🍒 Central Bank of India too Writes Off Rs17,239 Crore Bad Loans of Big Defaulters and Recovers Just 7% in 8 Years : Following the footsteps of other large banks from the public sector, Central Bank of India too wrote off Rs17239.74 crore and recovered a paltry 7% or Rs1205.92 crore over the past eight financial years from big defaulters. As it has become a norm with public sector banks (PSBs), Central Bank too denied sharing names of big defaulters under the Right to Information (RTI) Act. Information shared by the bank to Pune-based RTI activist Vivek Velankar shows that the Central Bank has written off Rs17,239.74 crore as technical write-offs in the eight-year period from FY12-13 to FY19-20. As against these write-offs, the recovery was just 7% or Rs1205.92 crore. This applies only to loan defaults of Rs100 crore and more. In its reply, the bank says, "Year-wise recovery in particular accounts of Rs100 crore and above is not available with us. However, total recovery in those accounts till FY2019-20 is Rs1,205.92 crore." - moneylife.
🍒 New Deputy Governor to oversee 6 departments at RBI : Newly-appointed Deputy Governor M Rajeshwar Rao will oversee six departments at the Reserve Bank of India (RBI). The six departments that Rao will manage are: Regulation; Communication; Enforcement Department; Inspection; Legal ; and Risk Monitoring.The Appointments Committee of the Cabinet had approved the appointment of Rao, Executive Director, RBI, to the post of Deputy Governor on October 7.The fourth Deputy Governor’s position was vacant since NS Vishwanathan quit his position in March, about three months ahead of the completion of his term. Following the elevation of Rao, the RBI now has four Deputy Governors. The other three Deputy Governors are – BP Kanungo, MK Jain and MD Patra. - Business Line
🍒 Lakshmi Vilas Bank board meeting on Oct 15 to consider rights issue : A meeting of the Board of directors of Lakshmi Vilas Bank Limited will be held on Thursday, October 15, to consider and approve the issue of Securities of the bank to existing shareholders on a rights basis. The issue will be subject to necessary regulatory and statutory approvals, LVB informed the exchange. It may be recalled that the Board and shareholder meetings of LVB held on August 26 and September 25, respectively, approved the raising of funds by way of issuance of equity shares or other eligible security. These included global depository receipts, American depository receipts, foreign currency convertible bonds, fully/partly convertible debentures and other instruments, aggregating to not more than Rs l,000 crore. Sources said the lender plans to raise Rs 500-700 crore via rights issue. Many of the existing institutional investors are expected to participate and subscribe to it in order to protect the investments they have already made. - Business Standard
🍒 Exim Bank extends $400 mn soft loan to Maldives for connectivity project : India has extended a USD 400 million (about Rs 2,932 crore) soft loan to Maldives through the Exim Bank to finance a connectivity project in the nation of islands, a statement said on Monday. The Export-Import Bank of India (Exim Bank) on behalf of the Government of India has extended a Line of Credit (LoC) of USD 400 million for undertaking Greater Male's connectivity project in Maldives, the bank said. The loan agreement was inked in Male on Monday between Exim Bank General Manager Nirmit Ved and Maldives' Finance Minister Ibrahim Ameer. With the signing of the above agreement, Exim Bank has till date extended three LoCs worth a cumulative USD 1.2 billion to Maldives, on behalf of India. Exim Bank said the soft loans to Maldives have funded connectivity, water, sewerage projects, Addu Development Project, an international cricket stadium, Gulhifalhu port, Hanimaadhoo airport and road construction work. - Business Standard
🍒 Kotak Sec less optimistic on linkages between changes to risk weight and loan growth : Kotak Securities Ltd (KSL) said it is less optimistic on the linkages between changes to risk weight and loan growth, interest rates or credit flow. “It is most likely that there is lack of confidence between lenders to take risk, while borrowers may be less certain of the near-term outlook on their financials leading to a lower off take,” said the wholly-owned subsidiary of Kotak Mahindra Bank in a report. The Reserve Bank of India (RBI), in its bi-monthly monetary policy on October 9, had announced two primary measures for the banking system to provide liquidity and improve credit flow by modifying the definition pertaining to retail/SME loans. - Business Line
🍒 Axis Bank collaborates with Google Pay, Visa to launch a new ACE Credit card : Axis Bank on Monday announced the launch of its ACE Credit Card in India in collaboration with Google Pay and Visa. The card meant to help with digital payments. From application to issuance, with the entire user journey for the credit card application will be done digitally. For essential use cases, including mobile recharges and bill payments made via Google Pay, users can earn a cashback.of 5 per cent. The company is also offering 4 per cent-5 per cent cashback for expenses on food ordering, online grocery delivery, cab rides for transactions made on partner merchant platforms such as Swiggy, Zomato, BigBasket, Grofers and Ola. There is also an unlimited 2 per cent cashback on other transactions (terms and conditions applied). - Business Line
🍒 FDI routed through Mauritius: RBI move will create transparency and accountability on the source of funding : The Reserve Bank of India’s stance that financial firms can not be set up with funds from Mauritius or other non-FATF-compliant jurisdictions is likely to bring more transparency and accountability into funding in the sector, according to players. But experts have also said the government must clarify on foreign direct investments from Mauritius into the sector. Industry watchers point out that the last few months have seen a surge in investments from China, which is routed from countries such as Mauritius and Cayman Islands. - Business Line
🍒 Rs 11.1 trillion: Amount RBI pumped into banking system to boost liquidity : Measures taken by the Reserve Bank of India during the Covid crisis were driven by the need to expand liquidity in the system sizeably, in order to ensure that financial markets and institutions function normally in the face of Covid-related dislocations, consistent with the monetary policy stance. The liquidity measures were taken as per the revised liquidity management framework introduced on February 14, this year. The central bank reduced the policy repo rate by 40 bps on May 22, on top of a 75 bps reduction on March 27, and introduced a number of liquidity enhancing initiatives that stabilised the bond yields even on the face of a Rs 12 trillion borrowing programme. “In order to make it relatively unattractive for banks to passively park funds with the Reserve Bank and to encourage their deployment for on-lending to productive sectors of the economy, the policy interest rate corridor was widened to 90 bps through a reduction of 25 bps in the reverse repo rate on April 17, 2020,” said the RBI’s monetary policy report. - Business Standard
🍒 ₹10,000 festive advance scheme: Govt to give pre-loaded RuPay cards : In a move to boot consumer demand in the economy during the festive season, the government on Monday announced a slew of schemes such as payment of cash in lieu of LTC and ₹10,000 festival advance to government employees. Festival advance along with similar advances were abolished on the recommendation of the 7th pay commission. But to spur consumer demand in an economy hit by coronavirus pandemic, the government decided to restore it as a one-time measure. "All Central Government employees can now get an interest-free advance of Rs. 10,000, to be spent by 31st March, 2021 on the choice of festival of the employee. The interest-free advance is recoverable from the employee in maximum 10 instalments," the Finance Ministry said in a statement. - Live Mint
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