🍒 Bank credit rises by 5.67%, deposits up 10.63%: RBI data : Bank credit grew by 5.67 per cent to ₹104.04 lakh crore, while deposits increased by 10.63 per cent to ₹143.80 lakh crore in the fortnight ended November 6, according to RBI data. In the fortnight ended November 8, 2019, bank credit stood at ₹98.46 lakh crore and deposits at ₹129.98 lakh crore. In the previous fortnight ended October 23, 2020, bank credit had risen by 5.06 per cent and deposits by 10.12 per cent. On a year-on-year basis, non-food bank credit growth decelerated to 5.8 per cent in September 2020 from 8.1 per cent in the same month of the previous year, according to the central bank data. Credit to industry recorded ‘nil’ growth in September 2020 as compared to 2.7 per cent rise in September 2019. Credit to agriculture and allied activities rose by 5.9 per cent during the reporting month, as against a growth of 7 per cent in the same month last year. - Business Line.
🍒 RBI internal working group recommends promoters to hold higher stake in private banks : The Reserve Bank of India’s internal working group constituted to review ownership in Indian private banks has recommended allowing promoters to hold 26% in banks over a period of 15 years. The working group in its proposal has also favourably looked at allowing industrial houses as bank promoters only after making legislative changes to the banking regulation act. It has also recommended increasing cap on non-promoter holding to 15% so as to bring a uniformity among all types of shareholders.RBI will now seek stakeholder comments on the report till January 15, 2021, after which it will examine the comments and suggestions before taking a view in the matter. “The cap on promoters’ stake in the long run (15 years) may be raised from the current level of 15% to 26% of the paid-up voting equity share capital of the bank,” the RBI said while releasing the recommendations of the internal working group. it’s internal group. - economic times
🍒 Large corporates may be allowed as promoters of banks: RBI Internal Working Group : An internal working group constituted by the RBI has recommended that large industrial houses be allowed as promoters of banks. The Internal Working Group (IWG) was constituted on June 12, 2020 to review extant ownership guidelines and corporate structure for Indian private sector banks. "Large corporate/industrial houses may be allowed as promoters of banks only after necessary amendments to the Banking Regulation Act, 1949 (to prevent connected lending and exposures between the banks and other financial and non-financial group entities); and strengthening of the supervisory mechanism for large conglomerates, including consolidated supervision," the working group recommended. It also recommended that well run large NBFCs with asset size of over Rs 50,000 crore be considered for conversion into banks subject to completion of 10 years of operation.- economic times
🍒 Bajaj Finance, M&M Financial may be front runners to become banks if RBI accepts suggestions : Bajaj Finance, Mahindra & Mahindra Financial, Shriram Transport Finance may become prime candidates for conversion into banks despite their strong corporate lineage if Reserve Bank of India accepts the suggestions by its internal working group which called for relaxing the first-level entry barrier. “Well run large NBFCs, with an asset size of Rs 50,000 crore and above, including those which are owned by a corporate house, may be permitted to convert to banks provided they have completed 10 years of operations,” the working group proposed. It has built a case for relaxing the first-level entry filter and encouraging large non-banking finance companies to become a bank with an aim to “reduce chances of regulatory arbitrage”. The group suggested that they should be given a glide path for compliance with norms as applicable to banks. - economic times
