🍒 Union Bank aims to increase CASA to 40% by FY23 : Union Bank of India (UBI) plansto increase the proportion of low-cost current account and savings account (CASA) deposits in its overall deposits to about 40 per cent by March-end 2023 from 34.6 per cent as of September-end 2020. This will help the bank improve its net interest margin (NIM). Simultaneously, the Mumbai-headquartered public sector bank (PSBs) is seeking to bring down the proportion of bulk (term) deposits (of ₹2 crore and above) in the overall deposits by not offering special interest rates. UBI’s focus on CASA comes in the backdrop of its net interest margin (NIM) declining to 2.51 per cent as of September-end 2020 against 2.68 per cent as of September-end 2019. NIM (excess of interest income over interest expense divided by average interest earning assets) is one of the indicators of a bank’s profitability. Rajkiran Rai G, MD and CEO, UBI, said: “Banks with large presence in the North and the East have higher CASA deposits. Typically, South-based banks have relatively lower CASA deposits.” - Business Line
🍒 Indian Bank in pact with SIDBI for asset restructuring module for MSMEs : Indian Bank has entered into an agreement with Small Industries Development Bank of India (SIDBI) to use the latter’s asset restructuring module for MSME borrowers. MSMEs have been finding it difficult to maintain books of accounts, preparation of financial statements and submission of financial projections for producing the same to banks / FIs for availing credit finance / restructuring their loans based on their estimates and revision in working capital cycle. MSMEs have to approach third parties for this purpose which involves time and cost. Small Industries Development Bank of India (SIDBI) has come out with Asset Restructuring Module for MSMEs – Do it Yourself (ARM-MSME DIY) – for supporting these MSMEs. The module enables MSMEs prepare their restructuring proposals / financial viability assessments by themselves and submit to the bank. MSMEs can use this module free of cost. SIDBI is also appointing councillors at select centres to guide the MSMEs in usage of this module. - Business Line
🍒 ECLGS 2.0 will be sufficient to ease liquidity pressures: Crisil : The Emergency Credit Line Guarantee Scheme (ECLGS) 2.0 will be sufficient to help companies, including those hit by a sharp decline in cash flows because of the pandemic, overcome liquidity pressures, according to a Crisil study. The scheme can potentially infuse about ₹40,000 crore in liquidity for Crisil-rated eligible companies, the credit rating agency said in a statement. The ECLGS has been extended as part of the government’s stimulus to the economy under Atmanirbhar Bharat 3.0 to eligible companies in 26 stressed sectors identified by the KV Kamath Committee, and also to the healthcare sector.- Business Line
🍒 Banks in India to see capital decline over 2 years without fresh infusion: Moody's : Moody's Investors Service on Monday said the bank capital will moderately fall in emerging Asia over the next two years, with India seeing larger capital decline without further infusion. In a report, Moody's said the uncertain trajectory of asset quality is one of the biggest threats for emerging market banks, as operating conditions remain challenging amid the current COVID pandemic. The 2021 outlook for banks in emerging markets is negative, while the outlook for insurers is stable, it said. "In the Asia Pacific region, banks' rising nonperforming loans and insurers' volatile investment portfolios are in focus. Capital will moderately fall in emerging Asia over the next two years, and banks in India and Sri Lanka will post larger capital declines without public or private injections," Moody's said. - economic times
🍒 Singapore's DBS says it has completed takeover of distressed Lakshmi Vilas Bank : Singapore's DBS Group said on Monday it had completed its takeover of distressed Lakshmi Vilas Bank, helping it shift from a largely digital presence in India to having hundreds of branches. The 94-year old Chennai-based private bank was folded into DBS's Indian subsidiary at the request of the Reserve Bank of India which cited a serious deterioration in its finances.Southeast Asia's largest lender, which will pump in Rs 2,500 crore ($338 million) into its India unit, until recently had just over 30 branches in India but has now added more than 550 and 900-plus ATMs. - economic times
