WWW Eenadupratibha Net Pratibha OnlineDesk CA Eng Banking Au

Today's Mortgage Rates 30-Year Fixed 3.38% 3.
38% APR
3.17% APR 15-Year Fixed 2.75% 2.75% APR

ARM
HOME
2016
AUGUST
BANKING - 2016 AUGUST
August 1
SBI unveils cheaper home loans to tap into 7th Pay Commission bonanza.
State Bank of India has unveiled a new home loan scheme targeted at beneficiaries
of the seventh pay commission recommendations.
The loan can be repaid till the beneficiary attains 75 years of age as against 70
years offered under other schemes.
SBI will offer two new home loan products 'SBI Privilege Home Loan' for government
employees and 'SBI Shaurya Home Loan' for defence personnel without any
processing fee.
SBI has also waived the entire processing fee for home loans under this scheme.
RBI releases Guidelines for 'on tap' Licensing of Universal Banks in the
Private Sector.
Some of the key aspects of the Guidelines include
(1) The initial minimum paid-up voting equity capital for a bank shall be Rs. 500 cr
and shall have a minimum net worth of Rs. 500 cr at all times.
(2) Resident individuals and professionals having 10 years of experience in banking
open in browser PRO version Are you a developer? Try out the HTML to PDF API pdfcrowd.com
and finance at a senior level are also eligible to promote universal banks
(3) Large industrial houses are excluded as eligible entities but are permitted to
invest in the banks up to 10 per cent.
(4) Non-Operative Financial Holding Company (NOFHC) has been made non-
mandatory in case of promoters being individuals or standalone promoting/ converting
entities who/ which do not have other group entities
(5) Not less than 51 per cent of the total paid-up equity capital of the NOFHC shall
be owned by the promoter/promoter group, instead being wholly owned by the
promoter group
(6) Existing specialized activities have been permitted to be continued from a
separate entity proposed to be held under the NOFHC subject to prior approval from
the Reserve Bank and subject to it being ensured that similar activities are not
conducted through the bank as well.
(7) Bank shall open at least 25 per cent of its branches in unbanked rural centres
and should comply with the priority sector lending targets and sub-targets as
applicable to the existing domestic scheduled commercial banks.
(8) Foreign shareholding in the bank would be as per the existing foreign direct
investment policy subject to the minimum promoter shareholding requirement (74%).
(9) Bank shall get its shares listed on the stock exchanges within six years of the
commencement of business by the bank
ICICI Bank reduces MCLR by 0.05%.
ICICI Bank announced a 0.05 per cent reduction in its marginal cost of funds based
lending rate (MCLR).
The RBI introduced the MCLR from April 1 this year for faster transmission of its
policy actions into actual lending rates by the banks. Lenders are given the leeway to
review their MCLR once in a month and it is the hope of the RBI that the competition
will help them act faster.
MCLR will be 8.90% under the revised rate structure and one-year MCLR, to which
the home loans are linked, has moved down to 9.10%.
MCLR replaced the base rate system and so far the banks have been very quick to
react to competitive forces in making marginal rate adjustments.
World Bank gives $100 million for Sri Lankas economic reforms.
The World Bank has approved a $100 million credit from the International
Development Association (IDA) to support the Sri Lanka's economic reforms
programme.
With the economic reforms government aiming to create one million new jobs
through a reform package focused on improving the countrys competitiveness,
transparency and macroeconomic stability.
Exim Bank raises $1 billion from overseas bonds.
Export-Import Bank (Exim Bank) has raised $1 billion via a 10-year bond issue at a
coupon rate of 3.375 per cent.
The funds raised will be used by the Bank to support Indian project exports,
overseas investments by way of long-term credit and its lines of credit portfolio.
The largest issuance ever for Exim Bank and also the largest single tranche
issuance out of India in 2016.
August 2
Bank of Baroda ties up with start-up Fisdom.
Bank of Baroda has tied up with a fintech start-up Fisdom for personal wealth
management services.
Fisdom app helps users make financial investments in an easy and paperless
manner by blending cutting-edge technology with personalised financial advice. It
helps people manage their money with the help of a robo-advisor.
Bank has entered into pact with six other fintech copnanies - CreditMantri,
FundsTiger, Probe42, Power2SME, IndiaLends and KredX .
SBI Starts Certification For Officers Who Sanction Loans.
State Bank of India has started working on a multi-pronged strategy, including a
certification programme for loan sanctioning officials.
The main aim of the program toface the challenge of high non-performing assets
(NPAs).
As per the plan which will come in force over next three years, the officials who
successfully complete the first learning will be authorised to sanction loan up to Rs.
50 crore and those who pass level two exam, will be given powers to sanction loan up
to Rs. 500 crore.
Every concerned bank official will have to pass three levels of exams before being
allowed to sanction loans. The process includes self-learning, class-room learning and
examination.
August 3
Public sector banks need Rs. 2.5 lakh crore capital over 3 years: S&P Global
Ratings.
International rating agency S&P Global Ratings stated that Indian state-run banks
will need Rs. 2.5 lakh crore capital infusion over the next three years to meet Basel-
III requirements.
The banks will be reporting non - performing assets of around 8.5 per cent.
The overall stress stands at up to 13 per cent and the troubles surrounding NPAs
will continue at least for a year.
