SBI to open 8 new branches & 63 ATM counters in Tripura

State Bank of India (SBI) will open eight more new branches and 63 new ATM counters and increase the Credit Deposit ratio to give more service to the customers in Tripura, official sources said today.

Chairman of SBI, Pratip Chowdhury yesterday met Tripura Chief Minister Manik Sarkar and assured that the CD ratio would be increased to 50 per cent by the next fiscal and eight more new branches and 63 new ATM counters would be opened in the state.

At present the CD ration is about 34 per cent. Sarkar requested Chowdhury to open more new branches in the rural areas, especially in the tribal compact areas.

Chowdhury said the SBI would be interested to give more loans to the entrepreneurs for development of industries and added that low industrialisation in the state was one of the causes for low credit deposit ratio.

At present there are 51 branches of the bank and 108 ATM counters in Tripura.

Source: EconomicTimes

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Inflation down to October 2009 levels, but weak rupee stems chances of rate cut

Headline inflation slowed to a 43-month low in May, partly prompting a 350-point rally of the BSE Sensex, but fears of a weak rupee stoking prices might prevent the central bank from slashing interest rates at its policy meeting on Monday.

Wholesale price index based-inflation eased to 4.70 per cent, the lowest since October 2009, and the rupee strengthened by 40 paise to 57.60 to a dollar as banks and exporters sold greenbacks.

While industry responded to the lower inflation numbers by calling for a cut in policy rates, experts felt the Reserve Bank of India may desist from doing so as retail inflation remains high and rising imports could increase the country's current account deficit. "Given the recent rupee volatility, latest CPI (consumer price inflation) at 9.3 per cent and the possibility of a weak trade deficit print in May, we expect that the RBI is more likely to cut rates in the July 30 meeting and not on June 17," Citigroup chief economist Rohini Malkani said in a note.

ICRA's senior economist Aditi Nayar said despite poor industrial growth, mounting concerns about the size of the current account deficit might result in the RBI desisting from monetary easing in the policy review.

The RBI is under pressure from the government and industry to cut rates to boost investment and spending to kickstart the Inflation down to October 2009 levels, but weak rupee stems chances of a rate cut economy. It has cut interest rates by 1.25 percentage points since April last year, but this only partly offsets the 3.75 percentage point increase that took place between early 2010 and late 2011.

Food inflation rose to 8.25 per cent in May, compared to 6.08 per cent in April. The expectations of normal monsoon keeping food inflation down is likely to be dampened by the over 7 per cent rupee depreciation since May which may exacerbate inflation of imported items in the food category.

Manufactured products inflation and fuel inflation both fell last month but the weakening rupee could play spoilsport. "Manufactured products and fuel will be impacted the most on account of rupee depreciation," said Madan Sabnavis, chief economist, CARE Ratings.

Core inflation subsided to 2.4 per cent, during the month versus 2.7 per cent in April, lowest since December 2009. Headline inflation has fallen steeply this year because of a drop in food and commodity prices as well as falling demand for manufactured products.

But D K Joshi, chief economist, Crisil said the gains from lower commodity prices would be offset by inflation in imports, because of the rupee fall.

FICCI president Naina Lal Kidwai said the WPI figures signaled that prices have been reined in and RBI could consider a cut in the rate on Monday. "The growth in the non food credit has not really picked up... cost of credit still remains an issue, and especially so for the small and midsized firms," said Kidwai.

Source: EconomicTimes

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Engineers, MBAs join up as assistants in SBI

At a time when the chips are down in the economy and the threat of downsizing looms in the private sector, candidates with professional qualifications are finding entry level jobs in public sector banks attractive.

This is seen in the recruitment trend in State Bank of India and the scenario is not different in other public sector banks .

Though the qualification for the Assistant’s position, the lowest rung in mainline banking operations, is 12{+t}{+h} class (with minimum 60 per cent aggregate marks) or a degree from a recognised university, SBI has managed to attract candidates with professional qualifications in computer engineering and business administration.

Expansion of the branch network, coupled with the need to mitigate staff shortage, particularly at rural and semi-urban branches, saw SBI recruiting 20,682 new Assistants in FY2013.