🍒 ED assures SC of no coercive action against former ICICI Bank CEO Chanda Kochhar in PMLA case : The Enforcement Directorate (ED) Friday assured the Supreme Court that it would not take any coercive action against former ICICI Bank CEO and MD Chanda Kochhar in a money laundering case. A bench headed by Justice S K Kaul was informed by Solicitor General Tushar Mehta that the agency would not take any coercive step in pursuance of the ECIR registered in ICICI Bank-Videocon Group loan case. The bench, also comprising Justices Dinesh Maheshwari and Hrishikesh Roy, said it would hear later the two other petitions filed by Chanda Kochhar challenging the arrest of her husband Deepak Kochhar in the case.The ED has recently filed a charge sheet against Kochhar, Deepak Kochhar and Videocon Group promoter Venugopal Dhoot on money laundering charges. Kochhar's, Dhoot and others have denied the allegations, official sources had said earlier. - economic times
🍒 RBI should've called for bids from interested parties: Lakshmi Vilas Bank promoter : Advocating proper valuation of Lakshmi Vilas Bank (LVB), its promoter has said that Singapore-based DBS Bank was willing to acquire 50 per cent stake in the 94-year-old Karur-based LVB in 2018 at over Rs 100 per share. He said the RBI should have called for bids from interested parties. The Reserve Bank of India ( RBI) is now offering the 563 branches (many branches, head office, corporate office-owned building) LVB and other real estate free of cost to DBS Bank India Ltd, a subsidiary of DBS Bank, Singapore. "Logically, the RBI should have called for bids from interested parties. Or, if it wanted to give LVB to only DBS Bank India, it could have asked it to talk with the former to give their valuation," KR Pradeep, LVB promoter, told IANS.- economic times
🍒 RBI imposes monetary penalty on six entities : The Reserve Bank of India has imposed monetary penalty on six entities, including Sodexo SVC India, Muthoot Vehicle and Asset Finance, QwikCilver Solutions, Phonepe, Delhi Metro Rail Corporation, and Punjab National Bank. In exercise of powers vested under Section 30 of the Payment and Settlement Systems Act 2007, the RBI has imposed monetary penalty on the entities for non-compliance of regulatory guidelines, it said in a statement on Friday. - Business Line.
🍒 South Indian Bank to acquire 6.67% stake in IBBIC Pvt Ltd for Rs 5 lakh : The South Indian Bank has become one of the initial subscribers to the Memorandum and Articles of Association of IBBIC Private Limited (IBBIC) for a cash consideration of Rs 5 lakh. Earlier on Friday, Axis Bank also announced that it will acquire a 6.67 per cent stake in IBBIC for Rs 5 lakh.The South Indian Bank Limited will hold 6.67 per cent shareholding in IBBIC through acquisition of 50,000 equity shares with face value Rs 10 each. IBBIC is proposed to be incorporated as a financial technology company with the objective of providing a platform for exploring, building and implementing distributed ledger technology solutions for the financial services sector. - Business Standard
🍒 TMB Q2 net profit up 60% at ₹241 crore : hoothukudi-headquartered Tamilnad Mercantile Bank is taking all steps to carve a niche for itself in the NextGen banking space. “The business opportunity is huge in new emerging areas such as pharma (which we had not tapped so far in this journey) and towards transforming ourselves digitally,” said KV Rama Moorthy, Managing Director, TMB. The journey has not been smooth for this bank, which is marching towards its 100th year of existence. “Our strength, nevertheless, lies in providing excellent customer service, strong connect and loyalty,” said the TMB MD. - Business Line
🍒 DBS offered to buy 50% of Lakshmi Vilas Bank in 2018, but RBI rejected: Promoter : K R Pradeep, the single largest promoter of the crippled Lakshmi Vilas Bank with a 4.8 per cent shareholding, has said that Singapore’s DBS was keen to acquire 50 per cent stake in the lender for a high valuation in 2018 but the Reserve Bank did not allow the deal to go through. With the Reserve Bank of India (RBI) superseding Lakshmi Vilas Bank’s board and mooting its merger with DBS Bank India, Pradeep also said he was confident that the central bank will be kind enough to listen to all the shareholders and promoters, and will not let them go empty handed. - moneycontrol.