Canara, HSBC, Oriental Bank of Commerce Life Insurance iNVESTSHIELD.
Canara HSBC Oriental Bank of Commerce Life Insurance has launched a new linked
insurance product 'iNVESTSHIELD' that aims to protect and meet an individual's
present and future financial needs.
Online linked plan with 'Premium Funding' option whereby in the event of the life
insureds death in addition to the immediate benefit payout the insurer funds the
remaining premiums for the remaining policy term and the fund value is also paid on
maturity.
August 4
RBI Governor launches Website 'Sachet' to curb Illegal Collection of
Deposits.
Reserve Bank of India launched a website to curb illegal and unauthorised pooling
of funds by unscrupulous firms and which will help people obtain information about
entities allowed to collect deposits.
The portal will facilitate filing, tracking of complaints, besides providing information
about entities registered with a regulator and is permitted to accept deposits.
The website would also help enhance coordination among regulators and state
government agencies and thus be useful in curbing instances of unauthorized
acceptance of deposits by unscrupulous entities.
It also incorporates regulations prescribed by all financial regulators that different
entities have to follow.
The website also has a section for closed user group for State Level Coordination
Committee (SLCCs) wherein they could share market intelligence and other
information about their activities as well as agenda and minutes of meetings across
the country on a real time basis.
RBI constitutes a Committee on Household Finance.
Reserve Bank of India (RBI) has set up a committee to look at the various facets of
household finance in India and to benchmark Indias position both the peer countries
and advanced countries.
The committee will analyse household financial markets in India with other major
world markets to identify areas of priority for growth and change.
The Committee will be chaired by Dr. Tarun Ramadorai, Professor of Financial
Economics, University of Oxford and will have representation from Securities and
Exchange Board of India (SEBI), Insurance Regulatory and Development Authority of
India (IRDAI), Pension Fund Regulatory and Development Authority (PFRDA) apart
from Reserve Bank of India (RBI).
Committee is expected to submit its report by end July 2017.
SBI to offer overdrafts, loans to 7 lakh Jan Dhan account-holders.
State Bank of India, will offer overdraft and loan facilities to nearly seven lakh
account-holders who have enrolled with it through the Pradhan Mantri Jan Dhan
Yojna (PMJDY).
Under the PMJDY scheme, the public sector bank has opened 10 crore accounts.
Seven lakh loans (taking overdraft) will be provided for personal purposes not for
entrepreneurship. People who are belonging to low-income group and have opened
accounts under PMJDY are eligible for such loans.
RBI imposes penalty on 2 Chhattisgarh cooperative banks.
RBI imposed penalty on two cooperative banks in Chhattisgarh under the Banking
Regulation Act, 1949.
Imposed a monetary penalty of five lakh each on Zila Sahakari Kendriya Bank
Maryadit, Raipur, and Raipur Urban Mercantile Cooperative Bank Limited.
Penalized for violation of the directives/ guidelines of the Central Bank on Know
Your Customer norms.
August 5
Corporation Bank launches group insurance scheme.
Corporation Bank launched 'group credit life insurance scheme' of LIC of India in
Mangalore.
The scheme has been made available initially at all the branches of Mangaluru
zone. It will later be extended to all the branches of the bank.
The scheme is available to customers in the age group of 18-60 years who have
taken term loan from the bank.
It is a single premium group term insurance plan offering insurance cover to the
loan taken by the customer, in the event of death of the borrower. The scheme
covers various term loans, including retail loans and loans to MSME and agriculture.
Bank of England cuts interest rates to 0.25% and expands QE.
Bank of England cut interest rates for the 1st time in more than seven years and
warned high-street lenders to pass on cheaper borrowing costs to customers, in a
bigger-than-expected package of measures designed to prevent a post-Brexit
recession.
Interest rates to a new record low of 0.25% from 0.5% and signalled they would
be reduced further in coming months as the economic fallout.
Banks monetary policy committee unveils a four-point plan to mitigate the impact
of the EU referendum vote.
August 6
PFRDA asks States to support Atal Pension Yojana.
To attract more subscribers to the Atal Pension Yojana (APY), the pension
regulator has sought the support of State governments to expand the schemes
reach.
The Pension Fund Regulatory and Development Authority (PFRDA) has now
requested State governments to consider registering the unorganized workforce
attached with State departments.
These could include anganwadi and ASHA workers, construction/ agriculture
workers and those under the Mahatma Gandhi National Rural Employment Guarantee
Scheme (MGNREGA).
States, including Andhra Pradesh, Gujarat and Himachal Pradesh, have already
notified APY and are co-contributing Rs. 5001,000 a year for eligible subscribers of
the State.
Karnataka Bank launches new app.
Karnataka Bank has launched mobile app 'KBL POS Manager' for its point-of-sale
(POS) merchant establishments.
Store sales can be viewed and monitored from anywhere.
App gives flexibility to merchants to manage their store sales using their
smartphones.
August 7
IDBI Bank to raise Rs. 4,000 crore via tier II, infra bonds.
IDBI Bank plans to raise Rs. 2,000 crore through infrastructure bonds and a similar
amount through Basel III-compliant tier-II bonds.
Rating agency CRISIL has assigned ''AA/Negative'' rating for both instruments.