🍒 Lakshmi Vilas Bank customers can access all services; no change in interest rates as of now: DBS : DBS Bank India on Monday said customers of Lakshmi Vilas Bank, which has now been merged with it, can continue to access all banking services, and interest rates on savings and fixed deposits are unchanged as of now. Lakshmi Vilas Bank (LVB) has now been amalgamated with DBS Bank India Ltd (DBIL), the wholly-owned subsidiary of DBS Group Holdings Ltd, DBS Bank India said in a statement. The amalgamation of LVB into DBS Bank India came into effect from November 27 under the special powers of the government and the Reserve Bank of India under Section 45 of the Banking Regulation Act, 1949. - economic times
🍒 Loan growth continues to remain tepid; but loans to medium sized firms, wholesale trade are outliers : Bank loans to most segments including retail and home loans continued to be tepid in October. But loans for wholesale trade, MSMEs, loan against shares and vehicle loans were outlier with higher growth than last year, according to the latest data on sectoral deployment of bank credit released by the Reserve Bank. Non-food bank credit growth decelerated to 5.6 per cent on a year-on-year (y-o-y) basis, in October 2020 from 8.3 per cent in October 2019. Good monsoons have brightened the prospects for agriculture. Credit growth to agriculture and allied activities accelerated to 7.4 per cent in October 2020 from 7.1 per cent in October 2019.- economic times
🍒 Sidbi to handhold MSMEs for free in formulating restructuring plans : Sidbi is tying up with banks to consider MSME restructuring proposals sent through its newly launched hand-holding help-line. Punjab National Bank (PNB) and Indian Bank have agreed to accept restructuring proposals generated by Sidbi's MSME customers using its helpline. The bank has already signed an MoU with Indian Bank and is in the process of signing separate MoU with PNB and other banks, according to senior officials at Sidbi.Sidbi's helpline- a web portal-"arm-msme" is designed to help MSMEs take benefit of Reserve Bank of India’s MSME restructuring guideline. With the help of this `Do-It-Yourself' asset restructuring web module, MSMEs will be able to prepare restructuring proposals by keying the most essential data of their past financials, future projections and restructuring requirement. - economic times
🍒 Large banks may move RBI to tweak loan rejig rule : Large lenders may soon impress upon the Reserve Bank of India (RBI) the need to tweak a rule to make it easier to rejig loans to companies impacted by the pandemic-induced slowdown. In several cases, such a change will spare companies hit by Covid-19 the stigma attached to a nonperforming asset (NPA) as well lower provisioning for banks. This would call for recognising the months between the ‘invocation of the resolution framework’ (for one-time restructuring of a loan) and its ‘implementation’ as a standstill period. “This may help more banks as well as borrowers to take up one-time restructuring of loans… It will be all the more relevant once the Supreme Court lifts the stay on classification of loan assets,” a senior banker told ET. - economic times
🍒 Jan Dhan accounts, direct cash transfers from government boost ATMs in rural areas : With Jan Dhan accounts and the government’s direct benefit transfers (DBT), ATM usage has gone up in rural areas. This is most clearly seen by the trend of increased usage of ‘white-label operators’ ATMs, which are used only in rural and remote parts of the country. From just 2 per cent of total ATM transactions in India in 2014, these white-label ATMs now make up 12 per cent of total transactions. ATM players say that the main reason for this is that over seven years, the number of debit cards in India has doubled to 86 crore as of September 2020. And of those cards, 35 per cent (30 crore) are RuPay ones issued to PM Jan Dhan Yojana accounts. “We are seeing rural demand growing despite the pandemic. One of the reasons is that the rural economy has not been as severely impacted as the urban one with the lockdown,” says K Srinivas, CEO, BTI Payments, a white-label ATM operator. The government’s assistance to BPL workers during the pandemic is also held to have helped in part the industry take a quantum leap from 9.5 per cent in September 2019 to 12 per cent in September 2020. - economic times
🍒 RBI may keep policy rates unchanged : The Reserve Bank of India (RBI) is likely to keep interest rates unchanged and reiterate its accommodative stance in this week’s monetary policy review, buoyed by good news on the economic front, said investors and traders. But it could also cite concerns about inflation, which has stubbornly remained above the prescribed target range. The monetary policy committee (MPC) is scheduled to meet on December 2-4. Bankers will watch out for any guidance on how the RBI plans to manage the record excess liquidity in the financial system, which has distorted market conditions and led to a drop in short-term rates. Some companies are borrowing at rates lower than the RBI benchmark. - economic times