More than 30 lakh candidates appeared for the test for the Assistants’ position.

Fast-track promotion

A senior public sector banker said given the fast-track promotion process in public sector banks, an Assistant can hope to retire as a General Manager.

“There are cases whereby a candidate joins a bank as an Assistant but aims for the Probationary Officer’s (PO) position. Once, the candidate cracks the PO exam and gets selected, he can even rise to be a Deputy Managing Director (in SBI) or a Chairman and Managing Director (in a public sector bank), if he is a fast-tracker,” he said.

In the financial year ended March 31, 2013, SBI recruited 847 probationary officers. Seventeen lakh candidates applied for officers’ position.

As on March-end 2013, the bank had 2,28,296 employees (2,15,481 as on March-end 2012) on its rolls, comprising 80,796 Officers, 1,09,686 Assistants, and 37,814 Subordinates.

During the year, the bank added 719 branches, taking the total number of branches to 14,816. Of these, 66 per cent of the branches are in rural and semi-urban areas.

“The large scale recruitment of Gen-next employees in the officers as well as in the Assistant grade have not only brought a far-reaching attitudinal change among staff in their customer interface and services across branches, it has also become a catalyst in enhancing/ improving the productivity and efficiency of employees,” SBI said in its annual report.

In FY2013, SBI’s business per employee and net profit per employee rose to Rs 9.44 crore (Rs 7.98 crore in FY2012) and Rs 6.45 lakh (Rs 5.31 lakh).

ramkumar.k@thehindu.co.in

Source: thehindubusinessline

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RBI likely to cut policy rates by 0.25%; keep CRR unchanged: HSBC

The Reserve Bank of India is likely to cut policy rates by 0.25 per cent and keep the cash reserve ratio unchanged at its policy review next week, on the back of slower—than—expected growth and more encouraging inflation readings, says a report by HSBC.

“From the RBI’s perspective, the slower—than—expected growth and recently more encouraging inflation readings should pave the way for another 25 bps rate cut on June 17, but we do not expect a cut in the CRR with the liquidity deficit (as on June 12) hovering near the RBI’s comfort level,” HSBC said in a research note.

The foreign brokerage firm further said, “We will, nevertheless, not preclude the possibility that the recent weakness in the INR could keep the RBI on hold in June.”

In the last policy announcement on May 3, the central bank had cut its key rate of lending, the repo rate, by 0.25 per cent.

“Following this policy rate cut, the room for additional monetary policy easing is limited, and we only expect one more rate cut of 25 bps. Next year, the RBI will need to hike rates again, in our view,” HSBC said.

HSBC expects another 25 bps cut in the July—September quarter as well.

Looking ahead, more progress on structural reforms would help to gradually improve growth prospects. Moreover, stepped —up implementation of infrastructure projects expedited through the Cabinet Committee on Investment (CCI) will also help aid the recovery, the report said.

However, the recovery is likely to prove to be very protracted as it takes time for the reforms to kick in.

Based on this, HSBC expects growth to recover to 5.5 per cent in FY14 and 6.6 per cent in FY15.

Source: thehindubusinessline

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Vijaya Bank agri loan mela

Vijaya Bank held a mega agriculture loan mela at its branch at Pavagada, near Tumkur. H. S. Upendra Kamath, Chairman and Managing Director inaugurated the mela. Speaking at the function Dr D. Nuthan, Associate Director of Research, University of Agricultural Sciences, GKVK, spoke about the agriculture scenario. During the mela, sanction letters were distributed to farmers under crop loan, allied activities, investment credit and indirect finance to agriculture and 48 self-help groups (SHGs) were linked. Agricultural Research Station professors Dr Chalapthi and Dr Prabhu Ganiger also attended the function.

Source: thehindubusinessline

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29 Axis Bank accounts hacked, Rs 13 lakh withdrawn from ATMs

A total of 29 Axis Bank accounts, including 12 salary accounts of Mumbai police personnel, were hacked in April and May.

Agency reports quoting the police said a sum of Rs 13 lakh was withdrawn through ATMs in Greece from 29 accounts.