Money raised from infrastructure bonds will be used to finance road projects,
renewable energy and affordable housing.
Karnataka Bank to come out with 1:2 rights issue.
Karnataka Bank has decided to issue equity shares on rights basis to its
shareholders.
The bank informed the BSE to issue equity shares on rights basis in the ratio 1:2.
One share for every two shares held on the record date at a price of Rs. 70 a
share (including premium of Rs. 60 a share) subject to necessary approvals.
August 8
Syndicate Bank launches new products.
Syndicate Bank, launched fund transfer based on 'Aadhaar Number through NUUP',
using an ordinary mobile phone without internet connection.
Bank also launched Fund Transfer through IMPS at any branch for instantaneous
credit to any bank account.
ICICI Bank aims facilitating 3 million transactions through e-toll plazas by
March 2017.
ICICI Bank is aiming to facilitate three million transactions through its inter-
operable electronic toll collection facility on national highways by March 2017.
Electronic toll collection (ETC) enables vehicles to pay highway tolls electronically
without stopping at toll plazas.
First bank to have rolled out the facility is also planning to issue 400,000 tags to
motorists to allow them a hassle-free passage through toll plazas on the national
highways.
ETC tags enhance convenience for motorists to avoid congestion at toll booths as
drivers don't have to stop and pay the fee, saving their time.
August 9
Reserve Bank of India keeps interest rate unchanged at 6.5% in policy
review.
Reserve Bank of India (RBI) kept the policy rate unchanged at 6.50 per cent, even
as inflation has hit a near two-year high and continues to be above the comfort
zone.
Repo rate unchanged at 6.5%
Cash Reserve Ratio (CRR) unchanged at 4%.
Reverse repo rate remains unchanged at 6.0%
Marginal standing facility (MSF) rate is 7.0%
Bank Rate is at 7.0%
HDFC Life, Max Life merger to create entity with Rs. 65,000 crore valuation.
HDFC Standard Life Insurance Company and the Max group entities have finalized
the merger of Max insurance arm with the former, creating the largest private sector
insurance company with a market valuation of Rs. 65,000 crore.
Max Financial Services shareholders will get seven shares of HDFC Life for every
three shares of Max Financial.
HDFC ERGO to cover political risks of firms operating abroad.
HDFC ERGO General Insurance Company has launched a political risk insurance
policy, whereby companies operating internationally will be protected against arbitrary
government actions and their investments protected.
The policy will also safeguard businesses against unfavorable currency
inconvertibility.
Policy is designed to protect investors' investments in overseas markets against
unpredictable losses due to specified political perils such as expropriation, selective
discrimination, forced abandonment, forced divestiture, political violence and currency
inconvertibility, it added. Political risk insurance is available to investors, lenders,
contractors, exporters, and other similar entities for safeguarding their foreign assets
or investments.
August 10
RBI to inject Rs. 10,000 crore for liquidity crunch on FCNR payout.
In a bid to meet the perceived liquidity crunch due to upcoming redemption of $20
billion, RBI announced pumping Rs. 10,000 crore by buying government securities.
Based on the current assessment of prevailing and evolving liquidity conditions, the
Reserve Bank has decided to conduct purchase of Government securities under Open
Market Operations for an aggregate amount of Rs. 10,000 crore on August 11 through
multi-security auction using the multiple price method.
NABARD sanctions Rs. 26.06 crore to Punjab government.
National Bank for Agriculture and Rural Development (NABARD) has sanctioned Rs.
26.06 crore to the Punjab government.
The fund has been sanctioned for tackling waterlogging by constructing lift
schemes in low-lying areas, village ponds and other allied works.
Project will reclaim 5,913 hectares of land in 87 villages of Muktsar and Fazilka
districts.
With this, the total sanctions to the Punjab government under the Rural
Infrastructure Development Fund (RIDF), since its inception, stood at Rs. 7,826.17
crore.
NPA of commercial banks increased by around 4%.
Union Government has announced that the Non-Performing Assets (NPA) of
commercial banks have increased by around 4% in the last one year (March 2015 to
March 2016)
NPA of banks was 5.43 per cent in March 2015 which has risen to 9.32 per cent in
March 2016.
August 11
Syndicate Bank undertakes modernisation through ''Project Ananya''.
Syndicate Bank with "Project Ananya" has embarked on a large-scale
transformation of its branches.
Project would provide customers with best services while improving and
modernising the whole bank.
The bank plans to transform 10 per cent of its branches to the new format in the
next 6-12 months.
A completely operational account is available in less than 1 day with no additional
visits to the branch and making this one of the fastest account opening processes in
the industry.
MSME Databank and Finance Facilitation Launched at 14th Meeting of
National Board.
Arun Jaitley, Union Minister of Finance & Corporate Affairs launched two important
initiatives of the Ministry of MSME, viz. MSME Databank Portal and Online Finance
Facilitation Web Portal on the sidelines of 14th Meeting of the National Board of
MSME.
Portal aims to gather information about micro, small and medium enterprises.
Online Finance Facilitation Web Portal was also launched to provide collective
funding options for MSMEs.
Six Online Finance Facilitation Centres in Jalandhar, Ludhiana, Guwahati, Lucknow,
Peenya near Bengaluru and Delhi have been opened and six more will be unveiled in
the near future.