🍒 RBI may not allow corporate houses to own banks despite working group recommendations: Macquarie Capital : The Reserve Bank of India may not allow corporate houses to own banks, despite its internal working group suggesting to adopt a liberal stance, Macquarie Capital said on Friday. The brokerage house has also said that given rise in bank failures the regulator may not distribute bank licenses liberally. “We expect RBI to exercise caution in this regard and hence some of the recommendations may not see the light of the day,” said Suresh Ganapathy, Associate Director, Macquarie Capital. “We don’t believe, industrial houses, even if they own NBFCs, will be allowed to open a bank or convert into a bank. The experience of allowing corporate houses to run banks has been pretty bad for RBI and hence in our view, RBI won’t be allowing corporate houses. Even today, on-tap licensing is available, but no one has got a license from RBI.”- economic times
🍒 EPFO adds 14.9 lakh net new subscribers in September; quarterly addition at pre-Covid levels : The retirement fund body Employees’ Provident Fund Organisation said its net new enrollment rose to 14.90 lakh in September, 49 per cent jump compared to September last year when 10.00 lakh net subscribers were added, indicating more formal jobs being created as economic recovery gathers momentum. Net enrollments under EPFO in August stood at 10.05 lakh. The net payroll addition for the second quarter of FY’21 stood at 30.34 lakh, which is approximately equal to payroll figures of second quarter of FY’20. “This indicates a robust recovery to pre Covid-19 levels,” it said on Friday. “The payroll data is provisional since updating of employee records is a continuous process and accordingly gets updated on a month on month basis,” it added. - economic times
🍒 SBI revises Q2 GDP estimates to -10.7 per cent from -12.5 per cent earlier : Citing continuous revisions in India's GDP estimates as the current norm, State Bank of India (SBI) revised their second-quarter (Q2) GDP to -10.7 per cent from -12.5 per cent with a positive bias, in a research report from SBI Ecowrap on Friday. The report titled, "Positive events improve India's Q2 GDP projections: Losses reduced but reasons to remain cautious remain," was authored by Dr Soumya Kanti Ghosh, SBI's Chief Economic Adviser. "We are revising our Q2 GDP growth to -10.7 per cent (earlier -12.5 per cent) with a positive bias, based on our nowcasting model with 41 high-frequency indicators, associated with industry activity, service activity, and global economy. Our estimate of Q2 Financial Year (FY) 2021 (or Q3 2020) is aligned with the economic growth seen by various economies in Q3 2020. The GDP contraction halved in Q3 2020 compared to Q2 2020 for select 18 economies," stated the report. - economic times
🍒 LIC launches digital application tool for agents : Life Insurance Corporation of India has launched a digital application for agents for onboarding to get a life insurance policy. The Digital Application is called “ANANDA”, which is an acronym for Atma Nirbhar Agents NewBusiness Digital Application. “The Digital application is a tool for the onboarding process to get the life insurance policy through a paperless module with the help of the agent or intermediary,” LIC said in a statement on Friday, adding that it is built on paperless KYC process using Aadhaar-based e-authentication of the life proposed. - Business Line
🍒 RBI imposes penalty on Muthoot Finance, Manappuram Finance for non-compliance with gold loan norms : The Reserve Bank of India (RBI) has imposed a penalty of ₹10 lakh on Muthoot Finance Ltd, Ernakulam, and ₹5 lakh on Manappuram Finance Ltd, Thrissur, for non-compliance with its directions. In the case of Muthoot Finance, RBI said the penalty is for non-compliance with directions on maintenance of Loan to Value (LTV) ratio in gold loans and on obtaining copy of PAN (Permanent Account Number) card of the borrower while granting loans in excess of ₹5 lakh. - Business Line
🍒 Reducing promoter stake in private banks: RBI panel for nuanced approach : A Reserve Bank of India committee has recommended doing away with one size fits all approach to ownership in private sector banks. Instead of the current bank licensing rules which make it mandatory for promoters of private bank to reduce their ownership to 40 per cent within three years and to settle at 15 per cent in 15 years, the committee headed by RBI executive director PK Mohanty has suggested a more nuanced approach. The report of the committee is to be made public soon. It has also suggested a rereading of the fit and proper criteria for entities that wish to set up or acquire banks. A top government official had recently told Business Standard the existing criteria made it almost impossible to nurse a sick bank to a healthy position, because of the guidelines that effectively precludes any business group from entering the banking space. The committee is learnt to have supported larger non-banking financial companies to enter the banking space. The argument goes that some of them are far larger than some of the existing banks, yet while the banks are tightly regulated the NBFCs have soft regulations, something that RBI deputy governor Rajeshwar Rao had recently pointed out. - Business Standard
