Decoding why India's public sector banks are in trouble

StatsGuru-06-January-2014

Business Standard

A price index for agri commodities: A Business Standard and Indicus Analytics initiative

Indicus price monitor

Business Standard analyses one family's finances and suggests a suitable way forward

Case study

Business Standard brings you a snapshot of average current rates and unit sizes in localities that offer property in a price range of Rs 3 crore to Rs 6 crore. If you are looking at buying real estate and your budget falls within this range, an idea about prevailing rates would come in handy

Realty check

In his press conference, the prime minister has said that people voted the United Progressive Alliance (UPA) to power for a second term despite the scams associated with the first one because they did not believe in them. He has conveniently forgotten the fact that the scams of UPA-I, such as the one with Dayanidhi Maran, came to be known only during UPA-II. While certifying that Rahul Gandhi, a greenhorn wet behind the ears with no administrative experience, has outstanding credentials to be PM, he has said that Narendra Modi, with all he has done for Gujarat, will be disastrous if he occupies the post. Coming from Manmohan Singh the aam aadmi will treat it as a joke. The Congress won't get a single seat in Gujarat for insulting Modi. Never in our history have we had such a ruinous government with one scam or the other tumbling out of the cupboard with regularity. It is noteworthy that the Comptroller and Auditor General has not come out with any reports recently though many of them s

Letters: No political standing

Apropos T N Ninan's column "PM as a politician" (Weekend Ruminations, January 4), addressing the lacklustre and last press conference of his two-term rule, Prime Minister Manmohan Singh said nothing new. His self-defence on governance failures was least convincing. While speaking in his official capacity as PM, it didn't behove Singh to make adverse comments on Narendra Modi, the Bharatiya Janata Party's prime ministerial candidate. The author aptly points out the double standards of Singh who, on one hand, said that the sins of the United Progressive Alliance (UPA)-I were washed away after the people voted UPA-II into power and, on the other hand, asserted that Modi still carries the baggage of the Gujarat riots despite having been elected thrice after the riots with massive majority. It is not for the Congress or Singh, but for the voters to decide whether Modi, as prime minister, will be a disaster or a saviour for India.M C Joshi, LucknowLetters can be mailed, faxed or e-mailed to:

Letters: Modi or not

This refers to T N Ninan's column "PM as a politician" (Weekend Ruminations, January 4). The Congress should not have held this press conference since the prime minister came off no better than the assessment of his critics. It was a sad farewell speech, more so when this economist while heading the United Progressive Alliance (UPA)-I, had largely delivered. But the politician in him remained enigmatic since he never went to town on his good performance. The unexpected windfall of 206 seats for the Congress in UPA-II only helped open up inherent fault lines in the party. As in UPA-I, the PM remained not only tongue-tied but inert to boot. That the UPA-II lasted for two years since late 2011 should be ranked as a political miracle. Even on the eve of his fading tenure, we saw apologetic references to the decade of achievements under his watch. It is frank to admit that Singh never intended to make history, but only to be judged by it. The damage done, the outgoing PM is content to warn

Letters: A sad farewell

When U K Sinha took charge as chairman of the Securities and Exchange Board of India (Sebi), his entry coincided with a one-time bonus for Sebi employees that could be used to splurge on household items such as furniture. Some employees chose to see this as an informal joining bonus from the new chairman, although the two events were a coincidence. All the same, when a recent news report suggested that Sinha may be granted an extension when his term ends next month, hopes rose again. But a repeat performance is unlikely, mainly because the expected extension is for a short period, so those hoping for new sofa sets may have to wait a little longer.

Sofa so good

Maybe AAP's decision to keep a lower profile with the press has partly to do with its inexperience in handling the fourth estate's assiduous attentions. After being mobbed by journalists during the metro ride to the Ramlila grounds for the oath-taking ceremony and during the first day at the office, the party leadership had banned media entry to the Secretariat. When the restrictions were lifted after protests, TV reporters met Education Minister Saurabh Bhardwaj, with each one looking for separate bytes for their channels. Bhardwaj eventually got so tired of repeating himself that when someone asked him about Chief Minister Arvind Kejriwal's health, he responded irritably, "I just hope I don't fall ill by tomorrow."

Hard Pressed?

The Aam Aadmi Party (AAP) effect is spreading rapidly. After competitive politics over power tariffs for consumers, politicians are now competing over their concern for homeless people and their plight on cold winter nights. Last week, AAP leader and Delhi's Women and Child Development Minister Rakhi Birla (pictured) did the rounds of night shelters in the national capital to gain a first-hand experience of the condition of the homeless. Soon after, Uttarakhand Chief Minister Vijay Bahuguna did the same in state capital Dehradun. The chief minister was accompanied by local MLAs and other officials. The key difference was that in Birla's case, the media was not invited, whereas Bahuguna followed all the formalities of publicity, including taking along a camera man and issuing a press statement.