August 12
Certification Must For Bank Staff Selling Retail Products: RBI.
A Reserve Bank of India (RBI) committee has recommended that banks should
identify specialized areas for certification of staff manning key responsibilities.
Bank employees involved in marketing third party retail products and wealth
management services "must necessarily undergo" an appropriate certification process
to check miss-selling and minimize customer complaints.
Banks should make acquiring of a certificate course mandatory for areas like
treasury operations, including dealers, mid-office operations, risk management like
credit risk, market risk and accounting, including preparation of financial results, audit
function and credit management including credit appraisal, rating, monitoring and
credit administration.
RBI had constituted a Committee on Capacity Building in July 2014, under the
chairmanship of former executive director, G. Gopalakrishna.
RBI transfers Rs. 65,876 crore surplus to government.
Reserve Bank will transfer to the central government its surplus profit of Rs. 65,876
crore which is marginally lower than the amount given last year.
The approval to transfer the surplus was taken at the 559th meeting of the Central
Board of the RBI, chaired by Governor Raghuram Rajan.
Flipkart Now On Kotak Mahindra Banks Mobile Banking App.
Kotak Mahindra Bank (KMB), announced the availability of Flipkarts mobile site in
its mobile banking app, which gives the customer a secure in-app shopping
environment.
KMB has been expanding the scope of offerings on its mobile banking app, and this
move further strengthens its mStore which already allows booking of air tickets,
hotels and bus tickets.
SBI and Korea Development Bank ties up for Business Development.
State bank of India (SBI) and Korea Development Bank (KDB) have signed an MOU
to develop business synergies in the domains of corporate finance, project finance
and asset finance.
Asset finance includes trade finance, cash management products, syndicated
loans, infrastructure/real estate financing, capital markets, securitisation, derivatives
and risk management, financial advisory services and acquisition finance.
MoU To enable a smooth cooperation and draw the full benefit from the MoU, both
the banks will work on the establishment of a korea desk in India.
KDB is providing funding facility to SBI through credit lines and/or money market
lines, as per terms agreed between the two banks.
August 13
UBI launches USSD based mobile app for basic banking needs with NPC.
Union Bank of India (UBI) has launch an Unstructured Supplementary Service Data
(USSD) based *99# mobile application for their customers for basic banking needs.
It was launched in partnership with National Payments Corporation of India (NPCI),
the umbrella organization for all retail payments system in the country.
It can be used even without any internet connection as it does not require any
data and is available in 10 languages.
RBIs Draft for Limiting Liability of Customers in Unauthorized Electronic
Banking Transactions.
RBI has come up with a Draft Circular for public comments on ''Limited Liability'' for
customers in case of frauds in Internet Banking and Card transactions.
RBI has also proposed zero liability on the customer if the loss is reported within
three working days even if the cause is not directly linked to deficiency on the part
of the lender and the fault lies elsewhere in the system.
Zero Liability of a Customer - A customers entitlement to zero liability shall arise
where the security architecture and systems of the bank for electronic banking
transactions are not able to protect the customer in the following events.
Third party breach where the fault lies neither with the bank nor with the customer
but lies elsewhere in the system, and the customer notifies the bank within three
working days of receiving the communication from the bank regarding an unauthorized
transaction
Times Internet partners HDFC Bank to launch co-branded Debit Card.
Times of India Groups Times Internet in cooperation with HDFC launched co-
branded debit cards. It will have a daily shopping limit of Rs. 2.75 lakh and an ATM
withdrawal limit of Rs. 1 lakh.
The second co-branded card launched by Times Internet with HDFC Bank, back in
2013 both the majors jointly launched Credit card focused on Entertainment segment.
Times Points HDFC Bank Debit Card will offer at least 10 per cent discount on
online shopping on retail, groceries and dining space and also offers reward them for
engaging with the Times Internet sites.
August 14
RBI may not meet inflation target: IMF.
An IMF paper has raised question marks over the ability of the Reserve Bank of
India (RBI) to target inflation through monetary measures, saying the size of the
formal financial sector is small in India and may undermine the effectiveness of
interest rate changes on aggregate demand.
IMF working paper assumes significance as the RBI has recently implemented an
inflation-targeting regime that requires it to hit publicly announced targets for retail
inflation, based on Consumer Price Index (CPI).
Under the new dispensation, RBI will be required to meet retail inflation target of 4
per cent, plus or minus two per cent over the next five years.
The interest rate from the next policy, due on October 4, will be decided by a six-
member monetary policy committee (MPC) instead of the central bank governor.
Kotak Mahindra Bank starts Innovation Lab, open to investing in startups.
Kotak Mahindra Bank has started an 'Innovation Lab' in Bengaluru to tap into the
best technology that impacts its operations, and is open to investing in startups.
Bank has put together a seven-member core team which is working with an equal
number of startups in the artificial intelligence, analytics, biometric or iris scanning
and machine learning space.
Initiatives being undertaken by them include launching dedicated funds to invest in
startups, starting incubation centres, organizing 'hackathons' and ideation contests.
August 15
South Indian Bank, SBI Card to launch co-branded credit card.
South Indian Bank and SBI Card, a credit card issuer has announced their
collaboration to launch co-branded credit cards for the customers of South Indian
Bank.
