Page 43 - Banks

India Post Payments Bank plans to double income in FY24: MD Venkatramu

India Post Payments Bank (IPPB) reported a net profit of 200 million rupees in 2022/23, Venkatramu said, as compared with a loss of 1.6 billion rupees in the previous year

UBS poised to keep Credit Suisse's domestic bank business, drop brand

The Zurich-based lender has set a target of winding down the Credit Suisse brand in the country, people familiar with the matter said

Banks, finance companies expect robust festive season credit offtake

Little room for rate-cut wars; tight screening to stay

Most corruption complaints against railways, bank officials in 2022: CVC

The highest number of corruption complaints last year were against employees of the Union home ministry, followed by those working for the railways and in banks, according to the Central Vigilance Commission's latest annual report. In total, 1,15,203 such complaints were received for all categories of officers and employees across central government departments and organisations in 2022, it stated. Of these, according to the report, 85,437 were disposed of and 29,766 were pending -- 22,034 for more than three months. The Central Vigilance Commission (CVC) has prescribed a time-limit of three months for chief vigilance officers, who act as a distant arm of the probity watchdog, to examine complaints, an official said. While the home ministry received 46,643 complaints against its employees last year, 10,580 were received by the railways and 8,129 by banks, according to the report. Out of the total complaints against home ministry employees, 23,919 were disposed of and 22,724 were ..

Give fixed rate option on EMI-based loans while resetting rates: RBI

The RBI on Friday directed banks to allow individual borrowers paying loans through EMIs to opt for fixed interest rate system or extension of loan tenor, a move aimed at preventing loanees from falling into the trap of negative amortisation, in wake of rising interest rate. The interest rates have moved northward since May 2022 after the central bank started raising the benchmark lending rate (repo) in a bid to check inflation following the outbreak of the Russia-Ukraine war. As a result of 250 basis points increase in the repo rate, a large number of borrowers faced negative amortisation, wherein the Equated Monthly Instalment (EMI) works out to be less than the interest obligation, resulting in persistent increase of the principal amount. RBI said that at the time of sanction of EMI-based floating rate personal loans, banks and NBFCs should take into account the repayment capacity of borrowers to ensure that adequate headroom is available for elongation of tenor and/ or increase

Provide borrowers option to switch to fixed interest rates: RBI to banks

The Reserve Bank on Friday asked banks and other lenders to provide individual borrowers an option of switching over to a fixed rate at the time of reset of interest rates. In a notification, it said in respect of EMI-based floating rate personal loans, in the wake of rising interest rates, several consumer grievances related to elongation of loan tenor and/or increase in EMI amount, without proper communication with and/or consent of borrowers have been received. In order to address these concerns, RBI asked entities regulated by it to put in place an appropriate policy framework. "At the time of sanction, REs shall clearly communicate to the borrowers about the possible impact of change in benchmark interest rate on the loan leading to changes in EMI and/or tenor or both. Subsequently, any increase in the EMI/ tenor or both on account of the above shall be communicated to the borrower immediately through appropriate channels," RBI said. It further said that at the time of reset o

Banks' lending to NBFCs soars 35% to Rs 14.2 trn in June: Care ratings

Banks' lending to non-banking finance companies (NBFCs) rose by 35.1 per cent to Rs 14.2 lakh crore in June, a report said. Credit exposure of banks to NBFCs rose by a robust 35.1 per cent on-year to Rs 14.2 lakh crore in June, indicating non-banking finance firms' decreased reliance on international borrowings. This also pushed up NBFCs' share in overall credit from 8.5 per cent in June 2022 to 9.9 per cent in the reporting month, according to Sanjay Agarwal, a senior director with Care Ratings. However, the report noted that the merger of HDFC with HDFC Bank, effective July 1, will lead to a reduction in the share and also the exposure of banks to NBFCs, as HDFC's bank borrowings will undergo a temporary reclassification, resulting in a shift of exposure to HDFC Bank. Meanwhile, mutual funds' debt exposure to NBFCs, including through commercial papers (CPs) and corporate debt, also increased 14.5 per cent to Rs 1.62 lakh crore in June, it said. According to the report, MF exposur

In fresh blow to China, shadow bank misses payments of investment products

Zhongrong International Trust has short-term liquidity troubles, the company's chief compliance officer Wang Qiang told dozens of investors at the company's headquarters in Beijing

Margin trends

Bank profits will moderate in coming quarters

Indian banks' operating environment strengthens as Covid risks ebb: Fitch

With banks shoring up their capital buffers and cleaning up their balance sheets following the pandemic, their gross non-performing asset ratio has fallen to a 10-year low of 3.9% as of March 2023

