1 - IEPFA signed MOU with Bank of Baroda for Investor Awareness
Bank of Baroda (BoB) and Investor Education and Protection Fund Authority (IEPFA) signed a Memorandum of Understanding (MOU) to spread customer awareness and investor education.
BOB and IEPFA have decided to work towards creation of content (IEC material) and strategic use of all the available marketing channels and brand assets with the BoB viz. placement of IEPFA posters at all BoB branches, placement of digital banners of IEPFA in ATM, BoB Kiosks, Access Points, etc.
2 - Reserve Bank keeps repo rate unchanged at 5.15 %
The Reserve Bank of India (RBI) in its fifth bi-monthly Monetary Policy has kept the policy repo rate unchanged at 5.15%. It has also maintained the reverse repo rate at 4.90% and the marginal standing facility rate and Bank Rate at 5.40%.
The six-member Monetary Policy Committee (MPC) headed by Governor Shaktikanta Das revised the real GDP growth for 2019-20 downwards from 6.1% in the October policy to 5.0%. The decisions are in consonance with the objective of achieving the medium-term target for consumer price index inflation of 4% while supporting growth.
3 - RBI mulling to amend regulatory guidelines for UCBs
The Reserve Bank of India is mulling to amend regulatory guidelines for primary Urban Co-operative Banks - UCBs. The guidelines would primarily relate to exposure norms for single and group/interconnected borrowers, promotion of financial inclusion and priority sector lending.
These measures are expected to strengthen the resilience and sustainability of UCBs and protect the interest of depositors. RBI has also decided to bring UCBs with assets of 500 crore rupees and above under the Central Repository of Information on Large Credits - CRILC reporting framework. RBI will announce a comprehensive cyber-security framework for the UCBs.
4 - RBI Financial Stability Report released
RBI released December 2019 Financial Stability Report. The FSR reflects the collective assessment on risks to financial stability.
Gross NPA ratio may increase from 9.3% in September 2019 to 9.9% by September 2020.
Scheduled commercial banks’ (SCBs) credit growth remained subdued at 8.7% in September 2019.
Private Sector Banks (PVBs) registered credit growth of 16.5%.
SCBs’ capital adequacy ratio improved.
SCBs’ gross non-performing assets (GNPA) ratio remained unchanged at 9.3 per cent between March and September 2019.
5 - Customer Outreach Initiative: PSBs disburse Rs 4.91L Cr loans in Oct, Nov
Public Sector Banks have disbursed Rs 4,91,000 crore rupees of loans during the month of October and November 2019 under customer outreach initiative. The Customer Outreach Initiative by PSBs was launched in September to improve credit delivery and support the needs of the economy, with particular focus on MSMEs and Agriculture sector borrowers.
These banks disbursed 2.52 lakh crore rupees in October and 2.39 lakh crore rupees in November under this outreach initiative. Around 73,000 crore rupees were disbursed to MSMEs and over 78,000 crore rupees to the agriculture sector.
6 - Walmart launched credit card in partnership with HDFC Bank
Walmart India partnered with HDFC Bank Ltd. to launch a co-branded credit card exclusively for members of its Best Price Modern Wholesale “B2B Cash & Carry” stores. Registered members of Walmart India’s ‘Best Price’ can apply for co-branded credit card on Best Price stores.
The co-branded card will offer `Best Price’ members rewards and cashback on all purchases, with savings of up to 6% on annual spends. The card comes in two variants. Best Price Save Smart offers annual savings of up to Rs 14,250 and Best Price Save Max card offers annual savings of up to Rs 40,247.
7 - World Bank arm IFC invested $200 million in Mahindra Finance
International Finance Corporation (IFC), a unit of the World Bank Group, has anchored an investment round of $200 million in Mahindra & Mahindra Financial Services Limited (MMFSL) for supporting India’s NBFC sector in expanding financial services for MSMEs. IFC is investing $75 million from its own account and mobilizing another $125 million as parallel loans.