South Indian Bank and SBI Card will launch two variants of credit card on VISA
platform, namely South Indian Bank Platinum SBI card and South Indian Bank
SimplySave SBI card.
South Indian Bank Platinum SBI card has been designed keeping in mind the
premium customers and offers features in line with their lifestyle habits.
South Indian Bank SimplySave SBI card is aimed at the value conscious consumers.
It offers rewards and features that take into account the spending requirements of
customers who want accelerated rewards from their credit card.
IRDAI Slaps Rs. 35 Lakh Fine On Bharti AXA General Insurance.
IRDAI has imposed Rs. 35 lakh fine on Bharti AXA General Insurance Co Ltd for
violation of various norms including outsourcing activities and corporate governance
guidelines.
The fine is based on violation related with an inspection finding during December
2012 to March 2013.
August 16
RBI questions banks for lending Rs. 5,262 crore to REI Agro.
RBI has questioned the decision of a 21 bank consortium led by UCO Bank to
extend a staggering Rs. 5,262 crore loan to Kolkata based rice trading firm REI Agro
which was found to be involved in fraudulent activities.
As many as 21 banks had extended loan of Rs. 5,262 crore to REI Agro Ltd, a
basmati rice trading firm, and the RBI has sought a detailed clarification from these
banks after the fraud was detected.
The clarifications were sought in the light of RBI's master circular on fraud. Out of
21 banks, 20 banks reported the account as fraud and one bank had sold the
account to Asset Reconstruction Company.
As per the RBI master circular on frauds, banks are required to put in place a
framework for loan frauds directing early detection and necessary corrective action
by introducing Early Warning Signals (EWS) and Red Flagged Accounts (RFA) for loan
of Rs. 50 core or more.
Offline banking apps push inclusion.
Offline banking is gaining more ground with financial inclusion. To help rural and
under-privileged customers, who don't have internet connectivity, banks such as
Kotak Mahindra Bank and DCB Bank have introduced mobile banking apps that can be
used both online and offline.
With the Kotak Bharat app can transfer up to Rs. 2500 a day in one transaction
from their savings, current accounts or even credit cards.
With the Kotak Bharat app, users can transfer money, recharge their mobile or
DTH, link Aadhaar number to the bank account, locate nearby Kotak ATMs and
branches and also buy insurance coverage under the PradhanMantri Suraksha Bima
Yojana and Pradhan MantriJeevanJyoti Bima Yojana schemes.
At DCB Bank, customers can enquire about their account balance, generate a mini
statement, request a cheque book and e-mail statement.
August 17
IOB to conduct EGM to allot shares worth Rs. 1,551 crore to GoI.
Indian Overseas Bank will be conducting an Extraordinary General Meeting (EGM) of
shareholders of the Bank on September 15 to issue equity shares to the Government
of India to raise Rs. 1,551 crore, as part of Centre's plans to infuse funds into the
public sector lender.
The central government has recently announced an allocation of Rs. 3,101 crore
by way of preferential allotment of equity to the bank, which is struggling with high
non-performing assets (NPA).
Almost 50 per cent of this amount, Rs. 1,551 crore, is marked for immediate
infusion, which would help the Bank to keep its capital adequacy ratio within the
limits.
RBI imposes penalty on four cooperative banks.
Monetary penalty of Rs. 5 lakh on The Cooperative City Bank, Guwahati, for
flouting KYC norms and non-adherence to requirements relating to identification and
reporting of suspicious transactions.
Penalty of Rs. 2 lakh imposed on Indapur Urban Cooperative Bank, Indapur, District
Pune, for violations of norms related to KYC/anti-money laundering and credit
exposure norms on loans.
Penalty of Rs. 1 lakh on Shri Dadasaheb Gajmal Cooperative Bank, Pachora, District
Jalgaon for violation of norms relating to creation of floating charge on its assets
without the prior permission.
Penalty of Rs. 1 lakh on The Model Cooperative Urban Bank, Hyderabad, Telangana
for violation directives and guidelines on loans and advances to directors and their
relatives.
Federal Bank joins hand with MMTC for the distribution of IGC Indian Gold
Coins.
Federal Bank ties up with MMTC for distribution of Indian Gold Coins, the first-Ever
National Gold offering by the Government, which was launched by Prime Minister
Narendra Modi.
Federal Bank has become the first private sector bank to start distributing gold
coins made by government-controlled Metals and Minerals Trading Corporation of
India.
Government promoted coin and the only BIS hallmarked coin in India. The coin
carries advance counterfeit features and tamper proof packaging.
August 18
BoI to tap retail investors for tier-I capital bonds.
Bank of India plans to tap retail investors for issuance of additional tier-I bonds to
strengthen capital adequacy ratio.
Bank would look at this route (AT1) to raise capital. AT1 are Basel-III compliant
instruments that come with restrictions on payments of interest and principal to
absorb losses.
HDFC Bank, Axis top global charts.
HDFC Bank, Axis Bank and ICICI Bank along with their Chinese peers China
Construction Bank Corp, Industrial and Commercial Bank of China (ICBC) and
Agricultural Bank of China (ABC) occupy the top six slots amongst global banks on
return on equity, return on assets.