🍒 Bankers to make last-ditch attempt to get more cash from Lavasa's bidders : Financial creditors to the debt laden Lavasa will make a last-ditch attempt to get more value from bidders for the bankrupt real estate project as the current three bids are close to the liquidation value. Bankers want more cash and will try one on one negotiation with the bidders to extract a better deal, said three persons with direct knowledge of the development. "We have not decided on whether to give the approval for liquidation or to seek a better value from the existing bidders. The assets are still being consolidated and the process is on," said one person aware of the discussions. Creditors to the hill city project are in a bind because the offers that are on the table so far have little or no cash being offered upfront and are based on the returns the bidders expect to make in the future upon completion of the project. - economic times
🍒 Passenger vehicle, 2-wheeler wholesales to decline over next few months: Ind-Ra : Domestic passenger vehicle and two-wheeler wholesales will come down in the next few months as inventory levels remain high at dealer level, according to rating firm India Ratings and Research (Ind-Ra). The overall auto industry would however continue to grow in the next few months, it noted. "With the festive season now over in India, the rating agency expects wholesale billings to moderate in the next couple of months, given that the inventory at dealer level for passenger vehicles (PVs) and two-wheelers is already at higher than the 21 days recommended by Federation of Automobile Dealers Association (FADA)," Ind-Ra said in a statement.- economic times
🍒 Consumers going back to credit cards as inquiries exceed October '19 levels: Transunion Cibil : Consumers are back to moving away from cash to credit card spending, a gauge of increase in formalising economic activity that had come to a virtual standstill after the country-wide lockdown post the COVID pandemic forcing households to opt for cash transactions. Credit card inquiry volumes in October 2020 were at 106 per cent of October 2019 levels, suggesting that consumer economic activity has materially improved since the easing of COVID-19 lockdown measures, according to a report by Transunion Cibil. Data with the credit bureau shows that credit card popularity in traditionally cash driven, non-metro locations has risen with more consumers wanting to transact through cards. Significantly, the credit culture which has been traditionally metro-centric is becoming more broad-based with more non-metro consumers seeking interest in credit cards. October 2020 inquiry volumes in non-metro locations increased by 23 per cent year-on-year (y-o-y), compared to a decline of -10 per cent y-o-y for metro locations. - economic times
🍒 Paytm Money to facilitate investment in public offers : Paytm Money will start facilitating investments in Initial Public Offers (IPOs) in India. The company has made the process of IPO application completely digital and simple for retail investors. Paytm Money has enabled investors to instantly apply for all the latest IPOs via UPI ID, linked to their bank accounts to complete the IPO application process. The platform offers a seamless interface to make changes in, cancel or reapply for the bid application within the IPO window. It is equipped with features enabling investors to track upcoming IPOs, view the company history and details, download prospectus, and also check the performance of past IPOs. This service is available on both the Paytm Money app and website. - Business Line
🍒 Bharti AXA Life renewal premium income up 10% in H1 : Bharti AXA Life Insurance on Monday said that the company registered 10 per cent growth in its renewal premium to ₹594 core in the first half of the financial year 2020-21 from ₹541 crore in the corresponding fiscal period a year ago. However, due to the Covid-19 crisis and subsequent disruptions, the company’s new business premium income fell 23.37 per cent to ₹318 crore (₹415 crore). Total premium income fell 4.6 per cent to ₹912 crore in the April-September period of this fiscal from ₹956 crore in the first six months of the last financial year. The company recorded a surge of 25 per cent in its asset under management at ₹7,987 crore in the first half of 2020-21 against ₹6,404 crore in the corresponding period of the last fiscal. - Business Line