The investment is done with an aim to create a dedicated pool of financing for micro, small and medium enterprises (MSMEs) in low-income states. Mahindra Finance has earmarked at least $100 million for women-owned micro, small and medium enterprises.
8 - BlackBuck partnered with IDFC Bank, Yes Bank to offer free FASTags to truckers
BlackBuck, an online trucking platform, has entered into partnership with private lenders IDFC Bank and Yes Bank and will offer FASTags to truck owners free of cost. The truck owners can order FASTags on BlackBuck's Boss App, which is a digital service platform available especially for truck fleet owners, and get it delivered at their doorstep free of cost until December 31, 2019. FASTags will decrease tolling times and revolutionise the logistics sector in India.
The National Electronic Toll Collection (NETC) programme, is the flagship initiative of the Ministry of Road Transport and Highways.
9 - RBI released “Guidelines for ‘on tap’ licensing of SFB”
RBI released “Guidelines for ‘on tap’ licensing of Small Finance Banks (SFB) in the Private Sector” as follows −
The licensing window will be open on-tap.Minimum paid-up voting equity capital / net worth requirement shall be ₹ 200 crore.
SFBs will be given scheduled bank status immediately upon commencement of operations.
SFBs will have general permission to open banking outlets.
Payments Banks can apply for conversion into SFB after five years of operations.
10 - Government amended IEPFA Rules, 2016, to simplify refund of claims
The Investor Education & Protection Fund (Accounting, Audit, Transfer and Refund) Rules 2016 have been amended vide GSR No.571 (E) dated 14.8.2019 to simplify the process of refund of claims filed with The Investor Education & Protection Fund Authority (the Authority).
The amended rules inter-alia provide for digitisation with transparent and faceless processing of claims by the Authority. Compliances by companies have also been made time bound and system driven with rule based enforcement.
11 - NSE launched interest rate options on 10-yr govt bonds
National Stock Exchange launched interest rate options on ten-year Government bonds. The exchange recorded a turnover of 5,926 contracts on the first day of its launch. Interest rate options are based on the underlying ten-year government bonds, which are 7.26% 2029 bond and 6.45% 2029 bond.
The unit of trading is Rs 2 lakh face value of GOI securities, corresponding to 2,000 units. The options contracts available are European call & put options with minimum 8 in-the-money, 8 out-of-the-money and 1 near-the-money strike prices and a strike interval of Rs 0.25.
12 - Edelweiss AMC launched India’s 1st corporate bond ‘Bharat Bond ETF’
Edelweiss announced the public issue of India’s first Corporate Bond ETF called the Bharat Bond ETF. The Bharat Bond ETF will help to deepen the corporate bond markets and enhance retail participation.
The ETF will invest only in AAA rated bonds of Public Sector companies. Through the ETF, Edelweiss Mutual Fund proposes to raise an initial amount of 3000 crores. Bharat Bond ETF will be a low cost product for retail investors. BHARAT Bond ETF provides the best features of Mutual Funds, ETFs and Bonds.
13 - SBI inked $277 million pact with Germany based KfW bank
India and Germany inked pact of Rs 1,958 crore to develop energy-efficient housing programme. A loan agreement was signed between State Bank of India (SBI) and German development bank KfW for USD 277 million to establish an energy-efficient housing programme in India.
As per MoU, both builders and homebuyers shall be financed for developing/purchasing energy-efficient residential projects that achieve at least 25% energy savings in comparison to standard reference buildings. This programme, which will contribute to India's policy framework towards energy conservation, is a part of the Indo-German Development Co-operation, guided by the 2030 Agenda for Sustainable Development.
14 - HDFC Bank crossed $100 billion market capitalisation
HDFC Bank became the 3rd Indian firm to cross $100 billion mark in market capitalisation. The other two are Reliance Industries Ltd, which has a market cap of $140.74 billion, and Tata Consultancy Services (TCS) that has a market cap of $114.60 billion.
HDFC Bank is ranked at 26th position among the world’s most valued banks and financial companies which have a market cap of over $100 billion. HDFC bank has reported 20% profit growth, stable asset quality and healthy advances growth.