Some of the policemen in the city had received SMS messages that cash has been withdrawn from their Axis Bank accounts in euro currency, it said.

An Axis Bank spokesperson said, “A small number (less than 50) of our customers’ accounts have been impacted through transactions at compromised ATMs in Mumbai ‘belonging to multiple banks’.

“We have reversed the impact in all such customers’ accounts with immediate effect to ensure they are not inconvenienced. We are undertaking a full investigation into the incident and are working closely with law enforcement officials in this regard.”

According to Govind Rammurthy, MD and CEO, eScan, there is also a possibility of customers being victims of skimming and / or card cloning. Since all the account holders were from the same bank, it is likely that there exists a rogue skimmer which targets the customers of the bank.

Alternatively, there may also exist a card cloning racket that swipes the cards of the users with the intention of grabbing the card-data, he said.

Police claimed that the debit cards have been cloned and the withdrawal done in Greece. An FIR will be lodged soon in this connection, it is said.

beena.parmar@thehindu.co.in

Source: thehindubusinessline

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S K Roy is new chairman of LIC

The government is understood to have appointed S K Roy as the Chairman of Life Insurance Corporation of India (LIC).

Roy, who is presently a Managing Director in the organisation, would be succeeding D K Mehrotra, whose term as LIC chief ended on May 31.

Roy would be at the helm of the insurance behemoth for a period of five years, official sources said, adding that the notification to this effect would be out soon.

The other candidates who were in fray for this top job were Managing Director Sushobhan Sarkar and executive director S B Mainak.

Roy joined the largest insurance company in the country in 1981. On May 31, 2013, he assumed charge as Managing Director of LIC along with Thomas Mathew and Sarkar.

Prior to elevation, he was head of the International Operations. He was also zonal manager of North Central Zone and Eastern Zone of the insurance firm.

LIC, which manages assets worth around Rs 14-lakh crore of over 20 crore policyholders, has the largest market share among 24 players in the industry.

Source: thehindubusinessline

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Crisil assigns AA+ rating for United Bank tier-II bonds

Rating agency Crisil today said it has assigned ‘AA+’ rating with a stable outlook to the proposed Rs 500 crore tier-II bonds issue of public sector lender United Bank of India.

As per the agency, this is the first tier-II capital instrument issued in the domestic market under the Basel III capital regulations.

“This showcases Crisil’s continued commitment towards making markets function better and enabling innovation in domestic debt markets. This also sets in motion the issuance of Basel III compliant capital instruments by domestic banks and is a critical step towards tapping bond markets for banks’ capital requirements,” Pawan Agarwal, Senior Director, Crisil said.

He said the rating action has taken into account the continuance of strong support from the government, the bank’s healthy resource profile and adequate capitalisation.

Source: thehindubusinessline

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SBI declares results of written exam for officer posts

State Bank of India (SBI) has announced the results of the written examination for recruitment of probationary officers.

As per the notification available on its portal today, qualified candidates must download the interview call letters and biodata format from June 18. The second phase of exam consisting of group discussion and interview would commence from July 3.

The result is much-awaited as over 17 lakh candidates had applied for 1,500 vacancies for which the written examination was conducted on April 28, 2012. This was the highest number of applicants SBI had received in recent times.

A probationary officer in SBI earns a maximum salary of up to Rs 69,000 a month in Mumbai, while it would be around Rs 50,000 in other places.

Public sector banks are now seen as largest employers and as per provisional figures, they are likely to hire over 60,000 officers and clerks in the current financial year.

naga.gunturi@thehindu.co.in

Source: thehindubusinessline

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IndusInd Bank ties up with Western Union for remittances

Private sector lender IndusInd Bank has tied up with Western Union Business Solutions, a unit of the Western Union Company, which will provide technology platform for effecting foreign exchange payments for small and medium enterprises (SMEs) in India.

The bank has further signed up two of Western Union’s licensed agents, Weizmann Forex and Paul Merchants, as referral agents to help market the service in the country, the company statement said.

The service goes live in 22 cities across the country and aims to provide doorstep service to the Clients.