🍒 Merger to provide stability to LVB depositors, employees: DBS Bank India CEO : The amalgamation of Lakshmi Vilas Bank with DBS Bank India will provide stability to LVB's depositors and employees, according to Surojit Shome, DBS Bank India CEO. “The amalgamation of LVB has enabled us to provide stability to LVB’s depositors and employees. It also gives us access to a larger set of customers and cities where we do not currently have a presence. We look forward to working with our new colleagues towards being a strong banking partner to LVB’s clients,” said Shome in a statement on Monday. - Business Line
🍒 DHFL FD holders may get a quarter of their funds repaid : Fixed deposit holders of Dewan Housing Finance Corporation Ltd (DHFL) could get back about a quarter of their investments under the proposed resolution plans, but many point out that it would be too little, too late. “Recent discussions have indicated that FD holders will get atleast some repayment of their investments. It has been indicated that they may be repaid as much as 25 per cent of the amount invested,” said a person familiar with the development. “The SLR ratio is only 13 per cent so that is the amount they can get, irrespective of what the resolution amount is,” the person further said. - Business Line
🍒 Paytm Money launches IPO investments : Paytm, a homegrown financial services major, on Monday announced that its wholly-owned subsidiary, Paytm Money, now facilitates investments in Initial Public Offers (IPOs) in India. This launch will benefit retail investors with wealth creation opportunities, as they will be able to seamlessly apply and join the growth story of rapidly expanding companies. The company has made the process of IPO application completely digital and simple for retail investors across the country to apply for IPOs, a company statement said. Paytm Money has enabled investors to instantly apply for all the latest IPOs via UPI ID, linked to their bank accounts, to quickly complete the IPO application process. The company is leveraging the convenience of UPI infrastructure to offer a faster turnaround time reduced to 3-4 days for completion of the entire process. - Business Line
🍒 SIDBI launches asset restructuring web module : The Small Industries Development Bank of India (SIDBI) has launched an asset restructuring web module, https://arm-msme.in, to help MSMEs (micro, small and medium enterprises) get benefit from the Reserve Bank of India’s (RBI) MSME restructuring guideline. With the help of this Do-It-Yourself (DIY) asset restructuring web module, MSMEs will be able to prepare restructuring proposals by keying in only the most essential data of their past financials, future projections and restructuring requirements, SIDBI said in a statement. The proposal prepared can be submitted online to the banks and reports can also be generated for submission to banks through email or in hard copies. ARM-MSME is being offered free of cost as part of SIDBI’s developmental initiatives. SIDBI is the country’s apex financial institution for the promotion, financing and development of MSMEs. - Business Line
🍒 Mahagram to deploy 12 lakh wireless Bharat ATMs by March 2021 : Mumbai-based fintech start-up Mahagram is all set to deploy 12 lakh wireless ATMs that will empower kirana shops and other retail stores to disburse cash to people, as banks are finding it increasingly unviable to operate and maintain ATMs across the country. The five-year old bootstrapped start-up launched Bharat ATM, a rural banking platform last month, using private banks’ proprietary licenses.Bharat ATM already has 1.5 lakh touchpoints across the country which comprises 20,000 handheld terminals (wireless ATMs) for card payments run on Aadhaar and RuPay card, and the rest are all Android mobiles with the Bharat ATM app installed, which can be used along with a finger print scanner for Aadhaar authentication to dispense cash. - Business Line
🍒 DHFL: Higher offer as per bid documents, says Adani group : The fight to acquire Dewan Housing and Finance Corporation Ltd (DHFL) could spiral into a legal wrangle with the Adani group insisting that it was in the right to submit a higher bid for the entire book of the debt-laden housing finance company. In a communication to the lenders of DHFL, Adani said its bid is as per the process laid out in the bid documents and other applicants have no rights to raise any objections because the Committee of Creditors (CoC) and the Administrator are duty bound to ensure value maximisation. The Adani Group said rival bidders were using cursive means to derail the entire bidding process by threatening to pull out of the auction. - Business Line