For FY16, HDFC Bank and Axis Bank earned the highest return on assets of 1.91
per cent and 1.67 per cent respectively, followed by CCB which clocked return on
assets of 1.30 per cent.
HDFC Bank, Axis Bank, ICICI Bank and State Bank of India (SBI) are the top four
highly valued banks currently based on FY17 estimated price to book value basis.
SBI sets swap ratio for merger with associates.
The board of State Bank of India (SBI) approved a swap ratio for the merger of its
three listed associate banks and the Bhartiya Mahila Bank.
Deal involves allotting 28 shares of SBI (of Re 1 each) for every 10 shares in State
Bank of Bikaner and Jaipur (Rs. 10 each) and 22 shares of SBI for every 10 shares
held in State Bank of Mysore and State Bank of Travancore.
SBI fixed the swap ratio at 4.42 crore shares of SBI for every 100 crore share of
BMB.
IRDAI proposes outsourcing norms for insurers.
Insurance Regulatory and Development Authority of India (IRDAI) proposed
outsourcing norms for insurance companies under which they can take services of
individuals for activities such as medical examination, claim investigation, and
recovery.
As per the exposure draft, every insurer should put in place a comprehensive board
approved outsourcing policy.
Federal Bank to use Chillr app.
To provide cashless transactions to customers through digital technology, Federal
Bank has partnered with Chillr.
Chillr a round-the-clock mobile banking application that connects directly to a
persons bank account and enables instant money transfers, bill payments, phone
recharges and e-commerce payments in a secure environment.
All transactions on Chillr are initiated directly from the users bank accounts and
authenticated by a secure PIN provided by their banks.
August 19
Doha Bank opens first branch in Kerala.
Doha Bank QSC, one of the prominent banks in Qatar, is formally inaugurating its
first branch in Kerala. The branch is located at first floor of Lulu Mall in Edappally.
The branch offers all banking products to corporate and retail customers.
The Bank has its other two branches in Mumbai.
India Post Payments Bank set for 2017 start.
India Post Payments Bank has received the certificate of incorporation from the
Registrar of Companies, paving the way for the postal departments bank to begin
operations in 2017.
The first public sector undertaking under the Department of Posts.
ICICI Bank unveils new 'smart keys' mobile app.
To make mobile payments easier, ICICI Bank has launched a payment service using
a smartphone keyboard named 'iMobile SmartKeys'.
Users will be able to make quick and secure payments on any mobile application,
including chat, messenger, email, games or search browser, without having to exit
their current application on their smartphone.
Customers can transfer money to their registered beneficiaries, pay their utility bills
and recharge their mobile numbers.
Contact-less card from Axis.
Axis Bank launched a contact-less secure debit card for regular savings account
customers, to provide a larger customer base access to such a technology.
The card, launched on the Visa payWave platform, will enable customers to 'Just
Wave to Pay' at NFC-enabled point of sale (PoS) terminals and also use the card as a
normal debit card at any PoS terminal.
August 20
Government selects four investment banks for share sale in HUDCO.
Department of Investment and Public Asset Management (DIPAM), the nodal
agency under the finance ministry that coordinates government disinvestment
programme has selected four investment banks for the proposed share sale in HUDCO
(Housing & Urban Development Corporation Limited).
Four banks include Nomura, SBI Caps, ICICI Securities and IDBI Capital.
The Housing and Urban Development Corporation Limited (HUDCO) is a government-
owned corporation in India.
SBI Merger to add $120 billion to asset base.
The ongoing merger of five of State Bank of India with its associate banks and
Bharatiya Mahila Bank will add Rs. 8 trillion or $120 billion to its assets and will create
a banking behemoth with global scale.
The mergers will dwarf ICICI Bank assets to just one-fourth of SBI and will also
catapult the bank into the top 50 banks globally.
The combined entity will have network of over 24,000 branches with 2,70,000
employees and 58,000 ATMs serving serving over 50 crore customers.
Andhra Bank teams up with Geojit for 3-in-1 online platform.
Andhra Bank has launched a three-in-one online investment and trading platform in
association with Geojit BNP Paribas Financial Services.
The accounts, christened AB eTrade, integrates savings and demat accounts with
online trading.
Using this facility, customers can invest in equity, mutual fund and other capital
market products.
August 21
SARFAESI coverage expanded to large NBFCs.
Finance Ministry has allowed large non-banking finance companies (NBFCs) to take
recourse to the SARFAESI law to recover bad loans.
NBFCs with asset base of Rs. 500 crore or above as per their last audited balance
sheet could use the SARFAESI law to demand repayment of defaulted loan.
However, the latest move comes with a rider that such NBFCs cannot avail the
SARFAESI law in respect of loans less than Rs. 1 crore.
August 22
UBI Raises Rs. 1,000 crore From Bonds.
Union Bank of India on raised Rs. 1,000 crore through bonds to fund business
growth.
Bank issued 10,000 Basel III-compliant Tier II bonds of face value Rs. 10,00,000
each at par aggregating to Rs. 1000 crore on private placement basis.
The bonds are issued for a period of 10 years, with a call option after five years
and thereafter on all coupon payment dates.
August 23
SBI to raise Rs. 11,100 crore additional tier-1 capital.
