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Tuesday, February 24, 2015

HSBC India headcount up by 1,000 in 2014

At the centre of a probe into black money allegedly stashed by Indians in Swiss banks, global banking giant HSBC increased its headcount in India by 1,000 last year to 32,000 - the second highest after the UK.

As per the bank’s latest annual report, it had a total worldwide workforce of 2,66,000 full-time and part-time employees at the end of 2014.

This marked an increase from 2,63,000 at the end of 2013, but still below 2,70,000 at the end of 2012.

India has been ranked second among its “main centres of employment” after the UK, where it employed 48,000 persons.

The Indian headcount has risen from 31,000 at the end of 2013, while that in the UK has also grown from 46,000.

On the other hand, the US headcount has fallen from 16,000 to 15,000, the bank said in its annual report.

The bank has listed India as one of the seven ‘priority growth markets’ within Asia.

The India headcount rose for the second consecutive year in 2014, after dipping for the four straight years till 2012, when its total employee base in the country stood at 30,000.

The UK-based global banking giant had as many as 37,000 employees in India at the end of 2008.

HSBC is facing a multi-nation probe for “alleged tax evasion, money laundering and unlawful cross-border banking solicitation” and it disclosed yesterday that it has been served summons by the Indian tax department as well.

A leaked list of over one lakh account holders in HSBC’s Swiss banking unit, including 1,195 Indians, recently became public, prompting authorities in India and many other countries to launch their investigations to ascertain whether these accounts had illicit money stashed abroad.

The bank has also received “subpoenas and requests for information” from the U.S. and other authorities with respect to certain U.S.-based clients of an HSBC company in India. This case relates to some NRIs facing investigation in the U.S. for alleged violation of the American tax laws.

Financial performance

HSBC saw its revenue and profits rise in India last year even as it reported a 17 per cent fall in global profits for 2014. Its India revenue rose by 10 per cent to USD 1.83 billion, while profit was up 7 per cent to USD 700 million.

The bank said the economic recovery in India remained constrained last year, although a new government with a strong mandate boosted market sentiments.

Announcing its full-year results, the bank also said that its operations are exposed to various “geopolitical risks” which increased during 2014 and included high tensions over the line of control between India and Pakistan.

The bank continued to grow its balance sheet in India in commercial banking, particularly by helping UK corporations to invest in India during 2014.

In global banking and markets segment also, HSBC was adviser on two of the largest M&A transactions in the country in 2014, and in Wealth Management it launched Managed Solutions, a multi-asset fund series.

Source : Thehindubusinessline
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Happay, Ratnakar Bank launch debit card with expense mgmt system

Sony Jacob, the Finance and Accounts head at Bangalore-based micro-brewery Windmills Craftworks, is a happy employee ever since his company started using Happay Cards to manage the company’s employee expense.

Jacob said the card, which is integrated with mobile and web dashboard, automatically records and verifies the data and hence can directly be imported into accounting. “Earlier we used to dedicate one person especially for petty cash settlement, checking for supporting documents. Now with Happay Cards, the process has become streamlined and paperless. We are also spending 70 per cent less time in managing expenses,” Jacob added.

Meanwhile a Bangalore-based entrepreneur and restaurateur Griffith David also uses Happay Cards for his small firm.

Happay Card is a product of start-up Happay, founded by IITians from Kharagpur, Anshul Rai and Varun Rathi in 2012. It is one of its kind, business expense management solution that streamlines an organization’s expense workflow from end-to-end (expense reporting to accounting) and gives real-time visibility and control over business spending. All purchases done from this card are auto-captured on the Happay platform. Employees can snap photos of receipts, record cash expenses and submit expense reports in minutes, on-the-go without bothering about collecting or forgetting to submit the bills on time.

Happay has exclusively tied up with Ratnakar Bank for these co-branded Happay Business Expense VISA Card. Happay’s Anshul Rai said, “The initial results from our pilot customers has been very encouraging and we’re pleased to now take this solution to the broader market. We hope to tap more SMEs as our solutions are far cheaper than the already present ERP solutions used by large corporates.”

