1. SBI Funds Management Pvt Ltd - investment managers for SBI Mutual Fund has tied-up with Citibank, to increase the reach of investors across the country. In the initial phase, the SBI MF - Citibank tie-up, shall offer an opportunity to invest in two of SBI Mutual Fund's equity funds, MSFU Contra Fund and Magnum Global Fund and its fixed maturity plans - liquid funds.
2. RBI has said that consistent with the Reserve Bank of India (Amendment Act), 2006, no interest will be payable on CRR balances of banks with effect from the fortnight beginning March 31, 2007.
3. The merger of Lord Krishna Bank with the Centurion Bank of Punjab is in doldrums, as the case pending with the Kerala High Court is likely to prolong further.Umesh Pai, a shareholder of LKB and the original petitioner, had challenged the resolutions and proceedings of the bank’s AGM before the High Court. Justice M N Krishnan has posted the case for further hearing on 25th May.Meanwhile, the scheme of amalgamation approved by the boards of both the banks and the AGM will expire by 30th April, 2007. The boards recently extended the scheme for a further period of 3 months effective from 1st May, 2007.Legal sources have opined that the extension would not be valid unless approved by a fresh AGM. But sources at the bank said that the last AGM had given prior approval to extend the scheme unless it were not to be in effect by the deadline.
4. The activists of the Republican Party of India have threatened to launch agitation against various branches of the ICICI Bank in western Maharashtra in protest against the bank’s policy to deny loans to politicians, journalists, advocates and police.The ICICI Bank’s policy to deny loans to the four constituents came to light when a loan proposal of one Sanjay Gaikwad of Satara was duly forwarded with the requirements and papers but was rejected by the concerned bank manager who clarified that the proposal is rejected on the ground that he being brother of the RPI’s Satara district chief Ashok Gaikwad belongs to the political class and according to the bank’s policy loans are not to be given to politicians along with the other three constituents.After the clarification, the RPI activists entered the Satara branch of the bank and smashed computers, glass windows and furniture on Saturday. While the bank's officials did not lodge complaint to the police, the latter took note of the incident and have lodged the case under the charges of unlawful assembly and smashing of the material.Satara police confirmed they have recorded the offence and have started further inquiry with statements of the banks’ officials in the branch which is attacked by the RPI activists.The RPI chief of the Satara unit Ashok Gaikwad has reiterated that the aggressive action was a reaction against the bank’s policy to deny loans to politicians, journalists, advocates and police who are vital organs of the democracy.
5. Plastic money is catching the fancy of the Indian consumers. Payments through credit and debit cards have increased by 24 % to Rs 44,819 crs up to February this year compared with Rs 36,133 crs in February 2006, according to data from the RBI. Customer payments through electronic channels have increased by 57 % to Rs 2,10,473 crs. Electronic fund transfer has increased by about 24%to Rs 68,832 crs. Customers are increasingly using plastic money to purchase air tickets, wine and dine and also for other leisure needs. Spends on fashion and lifestyle products comes next.
6. Banking transactions executed at a branch will cost a bank around Rs 40. In metros, this cost goes up to Rs 70 as the real estate cost is very high. While if the transaction is routed through an ATM, the cost comes down to Rs 18. Usage of a credit or debit card at a point of sale terminal brings down the cost further to Rs 1.Bank customers now pay their utility bills and other monthly obligations such as equated monthly installments on loans, life insurance premiums through electronic clearing system (ECS). ECS is an electronic channel for retail payments.
7. A mid-sized new private sector bank is hiring around 1,400 sales personnel on a temporary basis to expand its reach to 250 new cities and towns.Temporary staffing (temping in the staffing parlance) has become the catch-phrase among new private sector banks, foreign banks and general insurance companies as they seek to tap the expanding market outside the metros. It is estimated about one lakh temporary sales personnel would be hired by banks and general insurers by the end of 2007.
8. Banks will now have to insist on complete information about customers wishing to transfer funds both locally and overseas. In its latest notification on wire transfers, RBI has stated that this move would help prevent criminals and terrorists from having access to wire transfer services.RBI has mandated that all cross-border wire transfers must be accompanied by accurate and meaningful originator information. Also, information accompanying such transfers must contain the name and address of the originator and the corresponding account number. In the absence of an account, a unique reference number, as prevalent in the country concerned, must be included.
