SBI launches ‘Project Tatkal’

The country’s largest lender State Bank of India today launched an initiative to provide doorstep services and expedite home loan application process.

The initiative known as ‘Project Tatkal’ will help get the loan within 10 days after receipt of application form and relevant supporting documents, the bank said in a release.

“It will bring down the average time taken for delivery of home loan to within 10 days from the date of receipt of completed home loan application form and relevant supporting documents from the customer,” the release said.

The implementation will be done at large centres with sizeable home loan business.

The bank has also recently introduced an online customer acquisition solution (OCAS) for instant e-approval of home loan applications.

It has over three million home loan customers with a portfolio of over Rs 16,60,000 crore.


Source : Thehindubusinessline

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DBS India posts Rs. 275 cr loss; awaits subsidiary licence

Singapore-based foreign lender DBS Bank posted a net loss of Rs. 275 crore in FY15 in its Indian business due to high provisioning towards bad loans to clean up of balance sheets. Last year, it made a net profit of Rs. 2 crore.

DBS India is also awaiting RBI’s approval to get licence to open wholly-owned subsidiary in India. At present, the Singapore-based lender operates under the branch-based model. “Over the next couple of months, we will get more clarity (on RBI approval),” said Surojit Shome, CEO, DBS India.

Shome, who joined the bank in April this year, saw net net non performing assets (NPAs) ratio improve to 4.15 per cent as on March end FY15 from 10.19 per cent in FY14.

In FY15, net NPA in absolute terms was at Rs. 658 crore as against Rs. 1544 crore a year ago. “This was achieved due to selling of problem loans, provisioning and write-offs,” Shome said.

Provisioning during the year increased substantially to Rs. 926 crore, up 79 per cent from Rs. 516 crore a year ago.

Gross NPAs during the year also reduced to Rs. 1,284 crore from Rs. 2,116 crore in FY14.

Meanwhile, the bank will continue to execute our two-pronged strategy – one is to grow our business, apart from the corporate, our SME and consumer business and reasonable foray on the digital front. “The second is to continue to clean up our balance sheets and leave behind the stress built up in the last three-odd years,” Shome said.

Total advances grew by 4.5 per cent to Rs. 15,845 crore. The bank also reduced its investment book by roughly about Rs. 4,500 crore.

In FY15, the NIMs (net interest margins) went up to 2.1 per cent from 1.9 per cent.

Net interest income grew marginally to Rs. 804 crore as against Rs. 790 crore in FY14. While other income declined about 11 per cent to Rs. 227 crore in FY15 from Rs. 255 crore a year ago.

During the year, the foreign lender also infused capital of Rs. 1,625 crore of Tier-II capital with the total capital at Rs. 4,811 crore at the end of the fiscal year. This helped improvement in capital adequacy ratio at 17.01 per cent from 13.8 per cent a year ago.

Growth in FY16

The DBS India chief said a lot of the growth is coming from new client acquisition, SME and consumer business. It will be cautious on the infrastructure and construction sector, which showed no growth in FY15.

“Hopefully, the slow and gradual pick up in the economy will help both our topline and growth and some of our troubled loan book…As we look at growth, we also have plans to infuse, if required, mostly Tier-II capital as we await the licence,” Shome said

He added, “If we get the approval from RBI on opening subsidiaries, we have to meet the priority sector lending targets and open branches in the rural and semi-urban areas.”

In India, DBS operates with 12 branches at present with an employee base of 1000.


Source : Thehindubusinessline

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HDFC Bank unveils banking application for Apple Watch

HDFC Bank, the country’s second largest private sector bank, unveiled its banking application for Apple Watch that allows its customers to view their account summaries, block cards and recharge their mobile phones and DTH connections.

The Apple Watch app will work when paired via Bluetooth with its mobile application on iPhone 5 and above versions. HDFC Bank said that it is developing a wearables application for the Android operating system by this year.