Ritesh Pai, Senior Vice President and Head Direct Banking Channels, RBL Bank, said that the bank is looking at tapping its clients for Happay. “We expect to disburse about 15,000 cards by end of this year.”

Source : Thehindubusinessline
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Bank employees to get 15% increase in salary

Bank employees, mostly from the public sector, will get a 15 per cent wage hike and two additional holidays a month as part of an industry-wide wage settlement.

This is part of the deal cobbled up by employees’ unions and bank managements, under the aegis of the Indian Banks’ Association (IBA), at a meeting on Monday. Following the agreement, the employees’ unions have called off the four-day strike, which was supposed to start on February 25.

The proposed hike in salaries will amount to a collective outgo of ₹4,725 crore per year for the 45 banks that are part of the 10th industry-wide bipartite five-year wage (2012-2017) settlement exercise.

Almost 8.50 lakh employees in the banking sector – all public sector banks, some old generation private sector banks and a few foreign banks – are expected to benefit from the wage settlement. The revised salary will be implemented with retrospective effect from November 1, 2012.

Under the terms agreed on Monday, banks will remain closed on the second and fourth Saturday. Other Saturdays will be full working days. It is expected that even private banks may follow suit.

The proliferation of ATMs, internet banking and mobile banking in the last few years seems to have convinced bank managements, under the aegis of the Indian Banks’ Association (IBA), that giving second and fourth Saturdays off every month is feasible.

“Given the technology that is at play in banking, two Saturdays off in a month is unlikely to cause inconvenience to bank customers,” said a top public sector bank official.

According to CH Venkatachalam, General Secretary, All-India Bank Employees Association, the 15 per cent hike, which is excluding superannuation benefits, hospitalisation expenses, leave travel concession, is on the payslip component.

In the previous (9th) bipartite wage settlement, covering the 2007-2012 period, an average wage hike of around 17.5 per cent was given.

Announcing the conclusion of the 10th bipartite wage negotiations with bank unions and associations, TM Bhasin, IBA Chairman, said both sides (bank managements and unions) have agreed to work out detailed bipartite settlement note within a period of 90 days.

Source : Thehindubusinessline
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Bank of Maharashtra to sell bad loans worth Rs400-500 cr to ARCs

By the end of March Bank of Maharashtra will offload non-performing loans worth Rs.400-500 crore to asset reconstruction companies (ARCs), a top bank official has said.

“We are exploring this possibility (sale to ARCs) now that the norms have been modified to ensure a balanced environment for ARCs and banks”, RK Gupta, Executive Director, told BusinessLine.

The regulatory framework for securitisation companies had been recently modified to stipulate that ARCs will have to mandatorily invest and hold 15 per cent of the security receipt (SR) in place of a limit of 5 per cent earlier. This will have an immediate beneficial impact on cash-flows for banks, which will receive 15 per cent of the value of the sale.

So far this fiscal, Bank of Maharashtra has not offloaded any of its non-performing loans (NPLs) to ARCs.

Seeking improvement

Gupta said the bank is looking to improve the NPA situation and its planned sale of bad loans is part of the bank’s NPA management strategy.

As of end December 2014, the bank’s gross NPAs as a percentage of advances stood at 6.65 per cent. The net NPA level stood at 4.7 per cent.

Gupta said the bank is not looking to raise any capital in March, which is the only remaining month this fiscal. “We have a comfortable capital adequacy ratio at 11.7 per cent”, he added.

The bank had recently raised additional tier-1 capital of Rs.1,000 crore through seven-year perpetual bonds with a coupon of 9.48 per cent a year.

Source : Thehindubusinessline
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HSBC annual profits fall 17%; cuts return on equity target

HSBC Holdings Plc apologised and said it deeply regretted past conduct and compliance failures at its Swiss private bank as it reported a 17 per cent drop in annual profit on Monday.

