Wednesday 18 November 2020

18.11.2020: Today's Banking / Financial News

 18.11.2020: Today's Banking / Financial News at a Glance

🍒 BoB issues Basel III compliant AT-I bonds worth ₹833 crore : Bank of Baroda (BoB) on Tuesday said it has issued and allotted Basel III Compliant Additional Tier (AT) I Bonds aggregating ₹833 crore to 10 allottees. The issue of “8.50 per cent unsecured, rated, listed, subordinated, non-convertible, fully paid up AT I perpetual bonds” opened and closed on November 12, 2020 on BSE Bond platform, the public sector bank said in a regulatory filing. The bonds were allotted on Tuesday. - Business Line

🍒 RBI proposes merger with DBS Bank as possible solution to Lakshmi Vilas Bank's capital woes : Lakshmi Vilas Bank is proposed to be merged with DBS Bank India, the local unit of Singapore-based DBS Holdings, ending years of speculation about the future of the teetering bank. DBS would invest Rs 2,500 crore in the equity of the bank that would help the merged entity have a comfortable capital position. This would also help the Singapore bank get a significant foothold in the Indian banking space with a network of 560 branhes. The development also ends Clix Capital's plan of a merger with Lakshmi Vilas and gaining a banking license. The government on Monday evening has placed the capital-starved bank under moratorium for a month till December 16 and put a ceiling on cash withdrawal up to Rs 25000 for the bank's depositors. The decision was taken in consultation with the Reserve Bank of India. - economic times

🍒 Yes Bank launches co-branded prepaid card with Neokred for cashless payments : Yes Bank on Tuesday said it has launched a co-branded prepaid card in partnership with Neokred Technologies to facilitate cashless payments. The card offerings can be personalised to suit the requirements of corporates seeking salary cards or expense cards for their employees.Yes Bank in partnership with Neokred Technologies has launched 'Yes Bank Neokred Card', a co-branded prepaid card, encouraging cashless payments, the lender said in a release.The prepaid card will be offered to Neokred's corporate partners across various sectors, including healthcare, financial institutions, NBFCs, oil companies, educational institutions, FMCG and infrastructure. The prepaid card can be loaded with balance and used for spends such as purchases, payment for utility bills, online shopping, ticket bookings and cash withdrawal at ATMs along with various benefits. - economic times

🍒 Lakshmi Vilas Bank placed under moratorium; withdrawals capped at Rs 25,000 : The Indian government on Tuesday imposed a one-month moratorium on Lakshmi Vilas Bank and capped the cash withdrawal limit at Rs 25,000 for depositors. “The financial position of The Lakshmi Vilas Bank has undergone a steady decline with the bank incurring continuous losses over the last three years, eroding its net-worth. In absence of any viable strategic plan, declining advances and mounting non-performing assets (NPAs), the losses are expected to continue. The bank has not been able to raise adequate capital to address issues around its negative net-worth and continuing losses,” the Reserve Bank of India (RBI) said. Further, the central bank added that LVB is also experiencing continuous withdrawal of deposits and low levels of liquidity. It has also experienced serious governance issues and practices in the recent years which have led to deterioration in its performance. The bank was placed under the Prompt Corrective Action (PCA) framework in September 2019 considering the breach of PCA thresholds as on March 31, 2019. - economic times

🍒 Had demanded timely action from RBI on Lakshmi Vilas Bank, merger with a public sector bank: AIBEA : The umbrella body of bank unions AIBEA on Tuesday said it was demanding a timely action from the RBI on Lakshmi Vilas Bank (LVB) as the regulator was aware about its financial condition for the last three years and said its demand for a merger with a public sector bank has not been accepted. For the past three years and more, the Tamil Nadu-based private sector Lakshmi Vilas Bank has not been in good health, rather, it was suffering from bad health and continuous loss, it said. The reason is well known to all including the RBI, the All India Bank Employees’ Association (AIBEA) said in a release. - financial express

🍒 NBFCs, HFCs saw an improvement across asset class in September: ICRA : Non-banking companies and housing finance companies were able to improve their collections this September amidst the economic impact of the Covid pandemic in the country, ICRA said Tuesday. The collection efficiency in ICRA-rated retail pools (originated largely by non-banking financial companies or NBFCs and Housing Finance Companies or HFCs) witnessed considerable improvement in September 2020 for almost all the asset classes, ICRA research said. The research said that many consumers also cleared their overdues and opted for pre-payments of their past dues.- economic times