“While the larger corporate houses manage to get the best deals for their remittance transactions, it has been seen that the SME segment do not get the same level of services. We are confident that this technology offering will help us bring delight to this segment of customers”, said Ramesh Ganesan, Executive Vice President, IndusInd Bank.

“Small and medium-sized enterprises are essential to India’s economy,” said Raj Agrawal, President, Western Union Business Solutions. “There are nearly 30 million Indian SMEs that together make a significant contribution to the country’s GDP. This arrangement will not only bring improved access to foreign exchange products for SMEs but will also increase the ease and efficiency with which they trade with their global partners.”

Source: thehindubusinessline

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HSBC lowers India’s FY14 growth forecast to 5.5% from 6%

Global financial giant HSBC lowered India’s growth forecast for this fiscal to 5.5 per cent from 6 per cent citing slow reform process.

HSBC said growth has been in line with its expectations in 2013, but slower reform progress will delay the recovery.

“While we expect further progress on reforms, it will only materialise slowly. Moreover, the global recovery is likely to come later. The recovery in India will, therefore, prove even more protracted,” HSBC said in a research note.

HSBC has, consequently, cut growth forecast for FY2014 to 5.5 per cent (vs 6 per cent) and FY2015 to 6.6 per cent (vs 7.1 per cent), the note said.

India’s economic growth rate slipped to a decade low of five per cent in 2012-13 on account of poor performance of farm, manufacturing and mining sectors.

The government has pushed through numerous reform measures over the past nine months. However, implementation and announcements have tapered off recently and could slow even further, it said.

“This monsoon parliamentary session will prove an important test for the government’s ability to sustain the reform push,” HSBC said.

There are a number of key bills like — land acquisition bill, insurance bill, pension bill — that are likely to be voted on during the ‘monsoon’ parliamentary session that starts in July/August.

On the inflation front, HSBC said the decline in global commodity prices is likely to continue in the near term, but, in the second half of the fiscal year, inflation is likely to gradually pick up, as growth recovers and global commodity prices firm.

“While we forecast the current account deficit to narrow in coming years, it will remain elevated and a concern,” HSBC said.

Source: thehindubusinessline

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RBS to cut 2,000 more jobs as chief steps down

Royal Bank of Scotland was on Thursday expected to announce a further 2,000 jobs cuts, a day after chief executive Stephen Hester announced he would step down later this year.

The job cuts, expected to affect its global investment arm, are the latest since RBS was bailed out by the Government during the financial crisis. It has already cut more than 30,000 jobs since 2008.

Shares in the 81 per cent taxpayer-owned bank plunged by 7 per cent after the news broke.

Hester’s departure after five years spent overseeing the bank’s restructuring “increases the uncertainty around the shares and potentially delays further any return of the bank to private ownership,” said Gary Greenwood, an analyst.

The bank has now launched a search for a successor to Hester, whose leaving package includes a full year of pay, benefits worth 1.6 million pounds ($ 2.5 million) and a possible 4 million pound shares windfall from a long-term incentive scheme.

The bank made a loss of 5.2 billion pounds last year but returned to profit in the first quarter of 2013.

Source: thehindubusinessline

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Chidambaram to ask PSU bank chiefs to cut lending rates

Finance Minister P. Chidambaram said that he has called a meeting of PSU bank chiefs and would persuade them to pass on the benefit of RBI rate cut to borrowers.

“I have called the chairpersons of public sector banks towards the end of this month and have a chat on these issues.

We will talk to the banks. I think they are cautious. Caution is good, but you can’t be overcautious,” he told reporters here.

Chidambaram said that although RBI has reduced the policy rates by 1.3 per cent since January 2012, banks have lowered the lending rates by only 0.3 per cent.

The industry has been complaining about the reluctance of banks to pass on the benefit of rate cut to corporates and retail borrowers.

Asked about his expectations from the Reserve Bank’s mid-quarter policy review scheduled on June 17, Chidambaram said: “What I want to tell RBI, I tell RBI quietly and indirectly. I like them to take correct decisions.’’

The pressure is mounting on RBI to cut the interest rates to boost industrial growth, which declined to 2.2 per cent in April.