For domestic wire transfers, RBI requires all transfers of Rs 50,000 and above to be accompanied by complete originator information. However, if a bank has reason to believe that a customer is intentionally structuring wire transfers to below Rs 50,000 in order to avoid reporting or monitoring, the bank must insist on complete customer identification before effecting the transfer.However, settlements where both the originator and beneficiary are banks or financial institutions, they are exempted from these requirements.
9. The rush for depositing dividend cheques by investors in Mumbai, has led to a staggering of clearing operations of the RBI. The system has been reeling under the pressure of heavy cheque volumes since the onset of the new fiscal. This has been largely aggravated by the huge dividend issuances by companies, apart from a spate of public holidays. On an average, sources at RBI said that the month of March saw an average of 6,75,000 cheques being processed on a daily basis. Now, as against this, the month of April has already seen average daily volumes rising to nearly 12 lakh cheques.
10. Even as Banks try to keep interest in stocks alive and make money amid hardening interest rates, a new capital rule proposed by the regulator could force them to hit the equity market in a big way.A RBI draft note circulated among banks suggests that the banking sector may be required to raise at least Rs 25,000 crs from the stocks and bond markets to fulfil the proposed capital condition. It could also slow down the fierce loan growth since most banks will be left with lesser resources to finance companies.The key change indicated by RBI involves a significant increase in risk weightage on a big chunk of unrated loans in banks’ books. Current rules say for every Rs 100 a bank lends, it must have a capital of at least Rs 9, which means a risk weightage of 100%. As against this, the note has now proposed a weightage of 150%, which would mean a capital requirement of Rs 13.5 for every Rs 100 loan. This would apply to all unrated loans above Rs 10 crs.
11. Commercial banks have increased international liabilities to almost double the level of their international assets, according to the latest RBI figures.As of the end September 2006, while international assets amounted to $35,491 mn, international liabilities amounted to $72,945 mn. RBI attributed this mismatch to `deployment of the funds mobilised from abroad, in the domestic market in domestic currency. In rupee terms, international liabilities of banks increased by Rs 14,236 crs (4.4%) and Rs 46,127 crs (16%) at end-September 2006 over the position in the previous quarter and a year ago, respectively.
2. RBI has said that consistent with the Reserve Bank of India (Amendment Act), 2006, no interest will be payable on CRR balances of banks with effect from the fortnight beginning March 31, 2007.
3. The merger of Lord Krishna Bank with the Centurion Bank of Punjab is in doldrums, as the case pending with the Kerala High Court is likely to prolong further.Umesh Pai, a shareholder of LKB and the original petitioner, had challenged the resolutions and proceedings of the bank’s AGM before the High Court. Justice M N Krishnan has posted the case for further hearing on 25th May.Meanwhile, the scheme of amalgamation approved by the boards of both the banks and the AGM will expire by 30th April, 2007. The boards recently extended the scheme for a further period of 3 months effective from 1st May, 2007.Legal sources have opined that the extension would not be valid unless approved by a fresh AGM. But sources at the bank said that the last AGM had given prior approval to extend the scheme unless it were not to be in effect by the deadline.
4. The activists of the Republican Party of India have threatened to launch agitation against various branches of the ICICI Bank in western Maharashtra in protest against the bank’s policy to deny loans to politicians, journalists, advocates and police.The ICICI Bank’s policy to deny loans to the four constituents came to light when a loan proposal of one Sanjay Gaikwad of Satara was duly forwarded with the requirements and papers but was rejected by the concerned bank manager who clarified that the proposal is rejected on the ground that he being brother of the RPI’s Satara district chief Ashok Gaikwad belongs to the political class and according to the bank’s policy loans are not to be given to politicians along with the other three constituents.After the clarification, the RPI activists entered the Satara branch of the bank and smashed computers, glass windows and furniture on Saturday. While the bank's officials did not lodge complaint to the police, the latter took note of the incident and have lodged the case under the charges of unlawful assembly and smashing of the material.Satara police confirmed they have recorded the offence and have started further inquiry with statements of the banks’ officials in the branch which is attacked by the RPI activists.The RPI chief of the Satara unit Ashok Gaikwad has reiterated that the aggressive action was a reaction against the bank’s policy to deny loans to politicians, journalists, advocates and police who are vital organs of the democracy.