State Bank of India Committee of Directors for Capital Raising authorized the bank
to raise up to Rs. 11,100 crore Additional Tier 1 (AT1) capital, by way of issue of a
Basel-III compliant perpetual debt instrument in US dollars and/or rupees, at par.
According to credit rating agency ICRA, the risk of default and severity of loss are
significantly higher for AT1 instruments than for deposits or the senior debt of the
issuing bank.
August 24
IndusInd Bank ties up with IBM for Cloud Commerce Solutions.
IndusInd Bank has tied up with IBM to use its Cloud commerce solutions to
transform customer engagements and enhance its cross-sell platforms.
IBM will provide a cloud and predictive analytics based multi-channel campaign
management solution that enables IndusInd Bank to strengthen its online banking
presence while improving the product holding per customer.
August 25
Unified Payments Interface goes live with 21 banks.
National Payments Corporation of Indias Unified Payments Interface is ready and
customers of 21 banks will in a day or two are able to send and collect money via a
Smartphone.
UPI app instead of paying cash on receiving a product from an online shopping
website and also for making miscellaneous payments such as utility bills, school fees
and over-the-counter/barcode-based payments.
UPI, which works on single click two-factor authentication, will allow a customer to
have multiple virtual addresses for accounts in various banks.
The new payments interface will also provide an option for scheduling push and pull
transactions, such as sharing bills among peers.
Karnataka Bank launches UPI app.
Karnataka Bank has launched 'KBL-SMARTz', a mobile application (app) built on the
unified payments interface (UPI) platform of the National Payments Corporation of
India (NPCI).
UPI is a new initiative from NPCI in the digital payments ecosystem. The interface
is designed to enable customers across UPI member banks to pay and collect money
from their smartphones without entering any bank account information.
August 26
RBI asks banks to provide loans to women self-help groups in rural areas at
7% per annum.
RBI has asked banks to provide loans to women self-help groups in rural areas at 7
per cent per annum, as per the government's revised guidelines for the current
financial year.
All women self-help groups (SHGs) will be eligible for interest subvention on credit
up to three lakh rupees at 7 per cent per annum under the
DeendayalAntyodayaYojana - National Rural Livelihoods Mission in 250 districts.
SHGs availing capital subsidy under the Swarnajayanti Gram SwarozgarYojana in
their existing credit outstanding will not be eligible for benefit under this scheme.
Finance Ministry set up a committee for digitalize incentive payments.
With an aim to discourage cash transactions, the Finance Ministry has set up a
high-level committee to suggest steps to promote card payments through incentives
like tax rebates and cash back schemes.
The 11-member committee, headed by former Finance Secretary Ratan P Watal.
The panel, which will review the payments system in the country and recommend
measures for encouraging digital payments, has been set up following a decision
taken by the Cabinet in February.
Study feasibility of creating a payments history of all card/ digital payments and
ensure that merchants/ consumers can leverage the data to access ''instant, low
cost micro-credit'' through digital means and create necessary linkage between the
payment history and credit information.
World Bank sanctions Rs. 980 crore for Brahmaputra dredging.
World Bank has sanctioned Rs. 980 crore to dredge the Brahmaputra as an
initiative to develop waterways to Bangladesh and to other South East Asian
countries in a bid to boost trade and industry in the Northeast.
Brahmaputra waterways will pave the way for trade that will lead to a reduction in
the cost of transportation of goods and will finally the state of Assam will become
export hub for the South East Asian countries.
Sanction also boosts the Centres Act East Policy that also in line to boost trade
with South East Asian countries such as Thailand, Myanmar, Laos, Cambodia and
other countries.
August 27
HDFC to issue NCDs worth Rs. 500 crore.
HDFC Ltd will issue bonds worth Rs. 500 crore to meet its long-term capital
requirements.
HDFC will issue secured redeemable non-convertible debentures on a private
placement basis for a tenor of one-and-a-half years to raise the amount.
The object of the issue is to augment the long-term resources of the corporation.
The proceeds of the present issue would be utilised for financing/ refinancing the
housing finance business requirements of the corporation.
RBI allows banks to pledge corporate bonds as collateral.
RBI to allow banks to pledge corporate bonds with the RBI to borrow short-term
funds.
One of the key measures taken to improve demand and liquidity of corporate
bonds.
Liquidity adjustment facility (LAF) allows banks to borrow money from the RBI
under the repo window by selling government securities with an agreement to
repurchase the same.
Banks can pledge corporate bonds too for borrowing funds under the LAF.
SBI, ICICI Bank continue to be systemically important.
Reserve Bank of India has identified State Bank of India (SBI) and ICICI Bank as
domestic systemically important banks (D-SIBs) in 2016.
Under the D-SIB framework, these banks are required to maintain additional
Common Equity Tier-1 capital.
According to the RBI, SBI and ICICI Bank will need to maintain Additional Common
Equity Tier-1 (CET1) capital of 0.6 per cent and 0.2 per cent, respectively, of their
risk-weighted assets.
RBI seeks to cap banks exposure to large borrowers.
Reserve Bank of India has proposed a significant tightening of norms pertaining to
concentration risk of banks vis-a-vis their exposure to large borrowers (both single
and group).
RBI has proposed the capping of exposure of banks to each counter-party or group
of connected counter-parties at 20 and 25 per cent of their eligible capital base,
respectively.
