit, Fitch Ratings said on Tuesday. The reorganisation of the business in Reliance O2C Limited (O2C) "will have a neutral impact on RIL's credit metrics and rating," it said in a statement. The transfer will be on a "slump sale basis", subject to attaining the requisite approvals.
It said the searches that were launched on July 22 in nine cities like Bhopal, Indore, Delhi, Ahmedabad, Noida and some others are "continuing and further investigations are in progress."
The chairman of mortgage giant HDFC Ltd in his annual letter to shareholders, also suggested a one-time restructuring of real estate loans, easing of external commercial borrowing rules and immediate changes in regulations to allow end-to-end execution of housing loans online.
In such frauds customers get calls asking them to share their OTP in order to postpone their loan EMIs. Once the OTP is shared the amount is immediately siphoned away by fraudsters.
The new rates vary from 8.80 to 9.05 per cent on various slabs of loans.
Financial markets are under stress and require steps by the central bank for market stability and revival of economic growth, he said while announcing the decisions taken by the Monetary Policy Committee in Mumbai.
The root of the problem, according to industry officials, is the sudden stoppage of lines of credit to tea plantation companies.
With average capacity utilisation now touching 76 per cent, Indian companies are going back to the drawing board to add capacity but the plans to build new factories and plants are still some months away.
The Supreme Court has refused to interfere with the government and RBI's loan moratorium policy, and declined to extend the six-month loan moratorium period.
State governments, which are striving to achieve 4 per cent growth in agriculture during the 11th Plan period (2007-12), have made a strong pitch for repayment of short-term loans by farmers in case of natural calamities at an interest rate of 7 per cent and not at the regular rate of over 10 per cent as fixed by banks.
'I hope the trend is sustainable and that economic activity accelerates going forward.'
With liquidity crunch hitting operations, many finance companies have put the brakes on sanctions in the third quarter in the aftermath of the IL&FS crisis.
On average, an account-holder among Punjab farmers availed of crop loans of around Rs 2.23 lakh in the first 11 months of 2016-17.
Reliance Industries Ltd's focus on the next hypergrowth opportunities in clean tech and its path to decarbonisation has the potential to spur re-rating, raises clarity on investment cycles and reduces investor worry, brokerages said. RIL chairman Mukesh Ambani at the company's 'Green AGM' on Thursday committed Rs 75,000 crore over the next three years to set up an integrated Green Energy Giga Complex across 5,000 acres in Jamnagar, Gujarat which will contain four giga factories. The complex, which would be one of the world's largest renewable manufacturing facilities, would have an integrated solar photovoltaic module factory, an energy storage battery factory, electrolyser manufacturing for hydrogen production, and manufacturing of fuel cells so that hydrogen can be used in transportation.
Scores of employees took to social media to express disappointment and said they were asked to resign over WhatsApp calls. On Twitter, some said they had been asked to resign by May 31 and that there was no severance package and salary would be paid only for May.
Nehal, 41, is charged in a New York Supreme Court indictment with Grand Larceny in the First Degree, Manhattan District Attorney Cy Vance, Jr. said.
Banks have started putting the brakes on short-term corporate loans.
'Common sense says if one can afford, servicing the loans during this period is a better bet than postponing it by three months,' says Tamal Bandyopadhyay.
In his statement to the Enforcement Directorate, Dhoot conceded that Rs 64 crore had been transferred to Deepak Kochhar's NuPower Renewables through a web of entities to allegedly acquire wind farm properties.
Industry fears waiver of interest on interest would distort credit culture, may encourage borrowers who can pay to defer repayment.
Even as you fight the ongoing health challenge, here are some tips to strengthen your personal finance in the time of coronavirus.
In first half of year, firms raise more than banks on low US treasury rates.
Move can also bring a huge change in the way business is done in India, where firms use multiple current accounts, often for even individual projects, making them difficult to monitor.
The ED, early this year, also attached assets worth Rs 78 crore "in possession of" Chanda Kochhar, Deepak Kochhar and the companies owned and controlled by him.
While banks are not as exposed as the corporate sector during the initial stage of the pandemic, the strain on lenders could ultimately be profound. Banks face a second-order hit compared with the corporate and household sectors.
The Reserve Bank on Monday eased norms for structuring of existing long-term project loans to infrastructure and core industries, to revive stalled plans and help banks tide over mounting bad loans.
The RBI on Wednesday provided more time to exporters to collect payment of goods and software sold to overseas buyers and repatriate that to India, as the central bank announced more measures to deal with the economic fallout of the Covid-19 pandemic. The central bank has also decided to increase the limit of advances it gives to states and UTs by 30 per cent under the Ways and Means (WMA).
The Centre informed the Supreme Court on Monday that a decision is likely in 2-3 days over charging of interest by banks on instalments which were deferred during the moratorium period in view of the Covid-19 pandemic.
Bajaj Finance was the biggest loser in the Sensex pack, tanking up to 8 per cent, followed by Hero MotoCorp, IndusInd Bank, Maruti and HCL Tech. Axis Bank, ITC, NTPC and M&M were among the top gainers.
Real estate development on Mumbai airport land and the work on Navi Mumbai airport have been inordinately delayed, which have prompted rating downgrades and raised questions on its financial capabilities. It is also trying to stave off Adani group's entry as a shareholder in the Mumbai airport project.
'Now is the time for India to course correct and for the government also to course correct,' says businessman Mangesh Khatri.
In its annual policy review on April 1, the central bank had proposed a ban on prepayment penalties.
Experts say the focus is on preserving liquidity as there is uncertainty over the duration and impact of the 21-day nationwide lockdown imposed to check the spread of COVID-19.
The searches are in connection with alleged violation of foreign direct investment norms that is linked to an earlier case of revocation of Foreign Contribution (Regulation) Act licence of the NGO by the Union home ministry in 2010, the ED said.
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