Banking Sector

RBI asks banks not to charge usurious interest rate on loans

RBI asks banks not to charge usurious interest rate on loansNew Delhi: RBI has advised boards of banks not to levy usurious interest rate including processing and other charges on loans.

"It is not proposed to issue any guidelines to the banks to offer loans to borrowers at uniform rate of interest in view of variation in their costs, business models, margins etc," Finance Minister Arun Jaitley said in a reply to the Lok Sabha.

RBI, Monetary Authority of Hong Kong ink MoU for info exchange

RBIMumbai: The Reserve Bank of India has inked a memorandum of understanding (MoU) with the Monetary Authority of Hong Kong for exchange of supervisory information.

"The RBI on Thursday signed a Memorandum of Understanding (MoU) for supervisory cooperation and exchange of supervisory information with the Monetary Authority, Hong Kong," RBI said in a notification.

The MoU with Monetary Authority, Hong Kong, was signed by Arthur Yuen, Deputy Chief Executive, Banking, the Monetary Authority, Hong Kong and Harun R Khan, Deputy Governor, RBI.

The signing ceremony was held at the Monetary Authority office in Hong Kong.

South Indian Bank Q1 Net up 10.28% at Rs 126 crore

South-Indian-BankKochi: Kerala-headquartered South Indian Bank has recorded the highest first quarter profit of Rs 126.65 crore profit in the first quarter ended June 30, registering a 10.28 percent growth on a year-on-year basis.

Announcing the first quarter results here, V A Joseph, Managing Director and CEO, said the bank's strategy of focusing on core deposits has yielded excellent results as the core deposits and CASA deposits registered impressive growth of 21.05 percent and 14.42 percent, respectively.

Total business increased by Rs 6,058 crore from Rs 75,123 crore to Rs 81,181 crore, registering a growth of 8.06 percent.

RBI allows NBFCs to use e-KYC service to verify identity

RBIMumbai - Non-Banking Financial Companies (NBFCs) have been allowed to accept e-KYC service as a valid process to verify identity and address proof of customers to reduce risk of fraud and forgery.

"In order to reduce the risk of identity fraud, document forgery and have paperless KYC verification, UIDAI has launched its e-KYC service.

"Accordingly, it has been decided to accept e-KYC service as a valid process for KYC verification under Prevention of Money Laundering (PML) (Maintenance of Records)," the RBI said in notification addressed to NBFCs Monday.

'SBI, PNB likely to tap capital market this year'

G-S-SandhuNew Delhi: Public sector SBI and PNB could be among the first banks to tap capital market this financial year to raise funds to meet global risk norms Basel III, a top finance ministry official said here Friday.

Financial Services Secretary G S Sandhu also said no final decision has been taken yet.

"Which banks will go first, that we have to work out. We have asked all banks to submit their capital requirement plans. They have given their proposal and we are giving final touch to them. The schedule will be worked out soon," he added.

RBI increases diamond imports' credit time to 180 days

RBIMumbai: The Reserve Bank has relaxed norms governing import of rough, cut and polished diamonds by doubling the credit time period to 180 days.

"... It has been decided, in consultation with the government, that the Clean Credit i. e. Credit given by a foreign supplier to its Indian customer/ buyer, without any Letter of Credit (Suppliers' Credit)/Letter of Undertaking (Buyers' Credit)/Fixed Deposits from any Indian financial institution for import of rough, cut and polished diamonds, may be permitted for a period not exceeding 180 days from the date of shipment," RBI said in a notification.

Earlier, the time frame was of 90 days.

ICICI will acquire a bank of right size and valuation: Kochhar

ICICIMumbai: ICICI Bank will look at acquiring a bank if it finds one with the right size and right valuation, but is yet to find a takeover target that fits in its evaluation model, the bank chief Chanda Kochhar said.

ICICI Bank, which added 650 branches to its network in the last fiscal ended March 31, 2014, is as such adding business equivalent to the size of one bank in its ordinary course of business and any acquisition target would need to be of a relevant size, Kochhar said.

Black money: Make requests that are 'justified', Swiss banks tells India

UBSNew Delhi/Zurich: As India steps up pressure on Swiss authorities in its pursuit of alleged black money, banks in Switzerland say they follow strict rules and the requests from Indian authorities must be "properly justified".

The Association of Foreign Banks in Switzerland, an over four-decade old grouping, is also of the view that a clear and transparent policy can help in dispelling "apprehensions" and the "conjectures" should not be allowed to dominate the public opinion.

To bring back illicit money stashed away overseas, India has recently made a fresh request to Switzerland to seek bank details of such entities.

BNP Paribas settles sanctions violations, pays $9b to US

BNP-ParibasLondon, July 1 : France's largest bank BPS Paribas has reportedly agreed to a record 9billion dollars settlement with US prosecutors over sanctions violations.

The settlement is said to be the largest for such a case in US history.

According to the BBC, the US Attorney General said the bank was involved in a complex and pervasive scheme to illegally move billions through the US financial system which was a deliberate attempt at violating the longstanding US sanctions.

France has been condemning the size of the fine, which almost equals BNP's entire pre-tax income of about 8.2billion euros of 2013. (ANI)

ICICI to open branches in Australia, SA, Mauritius: Kochhar

ICICI-BankVadodara: The country's largest private sector lender ICICI Bank on Monday said it plans to open branches in Australia, South Africa and Mauritius.