Customers will be allowed about 10 kinds of transactions including account information on savings, current, fixed deposits, demat accounts, mutual funds and credit cards, mobile and DTH recharge, request account statements and cheque books, locate the closest ATM and bank branch, view messages from the bank and discount offers and hotlist lost debit cards, said Nitin Chugh, Senior Executive Vice President and Head - Digital Banking, HDFC Bank.

The bank plans to allow payment of bills through active notifications, offers based on location and payment of pre-added bills soon.

Currently, HDFC Bank provides over 150 banking transactions through its net banking platform and about 80 transactions through mobile banking.

The private bank said that the Apple Watch application is merely a projection of the mobile banking app and works in conjunction with it. Customers will have to create a customised Watch banking PIN on the mobile app to access the account on the Apple Watch.

As a security feature, the user’s session logs out automatically after inactivity of about 5 minutes.

Rival ICICI Bank earlier in April announced its application for wearables. Called iWear, ICICI Bank’s wearables app is available for Android, Apple and Tizen devices.

The application is live on the Apple Store and can be downloaded by anyone who has an Apple Watch, which will be soon launched in India.


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Govt working on package for PSU banks saddled with bad loans: Sinha

The Finance Ministry is working on a comprehensive package to help state-run banks, which are saddled with huge bad loans, Minister of State for Finance Jayant Sinha said on Wednesday.

Rising bad loans at Indian banks over the past three years amid an economic slowdown has prevented banks from lending more, despite three interest rate cuts by the central bank this year totalling three-quarters of a percentage point.

This has affected the Government's plan to spur a revival in credit to key sectors such as infrastructure.

“We are working and trying to understand exactly what the capital requirements are going to be in the next 2-3 years for (public sector) banks. And we are there to support them and provide them the capital that they need,” Minister of State for Finance Jayant Sinha said at an event organised by IVCA here.

A high-level panel comprising Sinha and Financial Services Secretary Hasmukh Adhia are assessing the capital requirement. The last meeting of the panel will be held on July 3 in Bengaluru.

Last year, Finance Minister Arun Jaitley had said to be in step with Basel-III norms, there is a requirement to infuse Rs. 2.40 lakh crore as equity in public sector banks by 2018.

For the current fiscal, the Government has allocated Rs. 7,940 crore in the Budget for capital infusion in state-owned banks.

However, the Finance Minister last month promised to provide more than the budgeted amount this fiscal.

“As far as public sector banks are concerned, we put in place a comprehensive package to really strengthen our banks. There are five aspects and dimensions we are trying to do,” Sinha said.

First and foremost, Sinha said, the Government is working on governance changes relating to role of MDs, the board and the like.

He said, “We have been working on strengthening management of banks by making the selection process transparent. We have also been working on improving the operating performance of these banks as well as in terms of technology and risk management.”

The Finance Ministry will soon wrap up the exercise.

The upcoming meeting in Bengaluru will take stock for banks such as Andhra Bank, Indian Overseas Bank, Corporation Bank, Canara Bank, Syndicate Bank and Vijaya Bank.

The Ministry is already done with the assessment for other public sector banks.


Source : Thehindubusinessline

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Kotak Mahindra Bank cuts base rate by 10 bps to 9.75%

Following most big banks, private sector lender Kotak Mahindra Bank reduced its base rate by 10 basis points (bps) to 9.75% p.a from 9.85% earlier.

The revised rate will be effective from July 2, 2015.

Base rate is the minimum lending rate below which banks do not lend to borrowers. One basis point is 0.01 percentage point.

“All categories of loans (other than the exceptions permitted by RBI) will be priced with reference to the revised Base Rate,” the bank said in a statement.

Following the RBI cut in June, most banks including State Bank of India, ICICI Bank, HDFC Bank and Axis Bank among others have also slashed their minimum lending rate.


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Mobile banking: SBI eyeing top spot in value terms

In the ongoing competition to retain existing customers as well as attract new ones with digital banking services, the country’s largest bank, State Bank of India, hopes to pip HDFC Bank to become the largest mobile banking player in value terms. At present, even as SBI has the highest volume of transactions on the mobile banking platform, in value terms, SBI remains at the third position but aims to reach the top.