Europe's biggest bank said recent disclosures about past practices and behaviour at its Swiss private bank - where it has been accused of helping clients dodge taxes - reminded it of "how much there still is to do" at the bank.

"We deeply regret and apologise for the conduct and compliance failures highlighted which were in contravention of our own policies as well as expectations of us," the bank said.

Cuts RoE target

HSBC said it was cutting its target for return on equity to "more than 10 per cent". The previous target was to exceed 12 per cent, and RoE fell to 7.3 per cent in 2014 from 9.2 per cent in 2013.

It reported a pretax profit of $18.7 billion for 2014, down from $22.6 billion the year before and below the average analyst forecast of $21 billion, after costs rose more than expected and its investment bank had a grim fourth quarter.

Underlying operating expenses were $37.9 billion in 2014, up 6.1 per cent from the year before, showing the struggle HSBC chief executive Stuart Gulliver was having to lower costs in the face of tougher regulation and the need for more compliance staff. That continues to depress returns.

HSBC's annual report also released on Monday showed Gulliver was paid 7.6 million pounds ($11.7 million) for 2014, down from 8 million pounds in 2013 but still likely to be one of the highest pay packets for a European bank executive.

Source : Thehindubusinessline
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SBI to open hi-tech digital branches in Hyderabad, Vizag

SBI has decided to open 2 hi-tech SBI Intouch branches, called digital stores, in Hyderabad and Visakhapatnam during the next financial year, according to C.R Sasikumar, the Chief General Manager, Hyderabad.

He was speaking to reporters here on Monday after opening a retail branch at Balayya Sastry Layout, the seventy-fifth, in the city. He said such digital branches had been opened in July 2014, in Mumbai, New Delhi, Bangalore, Chennai and Ahmedabad as part of SBI’s new initiatives to attract youngsters and tech-savvy people.

"As Hyderabad and Visakhapatnam are the two major cities in Telangana and Andhra Pradesh, we are setting them up in the two cities," he said.

He said the bank was trying for suitable places like malls to locate the branches. "The 24x7 branches will have executives to guide the customers in opening bank accounts, getting ATM cards, investing in various products and taking a printout of passbooks and other activities. They will also have video interface and wide array of machines at zones named Smart Table, Online Booth, Dream Zone, Expert Pod and Express Banking," he said.

He said the bank would also focus on opening more number of e-Corners – ATMs with banking facilities - in branches. "Twentythree e-Corners have already been opened in AP and Telangana branches. The number will cross 100 next year," he said.

He said the SBI which has 3,800 ATMs across both the States will also see a major change with the installation of 400 plus new ATMs with single machines for cash deposits and withdrawal instead of separate machines. The old machines will also be replaced in phases.

Sasikumar said the priority was now to increase mobile banking which is now being used by two per cent of the customers.

Source : Thehindubusinessline
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Syndicate Bank to issue 3.74 cr preference shares to Govt

Syndicate Bank has decided to issue 3.747 crore shares of Rs. 10 each on a preferential basis to the Government of India for capital infusion of about Rs. 460 crore.

The bank has fixed a minimum issue price of Rs. 122.75 per share in line with SEBI regulations for the proposed issue of the preferential shares. Based on this price, the number of shares to be issued to the Government of India works out to 3,74,74,541, the bank said in a note to the stock exchanges.

As a result, the Government of India's stake in the Manipal-headquartered bank will go up to 69.24 per cent from the current 67.39 per cent.

The Syndicate Bank scrip was trading 1.17 per cent lower at Rs. 118.65 in intra-day trade on the BSE on Monday.

The bank recently reported a 20 per cent drop in net profit for the December quarter on lower net interest income and higher tax expenses. Net profit for the December quarter stood at Rs. 304.99 crore as against Rs. 379.76 crore in the corresponding last quarter. The net interest income, the difference between the interest earned and expended for the December quarter, fell marginally to Rs. 1,317.68 crore against the corresponding last quarter's Rs. 1,358.53 crore.

Source : Thehindubusinessline
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