The Minister further said that PSU banks would require Rs 15,000-20,000 crore worth capital annually for the next five years to meet the global capital adequacy norms.

According to Chidambaram, the whole proceeds of disinvestment would be used for meeting the capital needs of PSUs, including banks.

Source: thehindubusinessline

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Indian Bank, United India launch Web portal

Indian Bank and United India Insurance Company have launched a Web portal for mediclaim group insurance policies.

The portal was unveiled by T. M. Bhasin, Chairman and Managing Director, Indian Bank, and Milind A. Kharat, Chairman and Managing Director, United India Insurance. Indian Bank has been offering a co-branded group mediclaim insurance policy, Arogya Raksha group mediclaim insurance policy, to its customers since 2006. In 2012-13, it had mobilised non-life business of Rs 31 crore for United India Insurance, earning a fee-based income of Rs 3.23 crore, says a press release.

Source: thehindubusinessline

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Bank of Baroda zonal head

R. P. Marathe, General Manager, Bank of Baroda, took charge as the zonal head of Karnataka and Andhra Pradesh zone of the bank. Prior to this assignment, Marathe was the General Manager heading the strategic planning, data warehouse and MIS department of the bank at the corporate office, Mumbai.

Source: thehindubusinessline

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Axis Bank unveils co-branded credit card

Axis Bank on Tuesday launched a new co-branded credit card targeting affluent customers.

The card holders can get a discount of 20 basis points on home loans from the bank with a 50 per cent concession on processing charges.

Further, the card holders will be provided with reward points which can be redeemed with Miles & More’s partners across sectors such as flights, hotels, resorts, car rentals and retail stores among others. Miles & More is a Europe-based international frequent flyer program.

The card is available in two variants —World Select and World — with a joining fee of Rs 10,000 and Rs 3,500 respectively. The annual fee on World Select and World cards is Rs 4,500 and Rs 3,500, respectively.

It combines insurance and travel benefits for international frequent flyers and gets them access to Lufthansa and other member airlines’ programs.

In 2008 the credit card industry was at its peak. However, the slowdown that followed led to de-growth.

Card spends

“Over the past 12 months, customer interest and usage of credit cards has increased with overall card spends in the industry going up by over 30 per cent last year,” said Jairam Sridharan, Head Consumer Lending and Payments, Axis Bank.

Currently, the loan outstanding on Axis Bank’s credit cards is about Rs 1,200 crore, accounting for about 2 per cent of its retail book.

The bank has about 1.1 million credit card customers, while the total outstanding cards in the banking industry stood at 19.5 million as on April 2013.

beena.parmar@thehindu.co.in

Source: thehindubusinessline

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Oriental Bank cuts domestic term deposit rates

Oriental Bank of Commerce (OBC) has reduced the interest rates on certain domestic term deposits.

Interest rates have been cut by 25 basis points on domestic term deposits (including NRO deposits) under various maturities for 270 days and above of term deposits of less than Rs 1 crore.

For deposits of less than Rs 1 crore, the deposit rate on maturity period of 270 days to less than 1 year has been reduced from 8.5 per cent to 8.25 per cent.

For deposits with maturity period of one year to less than two years, the deposit rate has been lowered to 8.75 per cent from 9 per cent earlier.

There has been a 25 basis points cut in interest rates in other buckets — two years to less than three years, three years to less than five years, and five years to ten years as well.

The revised rates have come into effect from monday. This move is being seen as a precursor to review the bank’s base rate, which stood at 10.25 per cent.

With interest rates in the system softening, there may be increased pressure on public sector lenders to further reduce their lending rates. Already, there is some criticism that banks have not reduced their lending rates commensurate to the reduction in policy rates by the RBI.

Despite the latest reduction in deposit rates, OBC will aim for a higher net interest margin of 2.9 per cent this fiscal, V. Kannan, Executive Director, OBC said.

OBC had closed last fiscal with a net interest margin of 2.82 per cent.

srivats.kr@thehidu.co.in

Source: thehindubusinessline

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YES Bank gets court nod to advance board meeting to June 27

The Bombay High Court on monday directed YES Bank to advance its board meeting to June 27 to consider the appointment of its late founder’s daughter Shagun Kapur Gogia as the director on the bank’s Board.