“This will happen before the end of this year. What has happened is that our corporate internet banking was not available on mobile. For that you will see the launch very soon. And as soon as this corporate internet banking comes on mobile we will catch up with the numbers,” said Arundhati Bhattacharya, Chairperson, SBI. RBI data show that in April 2015, HDFC Bank recorded transactions worth Rs.5,686.5 crore, while SBI’s transaction value stood at Rs.1,701 crore; the total value of transactions on the mobile banking platform in the sector stood at Rs.18,869 crore.

“The reason is (that) we are only getting the retail segment onto the mobile. The moment corporate internet banking starts happening on mobile, these numbers are definitely going to go up exponentially. We have a plan as to how we need to take a leadership there… We hope to achieve this in the next 12 months,” she said.

After tying up with big e-commerce players such as Amazon, Snapdeal, PayPal, MakeMyTrip and others, SBI will also shortly open a separate digital vertical to spur its business through the online medium.

“Lending has definitely become more secure online and…it is comforting,” she added.


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Court approves IDFC, IDFC Bank demerger

IDFC has informed the stock exchange that the Madras High Court has approved the Scheme of Arrangement (demerger) between IDFC and IDFC Bank.

Earlier, the RBI had given its clearance to the scheme of arrangement proposed by the company.

IDFC was one of the two applicants (the other being Bandhan Financial Services Pvt Ltd) that received in-principle approval last year to establish banks.

The board of directors of IDFC, on October 30, 2014, gave its approval to demerge its financing undertaking into its wholly-owned subsidiary IDFC Bank (transferee company) as part of the scheme of arrangement under the Companies Act, 1956.

After the scheme became effective and after securing all relevant approvals, the shares of IDFC Bank would be listed on the BSE and the NSE, the board said. The board of IDFC Bank, which was incorporated by IDFC with paid-up capital of Rs 5 lakh, also approved the scheme.


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SBI partners with MakeMyTrip for travel biz

In its series of digital initiatives and tie-ups, State Bank of India, country’s largest bank, partnered with online travel company MakeMyTrip.com to capitalise on the business opportunities of the booming e-commerce and m-commerce ecosystem.

The alliance includes partnership with personal banking unit for consumer facing propositions – including EMIs on purchase of holidays & international travel, customized travel products like Forex cards and travel products that inspire SBI customers to travel.

It also includes partnership with SME & Acquiring Business -- MMT suppliers, such as 2-3 star hotels, franchisees, Trade & Travel partners will get access to SBI products, loans, bank guarantees, PoS payment instruments at preferential rates and partnership with cards for promoting card usage which will help in pushing the agenda of a less cash economy.

Arundhati Bhattacharya, Chairman, SBI said, “Travel forms an integral part of a customer’s lifecycle and comprises almost 65% of the total e-Commerce market today. Our alliance with MakeMyTrip will work towards providing value to each of the stakeholder along the entire value chain of travel and tourism business, starting from hotels, travel agents, tour operators besides the end-consumers and our customer-base.

“SBI aims at becoming a “One Stop” solution provider for the entire range of financial needs of e-Commerce players as well as our customers in the market.”

Deep Kalra, Chairman & Group CEO – MakeMyTrip, elaborated, “MakeMyTrip constitutes about 46% of the bookings in the online space and a lot of product work is being done in the $22-23 billion travel industry ecosystem…”

With increasing disposable household incomes, consumers are undertaking more frequent travels and vacations. In addition, with growth in e-commerce and smartphones, the online travel segment is expected to grow at a much faster rate.