🍒 Bitcoin rises to 3-year peak, all-time high in sight : Bitcoin rose to a three-year high of $18,600 on Friday, up 4.5 per cent on the day and close to its all-time high of just under $20,000. Bitcoin has gained over 16 per cent so far this week - its biggest weekly gain since June 2019 - and is up over 160 per cent this year. - Business Standard
🍒 Modi, Tshering launch phase-2 of RuPay card in Bhutan : Prime Minister Narendra Modi and his Bhutanese counterpart Lotay Tshering have jointly launched the phase-two of the RuPay card in Bhutan – this will allow travellers from the country access RuPay networks in India. The Indian PM also welcomed Bhutan as a full partner in the RuPay network, and said that this would also encourage the growth of digital transactions in the neighbouring country. - Business Line
🍒 Mitsui Sumitomo’s Max Life stake swap with Max Financial Services gets FinMin nod : Max Financial Services Limited (MFSL) has received the Finance Ministry’s approval for Tokyo-headquartered Mitsui Sumitomo Insurance Company (MSI) to pick up 21.87 per cent stake in the listed company. For this purpose, MFSL will issue and allot 7,54,58,088 equity shares of ₹2 each to MSI. This preferential issuance is in consideration for the transfer of equity shares constituting 20.57 per cent of the paid-up share capital of Max life Insurance Company Limited held by MSI to MFSL as part of the share swap transaction. - Business Line
🍒 CARE Ratings revises LVB's ratings from 'BB- ' to 'BB-' under credit watch : CARE Ratings on Friday revised its rating of Lakshmi Vilas Bank (LVB) from "BB-" Negative to "BB-" under credit watch with developing implications. The development comes after the government imposed a moratorium on LVB after considering an application filed by the RBI. RBl's action comes against the backdrop of deterioration in the financial risk profile of the bank with weakened capitalisation levels and in the absence of a credible revival plan. The RBI has superseded the board of directors of the bank and appointed T N Manoharan, former non-executive chairman of Canara bank, as the administrator and on November 17, 2020. RBI has also published a draft scheme for the amalgamation of LVB w ith DBS Bank India Limited (DBS). - Business Standard
🍒 Rupee settles 11 paise higher at 74.16 against USD : The rupee appreciated by 11 paise to settle at 74.16 (provisional) against the US dollar on Friday, supported by positive domestic equities and sustained foreign fund inflows. At the interbank forex market, the domestic unit opened at 74.15 against the US dollar and touched an intra-day high of 74.09 and a low of 74.21. It finally settled at 74.16 against the greenback, registering an increase of 11 paise over its previous close
🍒 Sensex jumps 282 points, Nifty ends above 12,850 : Equity benchmark Sensex surged 282 points on Friday, tracking gains in HDFC Bank, Kotak Bank and Bajaj Finance amid positive cues from global markets and sustained foreign fund inflows. After a highly volatile session, the 30-share BSE index ended 282.29 points or 0.65 per cent higher at 43,882.25. Similarly, the broader NSE Nifty rose 87.35 points or 0.68 per cent to 12,859.05. Bajaj Finserv was the top gainer in the Sensex pack, rallying over 9 per cent, followed by Titan, Bajaj Finance, Kotak Bank, Bharti Airtel, Nestle India and NTPC. On the other hand, Reliance Industries, IndusInd Bank, Sun Pharma, Axis Bank, ONGC and HUL were among the laggards. “The BSE Sensex is closing higher by about 1 per cent in this Diwali week,” said Sanjeev Zarbade, VP PCG Research, Kotak Securities.
🍒 Gold prices today struggle for 5th day in a row, silver rates edge higher : Gold prices continued to struggle in Indian markets for fifth day in a row amid weak global cues. On MCX, gold edged up 0.11% to ₹50,029 per 10 gram after suffering losses in the previous four sessions. Silver futures rose 0.3% to ₹61690. In the previous session, gold prices had fallen 0.7% or ₹350 per 10 gram while silver had declined ₹1,000 or 1.63% per kg. In global markets, gold prices edged lower today amid uncertainty over more US stimulus measures. Spot gold fell 0.2% to $1,863.21 per ounce. Among other precious metals, silver fell 0.1% to $24.06 per ounce while platinum was down 0.2% to $949.88 per ounce..
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