'Bad bank' sees loan transfers dwindle on valuation, liability woes: Report

NARCL, which started in July 2021 to buy 2 trillion rupees in bad loans, has bought 213.5 billion rupees of such loans as of July 17, according to a government statement to parliament

UBS ends Swiss govt's rescue packages that aided Credit Suisse takeover

UBS said Friday it has shut down rescue packages agreed with Swiss authorities that made available up to 200 billion Swiss francs (about USD 230 billion) to help shepherd through its takeover of ailing rival Credit Suisse and avert an international banking crisis. The Zurich-based banking giant, which completed the takeover on June 12, said it had moved to voluntarily terminate" rescue programmes that aimed to help mop up billions of losses and provide liquidity to the banks as they moved forward on the complex deal. UBS said it had repaid 50 billion francs in loans from the Swiss National Bank and 100 billion francs in liquidity support from the Swiss government, while ending a 9 billion franc loss protection agreement with the government. In total, UBS also paid some 730 million francs in commitment fees and risk premiums to Swiss authorities, comprised of 200 million to the government and 530 million to the national bank. Swiss authorities and UBS announced the hastily arranged

10% incremental CRR temporary, will drain out Rs 1 trn from system: RBI

Short-term rates on money market instruments like call money rates, treasury bills and commercial paper are likely to increase by 15-20 bps in the near term: ICRA

RBI to introduce framework to switch from floating to fixed interest rates

The Reserve Bank on Thursday said it will come out with a framework allowing borrowers to switch to fixed interest rate from floating interest rate, a move that would provide relief to borrowers of home, auto and other loans reeling under the impact of high interest rate. Unveiling the bi-monthly monetary policy, Reserve Bank Governor Shaktikanta Das said under the framework, to be put in place shortly, the lenders will have to clearly communicate with the borrowers about tenor and EMI. "The supervisory reviews undertaken by the Reserve Bank and the feedback and references from members of public have revealed several instances of unreasonable elongation of tenor of floating rate loans by lenders without proper consent and communication to the borrowers," he said. To address the issue, it is proposed to put in place a proper conduct framework to be implemented by all Regulated entities to address the issues faced by borrowers, he said. "The framework envisages that lenders should ..

Banks to maintain 10% additional CRR from Aug 12 as temporary measure: RBI

Action is part of central bank's efforts to reduce surplus liquidity, it says after monetary policy announcement

Large exposures carefully scrutinised; will remain vigilant in good times

The slippage went high due to the recognition of one mid-corporate account into NPA with an exposure of Rs 92 crore

Banks write off Rs 14.56 trn NPAs in last nine financial years: Centre

Banks have written off bad loans worth Rs 14.56 lakh crore in the last nine financial years starting 2014-15, Parliament was informed on Monday. Out of the total Rs 14,56,226 crore, written off loans of large industries and services stood at Rs 7,40,968 crore. Scheduled Commercial Banks (SCBs) have recovered an aggregate amount of Rs 2,04,668 crore in written-off loans, including corporate loans, since April, 2014 and up to March, 2023, Minister of State for Finance Bhagwat Karad said in a written reply to Lok Sabha. Loans written-off during the financial year, net of recovery in written-off loans during the financial year (net write-off) in public sector banks (PSBs) was Rs 1.18 lakh crore in the financial year (FY) 2017-18, which has declined to 0.91 lakh crore in FY 2021-22 and to Rs 0.84 lakh crore (RBI provisional data) in FY 2022-23, he said in another reply. Net write-off loans by private sector banks stood at Rs 73,803 crore (RBI provisional data) in FY 2022-23, he said. N

Five-day work week in banks soon as industry demand gets nod from IBA

The proposal has now been sent to the finance ministry for its final approval. If approved, all Saturdays will be declared as bank holidays

SBI Q1 results: Net profit up 178% to Rs 16,884 cr, NII rises 25%

Credit growth robust in all segments, says chairman of public sector lender

Banks' profitability may have reached peak, set to fall: Mckinsey

Banks' profitability may have reached its peak and is set to fall going ahead due to a slew of factors, global consultancy Mckinsey & Company said on Wednesday. The firm also said that the banking system is meeting less than a third of the credit demand for green finance, and recommended moves like inclusion of such finance under priority sector lending and creating a credit guarantee platform. Aspects like rise in deposit costs due to the lagged effect of rate hikes and the war for deposits, higher operational costs on tech spends and hiring of specialized talent, and higher credit costs as the stress on the books goes up will hurt the profitability, its senior partner Peeyush Dalmia told reporters here. "We expect RoAs (return on assets) to absolutely fall..., if I were to take a 12-18 month view, it will (fall) absolutely," he said, pointing to his outlook on the key ratio arrived at by dividing net income with the total assets. Dalmia said in the next 24-30 month period, he ...