15 - Bank of Baroda partnered with Gujarat government to provide MSME loans
Bank of Baroda signed a MoU with the Government of Gujarat to facilitate flow of credit to the MSME sector for Greenfield Projects, Start-Ups, Women Entrepreneurs and Entrepreneurs from backward areas of Gujarat under Gujarat Single Window Clearance Act 2017 & Ordinance Number 1 of 2019 dated 24th October 2019.
“The objective of the Gujarat Single Window Clearance Act 2017 and Ordinance dated 24 October 2019 is to provide an entrepreneur-friendly environment in the State of Gujarat. This MoU would speed up the process of credit off-take as well as industrial development.
16 - SEBI signed pact with Kazakhstan’s AFSA for mutual co-operation
The Securities and Exchange Board of India (SEBI) and the Astana Financial Services Authority (AFSA) entered into a bilateral Memorandum of Understandingfor mutual co-operation and technical assistance.
The objective of the bilateral MoU was to strengthen cross border co-operation in the area of securities regulation. This will facilitate mutual assistance, contribute towards efficient performance of the supervisory functions, and enable effective enforcement of laws and regulations governing the securities markets.
17 - Finance Minister launched eBkray for online auction of assets attached by banks
Finance Minister launched eBkray, a common e-auction platform to enable online auction by banks of attached assets transparently and cleanly for improved realisation of value.
The platform is equipped with property search features and navigational links to all PSB e-auction sites, provides single-window access to information on properties up for e-auction as well as facility for comparison of similar properties, and also contains photographs and videos of uploaded properties. A total of 35,000 properties had been uploaded on the platform by PSBs.
18 - RBI directed large co-op banks to report exposures above Rs 5 cr
The Reserve Bank of India (RBI) directed large cooperative banks to report all exposures of 5 crore rupees and more to the Central Repository of Information on Large Credits (CRILC). The move is aimed at early detection of financial distress. Aggregate exposure will include all fund-based and non-fund based exposure (like partial credit enhancement) including investment exposure on the borrower.
The Reserve Bank has created a CRILC of commercial banks, all India financial institutions and certain non-banking financial companies with multiple objectives, which, among others, include strengthening offsite supervision and early recognition of financial distress.
19 - Government approved infuse Rs 8,655 crore into Allahabad Bank, IOB & UCO Bank
In order to strengthen banks, in addition to the recent infusion of Rs. 60,314 crore, additional infusion of Rs. 8,855 crore has been approved by Government of India for four banks, which would be released shortly. Rs 4360 crore to Indian Overseas Bank, Rs 2153 crore to Allahabad Bank, Rs 2142 crore to UCO Bank and Rs 200 crore to Andhra Bank have been approved. The infusion will be done for preferential allotment of shares.
The government had infused ₹60,314 crore in public-sector banks of the total of ₹70,000 crore that was announced for these banks in budget.
20 - RBI caps lending on P2P platforms at Rs 50 lakh
Reserve Bank of India capped the permissible exposure limit at Rs 50 lakh of a lender on a Peer-to-Peer lending (P2P) platform for all borrowers to protect the consumer’s interest.The lender investing more than Rs 10 lakh across P2P platforms has to produce a certificate from a Chartered Accountant.
Further, it is also proposed to do away with the current requirement of escrow accounts to be operated by bank promoted trustee for transfer of funds having to be necessarily opened with the concerned bank to provide more flexibility in operations.
21 - AIIB to give $210 million loan for irrigation & solar energy projects
The Asian Infrastructure Investment Bank’s (AIIB) Board of Directors has approved a USD145-million loan to India to improve irrigation service delivery and strengthen flood risk management in West Bengal and USD65-million 250-megawatt (MW) solar power project in Jodhpur.
West Bengal project, co-financed with the World Bank, is expected to strengthen the management of the Damodar Valley Command Area irrigation scheme to improve service delivery and efficiency. Jodhpur project will add 250 MW of solar capacity and result in clean energy generation of 616 MWh in 2022.