Tides of 14.07.2015

1.   A bank union has  demanded the merger of beleaguered Kerala-based lender Dhanalakshmi Bank with a nationalised bank, alleging mismanagement. The All-India Bank Officers Association (AIBOA), which claims to be the second largest union of bank officers, urged "the RBI to initiate immediate steps to merge Dhanalakshmi Bank with a nationalised bank" to avoid conflict of interests in managing the affairs of the bank by the board and top management.

2.    Banks should consult each other and jointly decide on the timing to raise fresh capital from the market, RBI Deputy Governor R Gandhi has said.

3.    Confident that ICICI Bank will keep scaling greater heights, former Chairman K V Kamath has said the bank is in "great hands" under the leadership of its current CEO Chanda Kochhar. Mr.Kamath, relinquished his position as bank's Chairman earlier this month to take up the responsibility as the first President of the BRICS nations' USD 100-billion New Development Bank (NDB).

4.    YES Bank, India's fifth-biggest private sector lender by assets, has asked market regulator Sebi to probe the "intentions" of analysts of brokerage UBS, who, in a recent report, had painted a bleak picture of the bank's finances if its borrowers were to default. The bank alleged that UBS' analysts did not make "full and fair disclosure" of their "interests" before publishing the report.

5.    Large banks are likely to post muted profits for the first quarter with analysts predicting a dip in net profit for staterun lenders, while their private sector counterparts may record a modest rise as the sector continues to grapple with sticky loans and low credit growth.
Treasury profit for the first quarter too, is expected to be subdued compared with the January-March period on lower bond prices. Bond yields and prices move in opposite directions.

6.    State Bank of India, the country's largest lender, has red-flagged the power sector as a fast-ticking time bomb that could escalate the banking system's non-performing assets (NPAs) to an alarming level over the next couple of months and erode confidence in banks. With the sector accounting for the highest chunk of gross bank credit among industries, State Bank of India chairperson Arundhati Bhattacharya conveyed banks' anxiety to the government in separate interactions with top officials from the ministries of finance and power over the last week.

7.    India's largest lender State Bank of India has entered into a tripartite agreement with the leading online financial product aggregator 'bankbazaar.com' and SBI Cap, the bank's subsidiary. The move is aimed at facilitating home borrowers to apply SBI home loans through yet another platform. Under this arrangement, SBI will be able to display its home loan products on bankbazaar.com, generate leads and provide door-step delivery, thus improving the response time.