Earlier, the mid-sized private sector bank was to hold the board meeting on July 24. The next hearing by the High Court on the appointment of the directors will be on July 1.

Gogia is the daughter of Ashok Kapur, who had co-founded YES Bank with his brother-in-law Rana Kapoor in 2004. Ashok Kapur passed away in the 26/11 terror attacks following which his stake in the bank was transferred to his wife Madhu Kapur.

Lawyers of Madhu Kapur and her daughter Gogia told the court that the voting for the election of three board of directors – Diwan Arun Nanda of advertising firm Rediffusion, banker Ravish Chopra and nuclear scientist M.R. Srinivasan, was not in consultation with them as per shareholders’ rights.

YES Bank on monday announced that Diwan Arun Nanda, Ravish Chopra and M.R. Srinivasan were elected as directors at the bank’s ninth annual general meeting held on Saturday. A poll was conducted and the general body of shareholders passed the resolutions relating to their appointment with a majority of 80 per cent in their favour.

The judge said "The bank must advance its board meeting to June 27 and consider the recommendation of appointing Gogia on the Board...without aggravating the situation."

The confirmation of the three directors now remains delayed till June 27.

The YES Bank stock ended down 2.57 per cent at Rs 490.15 on the Bombay Stock Exchange.

To raise Rs 500 m

Meanwhile, the bank plans to raise $500 million during this year through a combination of instruments aimed largely at institutional investors. In a press release, YES Bank said that the shareholders gave their nod to the fund-raising proposal at the bank’s AGM held on June 8.

According to YES Bank MD and CEO, Rana Kapoor, the bank would raise this amount “potentially through GDRs (global depositary receipts) in combination with a QIP (qualified institutional placement) and domestic institutional investors (DIIs) in order to ensure fullest and widest participation of all investor classes’’.

According to the BSE data, the promoters hold 25.72 per cent stake in the equity of the bank, while FIIs hold 48.95 per cent as at the end of March 31, 2013. DIIs hold 13.23 per cent equity and others hold 12.10 per cent.

Source: thehindubusinessline

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Cobrapost expose: RBI fines 3 private banks for violating KYC norms

The Reserve Bank of India on Monday penalised top three private sector banks — ICICI Bank, HDFC Bank and Axis Bank — for violating, among others, know-your-customer (KYC) norms and failing to file cash-transaction reports in some cases. It levied a penalty of Rs 1 crore, Rs 4.5 crore and Rs 5 crore on ICICI Bank, HDFC Bank and Axis Bank, respectively.

The central bank, however, said its investigation of these banks did not reveal any prima facie evidence of money laundering. It observed that any conclusive inference in this regard can be drawn only by an end-to-end investigation of the transactions by tax and enforcement agencies.

The RBI scrutinised books of accounts, internal control, compliance systems and processes of the banks’ corporate offices and some branches during March-April 2013. This was to investigate the allegations of violation of several RBI regulations, Foreign Exchange Management Act guidelines, and so on, made by online magazine Cobrapost.com in a sting operation.

Based on the findings of the scrutiny, the Reserve Bank issued a show-cause notice to each of these banks, in response to which they submitted written replies. A similar scrutiny was also conducted at the corporate offices of 36 other banks during April and May 2013. The process of follow-up action in respect of these banks is at different stages of completion, the RBI said.

The scrutiny of the three banks revealed violations such as non-adherence to certain aspects of KYC norms and AML (anti-money laundering) guidelines.

It also found non-adherence of KYC for walk-in customers, including for sale of third-party products, omission in filing of cash transaction reports in respect of some cash transactions, sale of gold coins for cash beyond Rs 50,000.

The other violations found by the RBI include not obtaining PAN (permanent account number) card details from customers, non-verification of source of funds credited to a few non-resident ordinary accounts, and non-observance of certain safeguards in respect of arrangement of “at par” payment of cheques drawn by cooperative banks.

beena.parmar@thehindu.co.in

Source: thehindubusinessline

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Dept of Posts to move Cabinet note to apply for bank licence

 The Department of Posts will move a Cabinet note in order to apply for a banking licence by the stipulated deadline of July 1, a senior official has said, even as a top Finance Ministry went public with doubts over the efficacy of the post office being converted into a bank.