In exceptional cases, boards of banks can allow an extra 5 per cent (of the eligible
capital base) exposure to a single borrower. There must be a board-approved policy
in this regard.
A large exposure is defined as any exposure to a counter-party or group of
connected counter-parties that is equal or larger than 10 per cent of a banks eligible
capital base.
August 28
Banks express concern over RBIs credit rules for large borrowers.
Banks have raised concerns on Reserve Bank of Indias new norms for bank
exposure to large corporate entities, particularly in large infrastructure projects.
As per the new RBI norms, which will come into effect from April 1, 2017,
incremental exposure of banking system to a specified borrower beyond normally
permitted lending limit (NPLL) will be deemed to carry higher risk which will be
recognized by way of additional provisioning and higher risk weight.
The Oriental Bank of Commerce to raise Rs. 1,000 crore via Tier-1 bonds.
Oriental Bank of Commerce is planning to raise Rs. 1,000 crore through additional
Tier-I bonds (AT1) to increase its capital adequacy and business growth.
India Ratings has assigned an 'A+' rating to OBC's AT1 bonds with a stable outlook,
which reflects the bank's standalone credit profile. OBC will reportedly need Rs. 5,600
crore of Tier-I capital till FY19.
August 29
Doha Bank opens first branch in Kerala.
Doha Bank QSC, one of the prominent banks in Qatar, is formally inaugurating its
first branch in Kerala.
The branch is located at first floor of Lulu Mall in Edappally.
The Bank has its other two branches in Mumbai.
NABARD sanctions loan for 10 MW solar plant in Haryana.
National Bank for Agriculture and Rural Development (NABARD) has sanctioned a
loan of Rs. 204.67 crore for Haryana under Rural Infrastructure Development Fund for
projects including a 10 MW solar plant at Panipat thermal power station.
Rs. 147.18 crore has been sanctioned to the state government under the 22nd
tranche of RIDF for 2016-17 for construction of three rural bridges, the construction
and upgradation of 26 rural roads in 10 districts.
RBI to regulate P2P lending.
RBI has proposed that peer-to-peer lending platforms would be regulated as a
separate category of NBFCs.
Peer-to-peer (P2P) lending is a form of crowd-funding with financial returns.
Borrowers and lenders are brought together online with the help of the P2P lending
platform, which is used to raise unsecured finance.
One of the main advantages of P2P lending for borrowers is that the rates are
lower than those offered by money lenders/ unorganized sector, while the lenders
benefit from higher returns compared to a savings account or any other investment.
RBIs total assets up 12.25%.
RBI saw a 12.25 per cent increase in its total assets to Rs. 32,43,011 crore.
The increase on the asset side was due to a rise in foreign investments and
domestic investments by 7.98 per cent and 35.64 per cent.
August 30
Kotak Mahindra Bank gets nod for selling up to 10% to Canada pension fund.
Kotak Mahindra Bank has received approval of the Reserve Bank of India to sell less
than 10 per cent of its stake to Canada-based pension fund CPPIB.
CPPIB has picked up stake of the bank from Japanese multinational Sumitomo Mitsui
Banking Corp (SMBC) through an open market operation.
As per the norms, a foreign investor cannot own more than 10 per cent in a private
sector bank.
CBDT signs 20 Unilateral Advance Pricing Agreements with Indian taxpayers.
Central Board of Direct Taxes (CBDT) entered into twenty (20) Unilateral Advance
Pricing Agreements (APAs) with Indian taxpayers.
Many of these agreements also have a ''Rollback'' provision in them.
APA Scheme was introduced in the Income-tax Act in 2012 and the Rollback
provisions were introduced in 2014.
The taxpayer has the option to rollback the APA for four preceding years. Since its
inception, the APA scheme has attracted tremendous interest among Multi National
Enterprises (MNEs) and that has resulted in more than 700 applications (both
unilateral and bilateral) having been filed in just four years.
August 31
Canara Bank launches UPI app 'empower'.
Canara Bank has launched customer-centric digital initiative which enables 'any
Bank customers to link and operate their various Bank accounts using a single app'.
Bank launched Unified Payment Interface [UPI] App named 'empower'. Mobile app
works on NPCI platform and enables any bank customers to pay and collect using this
single app.
Non-Canara Bank customers can also use this application to link accounts held in
other banks and use it for a host of financial and non-financial services.
ICICI Bank launches Unified Payments Interface apps.
ICICI Bank announced the launch of 'Unified Payments Interface' (UPI) on two of
its customer facing mobile banking applications 'Pockets' and 'iMobile'.
UPI enables bank account holders (of banks participating in UPI) to send and
receive money using a Virtual Payment Address (VPA) without entering additional
bank account details.
<--Back
Ushodaya Enterprises Private Limited 2016

WWW Eenadupratibha Net Pratibha OnlineDesk CA Eng Banking Au

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

WWW Eenadupratibha Net Pratibha OnlineDesk CA Eng Banking Au

Uploaded by

Copyright:

Available Formats

Today's Mortgage Rates 30-Year Fixed 3.38% 3.

3.17% APR 15-Year Fixed 2.75% 2.75% APR

Ushodaya Enterprises Private Limited 2016

You might also like