🍒 Reliance Capital defaults on interest payment of term loans : Reliance Capital has defaulted on interest payments of term loans amounting to ₹624.61 crore. In a regulatory filing on Monday, it said the term loans of ₹523.98 crore was from Housing Development Finance Corporation and ₹100.63 crore from Axis Bank. The interest accruing on the HDFC loan amounts to ₹4.77 crore and to the Axis Bank loan ₹0.71 crore. The default took place on October 31. “The company is unable to proceed with asset monetisation, resulting in delay in debt servicing, due to prohibition on the company to dispose off, alienate, encumber either directly or indirectly or otherwise part with the possession, of any assets except in the ordinary course of business such as payment of salary and statutory dues, pursuant to order dated November 20, 2019, passed by the Delhi High Court, and orders dated December 3, 2019, and December 5, 2019, passed by the Debts Recovery Tribunal, Mumbai, and order dated November 4, 2020, passed by the Bombay High Court,” Reliance Capital said in the filing. - Business Line
🍒 ABN Amro to cut about 2,800 jobs as investment bank shrinks : ABN Amro Bank NV plans to cut about 2,800 jobs over four years as the Dutch lender retreats from large parts of its investment bank and digitization allows it to operate with a smaller staff. The company plans to reduce costs by about 700 million ($840 million) by 2024 to 4.7 billion euros. The workforce will shrink by about 15%, with most reductions to start in 2022, Chief Executive Officer Robert Swaak said in an investor update on Monday. In August, Swaak announced plans to cut a third of the lender’s business with corporate clients, dropping company finance outside of Europe and exiting trade and commodity financing altogether. ABN Amro posted losses in the first half after taking hits on individual corporate clients before returning to profit in the third quarter. - Live Mint
🍒 Government waives penalty for non-compliance with QR code provisions for B2C transactions : The Centre has waived penalty for non-compliance with QR code provisions for business-to-consumer (B2C) invoices generated by businesses till March 31, 2021. However, it would be mandatory for businesses to follow the QR code provisions from April 1, 2021 to avail this penalty waiver. The requirement of printing dynamic QR code on B2C invoices is being implemented from December 1. Quick Response code or QR code helps users verify the details in digitally signed e-invoices. Under the Goods and Services Tax (GST), companies with a turnover of over Rs 500 crore have to generate e-invoices for B2B (business-to-business) transactions from October 1. However, it is not yet mandatory for B2C transactions. - moneycontrol.
🍒 Six debt schemes of Franklin Templeton get ₹1,895 cr : The six suspended debt schemes of Franklin Templeton has received ₹1,895 crore in the fortnight ended Friday, with inflows from pre-payment alone accounting for ₹1,664 crore, while maturities and coupon payments added up to the rest. With this, the overall inflow in November was about ₹2,836 crore. In all, the six schemes have received ₹11,576 crore from maturities, pre-payments, and coupon payments since it was first suspended in April. - Business Line
🍒 Five of top 10 most valued firms lose together ₹91,699 cr m-cap; RIL worst hit : The combined market valuation of five of top-10 most valued firms declined by ₹91,699 crore last week, with heavyweight Reliance Industries emerging as the worst hit. While Reliance Industries Ltd (RIL), Infosys, HDFC, ICICI Bank and Bharti Airtel suffered losses in their market valuation, Tata Consultancy Services (TCS), HDFC Bank, Hindustan Unilever Limited, Kotak Mahindra Bank and Bajaj Finance were the gainers. RIL's market valuation tumbled by ₹60,829.21 crore to ₹12,23,416.97 crore. The market capitalisation of HDFC plummeted ₹13,703.75 crore to ₹4,05,996.11 crore. Bharti Airtel's valuation declined ₹11,020.23 crore to ₹2,52,755.97 crore and that of ICICI Bank went lower by ₹5,090.54 crore to ₹3,26,225.04 crore. The market capitalisation of Infosys dipped by ₹1,055.27 crore to ₹4,68,779.17 crore. In contrast, HDFC Bank added ₹20,482.86 crore to ₹7,93,336.55 crore. Bajaj Finance's market capitalisation rose by ₹11,181.01 crore to ₹2,95,466.65 crore. - Live Mint
🍒 Gold price slips below Rs 48,000/10 gm, down 6% in November; Silver down Rs 1,039/kg : Gold prices fell below Rs 48,000 per 10 gram in the Indian market tracking feeble global cues despite weakness in the US dollar. The Indian commodity market opened in the evening session as it was shut in the morning session on the eve of Guru Nanak Jayanti. The domestic market retail market was closed today. The price had settled at Rs 48,807 per 10 gram on Friday. Silver prices declined Rs 1,039 to Rs 59,220 per kg from its closing on November 27.
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