The World of Finance: Week of August 04th to August 10th 2014


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India: RBI

  • RBI said the proposed Bharat Bill Payment System (BBPS) will have a single brand image providing convenience of ‘anytime anywhere’ payment to customers
  • RBI relaxes takeout financing norms for existing infrastructure loans
  • RBI revised guidelines for mortgage guarantee companies and said that guarantees provided by them may be treated as contingent liabilities, for which credit conversion factor would be 50%
  • RBI allows select crop loan relief in Andhra Pradesh and Telangana

India: SEBI

  • The Lok Sabha approved the Securities Laws (Amendment) Bill 2014 SEBI to crack down on ponzi schemes to prevent systematic financial swindle of gullible small depositors
  • SEBI approves establishing real estate investment trusts (REITs)

India: Finance Ministry

  • Finance Ministry: Examine inflation, growth while setting rate
  • The finance ministry has decided to issue directives to public sector banks (PSBs) to be more transparent in their dealings, cut the role of intermediaries, and fix accountability for actions at the top level
  • The finance ministry has been pulled up by the Comptroller & Auditor General (CAG) for making tax refunds of close to Rs 6,700 crore without Parliamentary authorization
  • Finance ministry has cleared 14 FDI proposals which will lead to inflow of Rs 1,528 crore into the country. The largest FDI proposal cleared is in pharma sector of Rs 600 crore by Laurus Labs Private

India: Banking Development

  • IndusInd Bank has launched a purely video-based channel connecting customers on mobiles and desktops to staff representatives for face-to-face communications
  • The MMTC PAMP, a joint venture between public sector MMTC and Swiss company PAMP, plans to set up 10 Gold purity verification centres in five metros in the next six months, to benefit Gold deposit scheme of banks
  • IndusInd Bank launched a co-branded credit card with Jet Airways, offering a range of benefits under the carrier’s loyalty programme

India: Banking Expansion

  • Odisha Government has prepared an action plan and asked banks to provide services in all 4,597 unbanked gram panchayats (GPs) of the state
  • Kotak Mahindra Bank to raise Rs 300 cr via infra bonds
  • Andhra Bank is planning to issue infrastructure bonds not just for institutional investors but also for retail investors
  • Bandhan Bank to set up fresh branch networks, to hire rural persons
  • HDFC Bank opened its branch at the Dubai International Financial Centre (DIFC)

India: General banking

  • The draft norms for forming small and payment banks have failed to enthuse urban cooperative banks (UCBs), as they find the scope of operation for niche banks too restrictive
    Western Union, the world’s largest money-transfer company, is planning to apply to the RBI for a payments bank licence
  • CBI begins to investigate IDBI Bank’s Rs 900 crore-loan to Kingfisher Airlines
  • Bharatiya Mahila Bank Ltd bagged the Core Banking System Initiative Award for the year 2014 at the Asian Banking and Finance – Retail Banking Awards 2014

India: They said it

  • Raghuram Rajan, Governor, RBI: RBI had started discussions with the government on a monetary policy framework that includes measures to control inflation

India: Frauds

  • S K Jain, suspended chairman and managing director (CMD) of Syndicate Bank, had allegedly prevented loans of over Rs 100 crore on Bhushan Steel and Prakash Industries from being declared as non-performing assets (NPAs)

India: Forex reserve

  • India’s foreign exchange reserves declined by $573.5 Mn to $319.99 Bn for the week ended Aug 1


  • Bank of America has reached a $17 bn settlement with the Justice Department as a settlement in an investigation into the sale of toxic financial products in the run-up to the financial crisis
  • The World Bank’s Board of Executive Directors approved a US$500 mn operation to finance the First Programmatic Financial Sector Development Policy Loan in Ukraine to support a program of high-priority reform measures in the country’s banking sector