🍒 Govt mulls easing rules for border nation FDI : India is considering a plan to allow up to 26% foreign direct investment (FDI) from countries with which it shares a land border, including China and Hong Kong, without government scrutiny in sectors that are on the automatic route. An inter-ministerial panel of secretaries is discussing various options and a decision is expected soon, government officials said. The decision would expedite more than 100 proposals that are stuck after the FDI policy was amended in April, making government approval mandatory for foreign investment from border nations. The inter-ministerial panel is headed by the home secretary. - economic times

🍒 NBFCs lose car loan market share on rate war by PSBs : NBFCs are losing market share to banks in car and SUV financing and are shifting their focus to used cars, two-wheelers and commercial vehicles instead. A combination of capital constraints among NBFCs and renewed aggression from public sector banks (PSBs) has led to this situation, said auto financiers. In a bid to grow their retail portfolio, PSU banks are offering auto loans at 7.25% to 7.7% compared to NBFCs whose rates range from 8.75% to 11%. While State Bank of India (SBI) is offering auto loans starting from 7.7%, others are even cheaper with Central Bank of India offering loans at 7.25%, followed by Canara Bank (7.3%), United Bank of India (7.4%) and Indian Overseas Bank (7.55%). - economic times

🍒 Former Infosys chief appointed as chairperson of RBI's newly set up Innovation Hub : The Reserve Bank of India has set up an innovation hub for accelerating innovation in the financial sector through effective use of technology. Former Infosys chairman and co-founder, Senapathy Gopalakrishnan, has been appointed as the first chairperson of the Reserve Bank Innovation Hub (RBIH), central bank said in a statement on Tuesday. The governance council of RBIH composes prominent scientists, academicians, regulators and former executives of the banking sector. “The Reserve Bank in its Monetary Policy Statement…the Bank will set up to promote innovation across the financial sector by leveraging on technology and creating an environment which would facilitate and foster innovation,” the central bank said. - - economic times

🍒 Karnataka Bank launches CASA campaign : Karnataka Bank launched CASA (current account, savings account) mobilisation campaign on Monday which will run from November 17 to March 4, 2021. A press release by the bank said that it intends to mobilise over 4.10 lakh current and savings accounts with an accretion of ₹650 crore of business. Quoting Mahabaleshwara MS, Managing Director and Chief Executive Officer of the bank, the release said that the campaign has twin objectives of enabling basic banking services to unbanked sections of society and also popularising digitally-powered CASA products of the bank for the next level of customers based on their requirements. - Business Line

🍒 RBI commences first Test Phase of Regulatory Sandbox retail payments : The Reserve Bank of India (RBI) on Tuesday said two entities — Natural Support Consultancy Services Pvt Ltd, Jaipur and Nucleus Software Exports Ltd, New Delhi — started testing of their products under its ‘Regulatory Sandbox (RS) - First cohort on Retail Payments - Test Phase’ from November 16. RS usually refers to live testing of new products or services in a controlled and test-regulatory environment for which regulators may (or may not) permit certain regulatory relaxations for the limited purpose of the testing. - Business Line

🍒 IIFL Finance raises ₹100 crore via NCDs : IIFL Finance on Tuesday said it has raised ₹100 crore through issuance of non-convertible debentures on a private placement basis. It said the debentures will be listed on the wholesale debt market segment of the NSE. “The finance committee of the board of directors of the company.... approved allotment of 1,000 non convertible debentures.....of face value of Rs. 0 lakh each, for cash at par, aggregating to ₹100 crore, on private placement basis,” IIFL Finance said in a regulatory filing. - Business Line

🍒 DHFL resolution: No decision taken on Adani’s bid at creditors’ meet : The meeting of the Committee of Creditors of Dewan Housing Finance Corporation Ltd on Tuesday ended without any decision being taken on whether to accept the unsolicited offer made by the Adani Group. Top banking sources told BusinessLine that the CoC will wait for a direction on how to deal with the situation under the IBC rules. “The bid covers were not opened,” said a source aware of the proceedings. - Business Line