“We are moving a cabinet note now and after that we will be applying for the licence. After the cabinet note, we will go ahead with setting up the bank,” Postal Services Board’s member, planning, Suneeta Trivedi, told PTI here.

Trivedi asserted that the Department will be making the application by July 1, which is the last date set by the Reserve Bank for receiving applications.

The department of Posts has engaged consultancy firm Ernst & Young for helping it at the application stage by creating the “whole concept” of the bank and has already gathered all the know-how to enter the fray.

However, Department of Financial Services Secretary Rajiv Takru seemed to be not so much interested at the prospect of India Posts entering the banking fray.

There is a lot more to banking than merely having the reach and opening savings accounts, he told reporters, adding that it also involves very complex things at the back end and seemed to suggest that a Japan-like case, where the postal department has a bank, may not work in the country.

When asked about the same, Trivdei said, “We have worked out all on know how, about everything. There is nothing like that” and added that there is no rethink on the part of the Postal department.

Sector watchers suggest that if financial inclusion is the ultimate aim in granting new licences in this round, the entry of the department will be highly beneficial to the agenda being pursued by the Reserve Bank and the Government.

Source: thehindubusinessline

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Yes Bank director election drama in suspense

The contentious appointment of three directors to the board of Yes Bank is in suspense with it going to ballot at the shareholders meet, whose result will be declared on Monday.

But it is believed that the voting strength is in favour of the appointment will ensure that Diwan Arun Nanda, Ravish Chopra and MR Srinivasan. Although promoters' voting rights are capped at 10%, the presence of a lot of staff and shareholders loyal to the management might have voted in favour of the appointments.

Even as results are awaited there are murmurs that there are disputes about the way it is proceeding which may lead to the outcome getting challenged in the court.

Reacting to these murmurs M.R. Srinivasan, chairman, YES Bank said,"The voting process and the subsequent counting process; is proceeding in the fullest conformity with the instructions of the Chairman of the Meeting, and in consonance with the General meeting guidelines as contained in the Articles of Association. The ongoing counting process is being conducted by the two appointed scrutineers and Karvy - the Registrar of YES BANK. On a request from Mrs. Madhu Kapur, as a special case the Chairman has permitted the presence of her authorized representative - Mrs. Shagun Gogia to be an observer of the complete process, to provide necessary comfort."

"YES BANK being a Public Trust institution, kindly ensure that there is responsible reporting on the subject," he said.

Rana Kapoor did not comment on the matter and the media was barred from covering the shareholders'event.

``They want their right to nominate a director on the board. Madhu Kapur is not in favour of the appointment of directors so she demanded a poll,'' said one of the proxis of Madhu Kapur, wife of the last Ashok Kapur, the co-founder of Yes Bank. ``Few of the other shareholders also asked for a poll.''

The appointment of three directors is sought to be stalled by the Kapur family demanding consultations as provided in the Articles of Associations of the bank. The representatives of Kapur allege that the other founder and Chief Executive of the bank Rana Kapoor is not consulting them on appointments.

``Ashok Kapur, like Rana Kapoor, is termed as an Indian partner in the bank documents,'' said an associate of Kapur at the venue of the shareholders' meet but did not want to be identified by name. ``The articles of association gives Ashok Kapur family equal right on appointment of directors.''

Two shareholders questioned the CEO Kapoor on the ongoing family dispute, but there was no answer, said a shareholder.

Source: economictimes

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SBI authorised to file recovery suit against Kingfisher Airlines

Lenders plan to open a new ‘recovery’ front to realise their dues aggregating about Rs 7,000 crore from the defunct Kingfisher Airlines. They have authorised the State Bank of India to file recovery suit against the airline in the debt recovery tribunal.

The lenders have also given their consent to SBI to proceed against the guarantors of loans given to the Vijay Mallya-promoted KFA, said a banker privy to the consortium meeting held last week.