According to PhocusWright, India is forecasted to have 1 billion online users by 2030. This growth, led by one of the youngest global populations who love their smartphones, is expected to add 300 million new online shoppers in the same time frame. At the same time, India’s travel market is forecasted to grow to $27.5 bn by 2016 (at a CAGR of 12% from 2014-2016), with growth of online markets at 1.5x the total market. PhocusWright also estimates MakeMyTrip’s market-share at 47%. Domestic travellers are expected to contribute around 84.7% of total tourism revenue by 2024 according to a report by Corporate Catalyst (India), SBI said in a statement.

MakeMyTrip customers will be able to access special offers from SBI on debit/credit cards and personal financing.


Source : Thehindubusinessline

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Citibank lowers base rate by 15 basis points to 9.35%

After domestic banks, foreign lender Citibank reduced its base rate by 15 basis points to 9.35% with effect from 1 July, the bank said.

One basis point is 0.01 percentage point.

The cut was driven by falling interest rates reflected in lower deposit costs, the bank statement said.

Citibank is the first large foreign bank to announce a base rate cut after the Reserve Bank of India (RBI) reduced its key policy rate or the repo rate by 25 basis points to 7.25% on June 2.

Following the RBI cut, domestic banks including State Bank of India, ICICI Bank, HDFC Bank and Axis Bank among others have also slashed their minimum lending rate.


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Lakshmi Vilas Bank cuts base rate to 10.95%

Following all major banks, old private sector lender Lakshmi Vilas Bank reduced its base rate by 15 basis points (bps) to 10.95% p.a. from the earlier rate of 11.10% p.a.

The revised rates will be effective from July, 01, 2015.

“This move comes after the Reserve Bank of India (RBI) cut the key policy rate or the repo rate by 25 basis points earlier this month. Base rate is the benchmark rate to which all lending rates are linked. The said reduction is applicable to the existing as well as future loans,” the Bank said in a statement.

Rakesh Sharma, MD & CEO, Lakshmi Vilas Bank said, “As the economy is gaining momentum, the present reduction in Base Rate would further energies the investment sentiments and support long term growth. This will enable retail, MSME and export customers among others to avail funds at reduced rates and to stay competitive in their respective sectors.”


Source : Thehindubusinessline

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ING Vysya, Kotak Bank merger to be completed in 6-9 months

The integration of ING Vysya Bank with Kotak Mahindra Bank will be completed in the next six to nine months, according to Sumit Bali, Senior Executive Vice-President, Kotak Mahindra Bank.

He was speaking to newspersons at a press conference to announce the launch of a special debit card with the theme of Amish's latest book Scion of Ikshavaku here on Tuesday.

Following acquisition by Kotak Mahindra Bank, ING Vysya Bank got merged with the former from April 1, 2015.

"The first quarter results of FY 2016 will have the numbers for the combined entity,'' he said.


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Axis Bank to launch differential interest rate on FDs

Axis Bank, India’s third largest private sector bank, becomes the first private bank to launch differential interest rate on fixed deposits, to give customers a higher rate of return on their fixed deposit investment as compared to regular fixed deposit rates.

“The scheme ‘Fixed Deposit Plus’ is targeted at both Retail customers (Domestic & NRI) and corporate customers who seek safe avenues to invest surplus money at higher rates. The customers need to invest a minimum amount of Rs. 15 lakh at a single instance to enjoy a 10 bps higher rate of interest on their investment,” Axis Bank said in a statement.

The differential rates on Fixed Deposit Plus with a lock in are currently available for a minimum period of 1 year and a maximum period of less than 2 years. No premature withdrawal will be allowed prior to maturity date, it said.

In April this year, RBI had allowed banks to offer differential interest rates, based on whether their term deposits are with or without a premature withdrawal facility.

Rajiv Anand, Group Executive and Head Retail Banking said, “With the increasing number of customers seeking safer investment options, we are confident that the new ‘Fixed Deposit Plus’ scheme will offer higher earning potential, while continuing to promise guaranteed returns.

Fixed Deposit Plus is the first product launched by any private bank in the country after the recent RBI announcement that allow banks the discretion to offer differential interest rates based on whether the term deposits are with or without-premature-withdrawal-facility, Axis bank statement said.


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