🍒 Kris Gopalakrishnan appointed first chairperson of Reserve Bank Innovation Hub : The Reserve Bank of India (RBI) has appointed Senapathy (Kris) Gopalakrishnan, co-founder and former co-Chairman, Infosys, as the first Chairperson of the Reserve Bank Innovation Hub (RBIH). The central bank, in its Statement on Developmental and Regulatory Policies issued on August 6, 2020, had announced that it would set up an Innovation Hub to promote innovation across the financial sector by leveraging on technology and creating an environment which would facilitate and foster innovation. - Business Line

🍒 Magma Fincorp to raise up to ₹500 cr for housing finance arm : Magma Fincorp is looking to raise capital to the tune of ₹400-500 crore for its wholly-owned subsidiary – Magma Housing Finance Ltd (MHFL). Plans are afoot to rope in a strategic partner to infuse funds into the business, which has been growing at a CAGR of over 30 per cent for the last 2-3years. According to Kailash Baheti, CFO, Magma Fincorp, housing finance portfolio has been doing well and the company would like to grow the business further. MHFL’s asset under management (AUM) stood at ₹3,554 crore as of Q2 FY21.- Business Line

🍒 As economy picks up, need for one-time debt restructuring will decrease: Crisil : There will be few takers among companies for one-time Covid-related debt restructuring as improving business sentiment and ongoing, gradual recovery minimise the need for it, according to Crisil. A preliminary analysis of 3,523 non-MSME companies rated by the credit rating agency indicates that as many as 99 per cent of them are unlikely to opt for the Reserve Bank of India’s (RBI’s) one-time-debt-restructuring (OTDR). The RBI had, on August 6, announced the scheme as a relief measure for non-MSME corporate borrowers having an aggregate exposure greater than ₹25 crore and were under stress due to the pandemic. - Business Line

🍒 RBI curbs withdrawals from Jalna-based Mantha Urban Coop Bank for 6 months : Reserve Bank of India on Tuesday imposed restrictions on withdrawals from Maharashtra-based Mantha Urban Cooperative Bank for six months. The RBI, in a release, said it has issued certain directions to Mantha Urban Cooperative Bank, Mantha District Jalna, Maharashtra, from the close of business on November 17, 2020.As per the directions, the bank will not, without prior approval of RBI in writing, grant or renew any loans and advances, make any investment, incur any liability including borrowal of funds and acceptance of fresh deposits, disburse or agree to disburse any payment, among others. "In particular, no deposit of the total balance across all savings bank or current account or any other account of a depositor may be allowed to be withdrawn" subject to conditions stated in the directions, the central bank said. - Business Standard

🍒 Sensex rallies over 300 points to hit fresh peak : After touching its all-time peak of 44,161.16 during the session, the 30-share BSE index settled 314.73 points or 0.72 per cent higher at 43,952.71. Similarly, the broader NSE Nifty touched a fresh intra-day high of 12,934.05. It finally finished 93.95 points or 0.74 per cent up at its closing record of 12,874.20. Tata Steel was the top gainer among the Sensex constituents, surging around 6 per cent, followed by SBI, HDFC Bank, Bajaj Finance, Axis Bank, LT, Maruti, IndusInd Bank and HDFC. On the other hand, NTPC, HCL Tech, ONGC, Infosys, ITC, PowerGrid, and Hindustan Unilever were in the red.

🍒 Rupee settles 16 paise higher at 74.46 against US dollar : The rupee on Tuesday appreciated by 16 paise to settle at 74.46 (provisional) against the US dollar on the back of improved demand for riskier assets after positive news on the coronavirus vaccine. Besides, a weak dollar overseas also supported the local unit. At the interbank forex market, the domestic unit opened strong at 74.43 against the US dollar and later touched a high of 74.38 in day trade.

🍒 Gold prices today struggle after falling ₹1,200 last week, silver rates drop : Gold and silver prices in India struggled today after a sharp fall last week. On MCX, December gold rose 0.05% to ₹50,856 per 10 gram while silver futures were steady at ₹63,700 per kg. Gold prices had edged about 0.2% lower in previous day's truncated session as MCX remained closed during for the morning session due to a holiday. Last week, gold prices on MCX fell ₹1,200 per kg, tracking a similar trend in overseas markets as optimism over covid vaccine put pressure on gold prices.

No comments:

Post a Comment