5. Plastic money is catching the fancy of the Indian consumers. Payments through credit and debit cards have increased by 24 % to Rs 44,819 crs up to February this year compared with Rs 36,133 crs in February 2006, according to data from the RBI. Customer payments through electronic channels have increased by 57 % to Rs 2,10,473 crs. Electronic fund transfer has increased by about 24%to Rs 68,832 crs. Customers are increasingly using plastic money to purchase air tickets, wine and dine and also for other leisure needs. Spends on fashion and lifestyle products comes next.
6. Banking transactions executed at a branch will cost a bank around Rs 40. In metros, this cost goes up to Rs 70 as the real estate cost is very high. While if the transaction is routed through an ATM, the cost comes down to Rs 18. Usage of a credit or debit card at a point of sale terminal brings down the cost further to Rs 1.Bank customers now pay their utility bills and other monthly obligations such as equated monthly installments on loans, life insurance premiums through electronic clearing system (ECS). ECS is an electronic channel for retail payments.
7. A mid-sized new private sector bank is hiring around 1,400 sales personnel on a temporary basis to expand its reach to 250 new cities and towns.Temporary staffing (temping in the staffing parlance) has become the catch-phrase among new private sector banks, foreign banks and general insurance companies as they seek to tap the expanding market outside the metros. It is estimated about one lakh temporary sales personnel would be hired by banks and general insurers by the end of 2007.
8. Banks will now have to insist on complete information about customers wishing to transfer funds both locally and overseas. In its latest notification on wire transfers, RBI has stated that this move would help prevent criminals and terrorists from having access to wire transfer services.RBI has mandated that all cross-border wire transfers must be accompanied by accurate and meaningful originator information. Also, information accompanying such transfers must contain the name and address of the originator and the corresponding account number. In the absence of an account, a unique reference number, as prevalent in the country concerned, must be included.
For domestic wire transfers, RBI requires all transfers of Rs 50,000 and above to be accompanied by complete originator information. However, if a bank has reason to believe that a customer is intentionally structuring wire transfers to below Rs 50,000 in order to avoid reporting or monitoring, the bank must insist on complete customer identification before effecting the transfer.However, settlements where both the originator and beneficiary are banks or financial institutions, they are exempted from these requirements.
9. The rush for depositing dividend cheques by investors in Mumbai, has led to a staggering of clearing operations of the RBI. The system has been reeling under the pressure of heavy cheque volumes since the onset of the new fiscal. This has been largely aggravated by the huge dividend issuances by companies, apart from a spate of public holidays. On an average, sources at RBI said that the month of March saw an average of 6,75,000 cheques being processed on a daily basis. Now, as against this, the month of April has already seen average daily volumes rising to nearly 12 lakh cheques.
10. Even as Banks try to keep interest in stocks alive and make money amid hardening interest rates, a new capital rule proposed by the regulator could force them to hit the equity market in a big way.A RBI draft note circulated among banks suggests that the banking sector may be required to raise at least Rs 25,000 crs from the stocks and bond markets to fulfil the proposed capital condition. It could also slow down the fierce loan growth since most banks will be left with lesser resources to finance companies.The key change indicated by RBI involves a significant increase in risk weightage on a big chunk of unrated loans in banks’ books. Current rules say for every Rs 100 a bank lends, it must have a capital of at least Rs 9, which means a risk weightage of 100%. As against this, the note has now proposed a weightage of 150%, which would mean a capital requirement of Rs 13.5 for every Rs 100 loan. This would apply to all unrated loans above Rs 10 crs.
11. Commercial banks have increased international liabilities to almost double the level of their international assets, according to the latest RBI figures.As of the end September 2006, while international assets amounted to $35,491 mn, international liabilities amounted to $72,945 mn. RBI attributed this mismatch to `deployment of the funds mobilised from abroad, in the domestic market in domestic currency. In rupee terms, international liabilities of banks increased by Rs 14,236 crs (4.4%) and Rs 46,127 crs (16%) at end-September 2006 over the position in the previous quarter and a year ago, respectively.