The city-headquartered bank has received the regulatory clearances to open the branches and will also upgrade its representative office in China, Managing Director and Chief Executive Officer Chanda Kochhar said on the sidelines of its 20th annual general meeting here.

Indian Bank declares 47% dividend for 2013-14

Indian-BankChennai: Shareholders of public sector Indian Bank have approved final dividend of 47 percent for the year ending March 31, 2014.

A decision to this effect was taken at the bank's annual general meeting held in the city recently, Chennai-based Indian Bank said in a statement.

"Shareholders approved payment of dividend of 47 percent for the year 2013-14 of which bank has made payment of interim dividend of 30 percent on January 25, 2014," it said.

Union Bank of India to raise Rs 1,386 cr via QIP

Union-BankNew Delhi: State-owned Union Bank of India has proposed to raise Rs 1,386 crore through Qualified Institutional Placement (QIP) to fund its business growth.

Shareholders of the bank have approved raising of capital up to Rs 1,386 crore by way of QIP, UBI said in a statement.

The bank had earlier planned the QIP last fiscal but it was called off considering poor market conditions.

Therefore, the bank sought extension of the proposal from shareholders for raising fund through QIP in 2014-15. It is looking to raise the fund during the second quarter of the current fiscal.

Banks' asset quality better but systemic risks up: RBI

RBIMumbai: The Reserve Bank of India on Thursday said the overall asset quality of banks has improved in the recent past with a reduction in bad loans, although systemic risks have increased.

"Banking sector risks have increased since December 2013, as shown by the Banking Stability Indicator.

"Though there was a marginal improvement in asset quality, concerns remain about the liquidity and profitability aspects. Stress tests indicate higher vulnerability for public sector banks as compared to their private sector counterparts," the RBI said in its ninth Financial Stability Report released this evening.

Two big banks have 2/3rd of all Swiss money of Indians

UBS and Credit SuisseZurich/New Delhi: It is just two big banks -- UBS and Credit Suisse -- which appear to be accounting for almost two-third of the total money held by Indians in Swiss banking system, known for their famed secrecy walls.

According to the latest official data disclosed by Switzerland's central banking authority SNB (Swiss National Bank), Indians' money in Swiss banks rose by 43 per cent last year to 2.03 billion Swiss francs (nearly Rs
14,000 crore), despite growing global pressure on Switzerland to share client details of their banks.

Moving bond trading regulation to hit govt bond market: Rajan

Raghuram-RajanMumbai: Reserve Bank of India Governor Raghuram Rajan on Tuesday said shifting the regulation of bond trading from the central bank would have an adverse impact on the government bond market.

"My personal view is that moving the regulation of bond trading at this time would severely hamper the development of the government bond market, including the process of making bonds more liquid across the spectrum, a process which the RBI is engaged in," Rajan said at State Bank of India's Banking and Economic Conclave.

He was talking about reforms suggested by the Financial Sector Legislative Reforms Commission (FSLRC).

PSU banks' asset quality woes likely to continue: Fitch

FitchNew Delhi: The Centre today expressed concern over the law and order situation in Uttar Pradesh with BJP slamming the Akhilesh Yadav government there for the present state of affairs even as Congress demanded strict action against trouble-makers and miscreants.

"This should not be taken as some politics being done by us because their government is of a different party.

"Whatever the government -- whether of our party or of some other party, everybody is worried if the law and order situation is not good.

RBI's LCR guidelines credit positive for banks: Moody's

Moody sMumbai: The Reserve Bank of India's recent guidelines on liquidity risk management is credit positive for banks, says a report.

The central bank last week issued the final Basel III framework on liquidity standards, which included guidelines on the minimum liquidity coverage ratio (LCR), liquidity risk monitoring tools and LCR disclosure standards.

The RBI said the liquidity coverage ratio (LCR) will be introduced in a phased manner with a requirement of 60 percent from January 2015.

The requirement would rise in equal steps to reach the minimum required level of 100 percent on January 1, 2019, it added.

'RBI to soon announce rules for on-tap banking licenses'

RBIKolkata: The Reserve Bank of India (RBI) would soon come out with policy guidelines for differentiated banking licenses which would be given on tap, deputy governor of the apex bank R Gandhi said.

Besides, he criticised banks for not extending financial assistance to the micro, small and medium size enterprises (MSMEs) and asked lenders to consider the working dynamics of this sector while extending credit.

"The RBI will soon come out with policy guidelines in differentiated banking licenses within a short period of time", Gandhi told reporters on the sidelines of ICC Banking Summit here today.

Bengal govt to provide banks space for opening branches

Amit MitraKolkata: The West Bengal government will provide space to banks in order to set up new branches in Gram Panchayat offices in villages, with the view to promote financial inclusion.

"The government would give space in the offices of Gram Panchayat so that banks could set up brick-and-mortar branches in the rural areas which will promote financial inclusion," state Finance Minister Amit Mitra told reporters on the sidelines of ICC Banking Summit here today.

He said that banks would be offered typically spaces of around 400 square feet.

'RBI to soon announce rules for on-tap banking licenses'

'RBI to soon announce rules for on-tap banking licenses'Kolkata: The Reserve Bank of India (RBI) would soon come out with policy guidelines for differentiated banking licenses which would be given on tap, deputy governor of the apex bank R Gandhi said.

Besides, he criticised banks for not extending financial assistance to the micro, small and medium size enterprises (MSMEs) and asked lenders to consider the working dynamics of this sector while extending credit.

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