This development comes even as the 17-bank consortium, led by SBI, has sold off shares of Mangalore Chemicals and Fertilisers Ltd pledged by the airline’s promoter. The consortium is also realising its dues by selling the pledged United Spirits Ltd (USL) shares in tranches. The sale of USL shares by banks started in March even as the open offer by Relay B.V., an indirect wholly-owned subsidiary of Diageo Plc, for United Spirits’ equity shares was on.

The open offer, which closed on April 26, met with tepid response from public shareholders as the offer price was lower than the ruling market price. A total of 58,668 shares were tendered by the public shareholders of USL and accepted by Relay B.V. as against the target of acquiring up to 37,785, 214 equity shares, according to USL’s filing with the BSE. It may be recalled that the Kolkata-headquartered United Bank of India has independently filed a winding-up petition in the Karnataka High Court against United Breweries Holdings Ltd. The public sector bank moved against UBHL as it stood guarantee for loans taken by KFA.

So far, banks have realised about Rs 1,000 crore from KFA by selling the low-hanging fruits — pledged Mangalore Chemicals and Fertilisers Ltd and USL shares.

Bankers say they are bracing for a legal challenge as making recoveries from the pledged immovable properties such as Kingfisher House in Mumbai and a villa in Goa as well as pressing guarantors for making good the guarantees could prove an uphill task.

ramkumar.k@thehindu.co.in

Source: thehindubusinessline

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Yes Bank holds paper ballot for directors appointment after dissent

Private sector Yes Bank was forced to resort to paper ballots for appointment of three new directors on its board following dissent from one of the founding families.

The Annual General Meeting (AGM) of Yes Bank was to approve appointment of Diwan Arun Nanda, Ravish Chopra and MR Srinivasan as wholetime directors by voice vote.

Three directors were sponsored by bank MD & CEO Rana Kapoor -- who holds 13.72 per cent stake in the bank -- but were opposed by Madhu Kapur, wife of late Ashok Kapur and co-founder of Yes Bank.

Madhu Kapur, who holds 12 per cent stake in the bank, wants a say in board appointments.

Shareholders attending the AGM said when the subject was taken up, Kapur opposed the move.

Following this, members were asked to cast paper ballots and results of the same will be known in 48 hours, they added.

An Yes Bank spokesperson refused to comment on the issue. The events come a day after Bombay High Court turned down a petition filed by Madhu Kapur objecting to the holding of AGM on the ground that they had not been consulted before appointment of directors.

According to shareholders present at the meeting, Kapur expressed dissent against the appointment of the directors due to which the AGM held at the bank's headquarters Nehru Centre, had to carry out the voting.

Ashok Kapur, who died in 26/11 terror attacks at the Oberoi Hotel in Mumbai, had co-founded the bank with his brother-in-law Rana Kapoor and Rabobank in 2004.

As per sources, the feud between families of two founder members had started in 2009 after the board of Yes Bank declined to induct Shagun Gogia, the daughter of late Ashok Kapur as a nominee board member.

The board of the bank had declined to induct Gogia saying that she might not be eligible as per 'Fit and Proper' criteria laid down by the Reserve Bank, sources said.

However, one of the close associates of Shagun Gogia, said: "It is for the RBI to decide if Shagun is 'fit-and-proper' or not. Rana Kapoor cannot decide this unilaterally."

When pointed out that if the bank board does not pass her name, then it cannot be sent to the RBI, Gogia's close associate said, if the board does not pass her name, then they will have to approach the High Court.

Meanwhile, one shareholder attending the AGM  said that the issue should be sorted out as soon as possible, which otherwise would affect the reputation of the bank.


Source: economictimes

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T.M. Bhasin re-elected as IBA Deputy Chairman

T.M. Bhasin, Chairman and Managing Director of Indian Bank, has been re-elected as Deputy Chairman of Indian Banks’ Association (IBA) for 2013-14 by the IBA managing committee.

The decision was taken at IBA’s 66th annual general meeting.

Bhasin will also be the Chairman of IBA’s Human Resources Committee and chair the ongoing wage negotiations with the United Forum of Bank Unions for the 10th bipartite discussions.

Source: thehindubusinessline

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