Competitive concerns

Have merchants stopped taking soiled notes?Many restaurants and kirana stores have stopped accepting such notes after rumours about banks not accepting soiled or scribbled notes from January 1, 2014. The rumours were a result of a couple of Reserve Bank of India (RBI) circulars last year, which said banks should sort notes into re-issuables and non-issuables, issue only clean notes and stop writing on watermark window.What should one do if he owns soiled notes?Recently, RBI clarified that customers need not fear refusal of such notes from banks. Individuals can submit and exchange soiled or scribbled notes at bank branches. In case a bank staffer refuses to accept such notes, contact the controlling officer or the regional RBI office.

Tipping point

I recently got a mail from my bank saying they have approved a personal loan for me. But I had not even applied for one. Should I call the bank and tell them to cancel it? If the loan has been approved, does it mean I will have to pay interest on it? Many banks run a pre-approved personal loan programme for existing customers, under which the latter are eligible for a personal loan at preferred terms, which may include the rate, faster processing or easier documentation. You would have received this communication as your bank would have found you eligible under such a programme. On your specific query, while the loan may have been approved, no interest will be levied as long as you do not give your specific consent or sign the loan agreement documents.I had put Rs 50,000 in a five-year tax-saver deposit last year. The bank cuts TDS on that. But since it is a tax-saver, can they do it? In the Finance Bill of 2006, the government had announced tax benefits on bank fixed deposits with ten

Banking: Prashant Joshi

The party has already shaken up national politics

The AAP effect

Transparency and rules

A panel of experts share their insights on how to tackle the regulatory and legal challenges India Inc faces in the new year

A new legal landscape unfolds

Worldwide M&A totals $2,310 billion in 2013, a decrease of 2.4 per cent compared to year-to-date 2012, and is the slowest annual period for worldwide M&A since 2009. By number of deals, year-to-date M&A is down eight per cent compared to 2012 levels and is the slowest year-to-date period for deal making, by number of deals, since 2005

Worldwide M&A falls

Regulating Bitcoin?

The Urjit Patel committee, set up by Raghuram Rajan days after he took charge of Reserve Bank of India to review and strengthen the monetary policy framework, is expected to come out with its recommendations shortly - though it has missed the three-month deadline.The key question is whether the committee will emphasise on ending the discretionary monetary policy framework - in which multiple instruments are used to address a specific issue - to a rule-based framework that gives less headroom for manoeuvreing.While it may not be possible to shift to a rule-based regime from a discretionary regime overnight, it is to be seen how far the panel goes to strike a balance between the two.

Will Urjit Patel committee overhaul monetary policy framework?

Although the year 2013 didn't see much primary market activity, the few public offerings that saw good participation, such as Just Dial or PowerGrid, delivered good returns to investors. Just Dial, the largest IPO of 2013, has gained nearly three times from its issue price, while the recently concluded PowerGrid FPO, which saw 400,000 retail applications, has given almost 20 per cent returns to small investors. Interestingly, the BSE IPO index, a barometer for performance post listing, gained nearly three times in 2013. Besides nearly three dozen tiny IPOs by SMEs, last year was primarily dominated by offer for sales by companies with high promoter holding. Share sales by companies such as Tata Communications, Thomas Cook and AstraZeneca made good returns for investors

Silver lining amid dark clouds

The Central leadership of the Congress is yet to word a credible reply for its poor performance in the recent Assembly elections. This, however, has not stopped its state units to take corrective action, even if the solution defies logic. In Uttar Pradesh, oblivious to the upcoming elections, the state leadership is busy drawing renovation plans for its office in Lucknow these days. Apart from designing a guest house behind the palatial office, party leaders are pleased over obtaining permission from the forest department to cut around a dozen Ashoka trees that line the inside of the party office. When asked why, a leader replied they were "inauspicious".

Green electoral offshoots

Newly appointed Delhi chief minister and Aam Aadmi Party (AAP) leader Arvind Kejriwal's housing woes took up much column space in newspapers and on the social media forums as well, eliciting a variety of responses. While some conceded that the choice of the flat could not be compared to a chief ministerial bungalow in any way (such as Sheila Dikshit's sprawling bungalow), others were not so kind and equated the choice of a duplex flat to a betrayal of the ideals that AAP stands for. Jammu & Kashmir Chief Minister Omar Abdullah, a frequent user of Twitter, said, "No one will grudge Kejriwal (for) a 5 bedroom home, what they will grudge is poor delivery of election promises, so just let him move in and govern." Kejriwal has since decided against taking up the duplex and asked for a smaller flat.

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