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| Bank strike hits cash, forex deals |
| BS Reporter / Mumbai Aug 07, 2009, 00:04 IST |
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Trading volumes in the bond, foreign exchange and money markets and normal branch operations were adversely affected On Thursday as bank employees began their two-day strike On Thursday demanding higher wages and pension. However, the government’s Rs 12,000-crore bond auction is expected to go through smoothly.
The volume of cheques presented for clearing dwindled On Thursday. A Reserve Bank of India (RBI) official said that as against the daily average of 6,00,000, only 1,35,000 cheques were presented for clearing at its main centre in Mumbai.
A senior public sector bank official said branch operations were impacted by the strike, causing inconvenience to customers.
However, the automated teller machines (ATMs) and offline channels provided some relief as customers could continue to withdraw cash.
Banks have made arrangements to ensure adequate supply of currency notes to ATMs during the two days, said the head of retail banking with a large public sector bank.
Meanwhile, the open market operations (OM0) auction by RBI sailed through smoothly despite the low level of activity at treasuries. “RBI made enquiries in the morning about the impact and arrangements for operations,” said the head of treasury with a large government lender.
Trading in the government bond market was thin. The turnover on Negotiated Dealing Platform Order Matching system was noted at Rs 2,915 crore as against Rs 4,350 crore yesterday. The RBI official added that the government was scheduled to raise Rs 12,000 crore by auctioning three dated securities tomorrow.
“The auction is online. So, we not expect any hitch in operations for government bond auction,” dealers said.
The government is auctioning 6.49 per cent 2015 paper (Rs 4,000 crore), , 6.90 per cent 2019 paper (Rs 6,000 crore) and 7.40 per cent 2035 bond (Rs 2,000 crore).
India domestic gold trading remained thin as most of the banks, the primary sellers of gold, were shut due to a strike, dealers said. “Volumes are affected as our branches are shut,” said a dealer with a state-run bank in Mumbai.
“We are on strike from today as Indian Banks’ Association (IBA) did not concede to the bank unions demand for the wage hike,” said United Forum of Bank Unions (UFBU) convener C H Venkatachalam.
Besides not agreeing to a wage hike as demanded by the unions, Venkatchalam said the IBA has also retracted from its earlier stand that the existing pension scheme will be extended to the remaining employees who are now in provident fund scheme.
The UFBU is an umbrella body of nine bank employees’ unions of the country and claims to have members from public, private and foreign banks.
The UFBU claimed that as many as 10 lakh employees, including officers, are participating in the strike and services in about 60,000 bank branches in the country have been affected.
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