THE WEEKLY FINANCIAL NEWS
Draft Company rules mandate rationale for high salaries, hikes
The
government has proposed to limit the number of investors in private placement
schemes to 200 persons with a minimum investment size of Rs 50,000 each in a
financial year, the rules suggest that it should be made mandatory for listed
companies to give their rationale behind salaries and hikes given to top
management personnel vis-a-vis the performance of the company.
Costlier
lending likely, say banks
Banks
could raise their lending rates following RBI's monetary policy announcement on
Friday as tight liquidity could increase cost of funds.
Bankers
welcome Raghuram Rajan-led RBI's repo rate hike
Bankers
welcomed the Reserve Bank of India (RBI) Governor Raghuram Rajan's mid-quarter
monetary policy announcements and termed them as "a balanced and a
pragmatic move" which will reduce banks' borrowing costs.
Raghuram
Rajan tracking Indian rupee 'minute-by-minute', says it's not stable yet
After
hitting a lifetime low of 68.85 against the dollar on August 28, the rupee has
recovered aggressively to become the best performing Asian unit in the last
fortnight.
Deadlock
over RBI's 80:20 gold import norm ends
The
problem was that of interpretation of 80:20. This means that at least 20 per
cent you have to give for exports. So, somewhere it was misinterpreted that you
cannot export more than 20 per cent. One can export more than 20% of imports.
RBI repo
rate hike pours cold water on auto makers' festive season hopes
"The
industry had been hoping for a recovery through the ensuing festive season,
anticipating an improvement in markets. But this move comes as a surprise
dampener to all these expectations," Society of India Automobile
Manufacturers (SIAM) said in a statement. Market analysts, however, said the repo
rate hike should not have much impact on the auto sector.
Raghuram
Rajan wants 'bullet-proof' shield for India against US Fed
"What
we need to do is put our house in order before it (tapering) comes back. The
postponement of tapering is only that, a postponement. We must use this time to
create a bullet-proof national balance sheet and growth agenda, which creates
confidence in citizens and investors alike," RBI Governor, Raghuram Rajan
said.
RBI repo rate hike: Indian realty developers unhappy with Raghuram Rajan,
say will impact housing
Expressing
disappointment over RBI Governor Raghuram Rajan's decision to hike the key
policy rate, real estate developers said this would lead to increase in finance
cost and also affect housing demand during the festive season.
RBI
or SEBI should create awareness against ponzi schemes: SBI
Recently,
the West Bengal based Saradha Group has been accused of duping investors of
their savings running into thousands of crores of rupees.
Fed makes
room for RBI
The
more immediate impact of the Fed’s decision not to taper, however, is to give
RBI more room to ease policy rates.
SBI
increases base rate to 9.80 pct, makes loans costlier
The
country's largest lender, State Bank of India, said it increased its base rate,
or the minimum rate of lending, to 9.80 per cent, a day ahead of the RBI's
policy review. SBI increased spreads on auto and home loans by as much as 0.20
pct. All top private sector lenders, including ICICI Bank, HDFC Bank and Axis Bank,
had hiked rates to protect net interest margins.
Outlook:
Indian rupee likely seen higher to US dollar, RBI monetary policy review meet
key
The
US Federal Reserve's decision to press ahead with its asset-buying gives
India's battered rupee a reprieve and creates space at a policy review on
Friday for its Reserve bank of India (RBI) to scale back some of the measures
put in place to support the currency.
Indian
rupee could appreciate to 59 against US dollar: Fitch
The
basis of Ind-Ra's (India Ratings & Research, a Fitch group company)
expectation of INR appreciation is based on economic developments in the last
one to two months of this fiscal and the likely developments in the remaining
months.
FIPB
clears Axis Bank's proposal to raise FDI limit beyond 49 pct
The
FIPB (Foreign Investment Promotion Board) approved raising the foreign equity
holding in Axis Bank to 62 per cent from 49 per cent, subject to the condition
that the holding of foreign institutional investors does not exceed 49 per
cent.
Indian
rupee gains 142 paise to 61.96 against dollar on Fed's surprise decision
RBI
acts tough on offshore forex trading on Internet
In a
circular issued late on Tuesday, the Reserve Bank of India (RBI) asked banks to
advise customers not to undertake forex trading on foreign websites that offer
currency contracts by accepting margins through credit card and online money
transfer mechanisms. The RBI also asked banks to close the credit card or
online bank account of a customer that is found to be in violation of the rule.
RBI asks
banks to allot different product code to dormant accounts
Because State and central governments have expressed
difficulties in crediting cheques/Direct Benefit Transfer/Electronic Benefit
Transfer/scholarships for students, Zero Balance Accounts, into accounts opened
for the beneficiaries under various central/state government schemes but had
been classified as dormant/inoperative due to non-operation of the account for
over two years.
RBI
tightens norms for lending against gold jewellery
In
order to standardise the valuation and make it more transparent to the borrower,
it has been decided that gold jewellery accepted as collateral will have to be
valued at the average of the closing price of 22 carat gold for the preceding
30 days as quoted by the Bombay Bullion Association (BBA).
Foreign
banks to provide upfront loans to wealthy NRIs for Indian dollar deposits
Foreign
banks will provide upfront financing for wealthy non-resident Indian clients to
entice them to place bulky dollar deposits back home in response to India's
drive for dollar funding to defend its weak currency.
State
Bank of Patiala opens all women in Chandigarh
Achal
Kumar Gupta, Managing Director, State Bank of Patiala said that this is the
third all women branch of State Bank of Patiala after Bathinda and Patiala.
Foreigners allowed to carry up to Rs10K beyond immigration desk
RBI
today permitted foreigners to carry up to Rs 10,000 beyond immigration desk to
the duty free area in airports for miscellaneous expenditures, but they will
have to dispose the Indian currency before boarding plane.
Credit
Suisse sees Indian rupee at 57-58 levels to US dollar
Rupee may see a sharp
appreciation on the back of measures taken by RBI and government as the decline
was largely driven by “fear trade”, analysts at Credit Suisse said.
TAPER, KIMONO, CATS……THE WORDS THAT
MEAN BUSINESS
Click on the picture below and find what you need to
know
EXPERT VIEW
Balanced and pragmaticGiven all the domestic and global cross-currents at play, RBI has done the best it could.
By Sajjid Chinoy, chief India economist, JP Morgan.
A SNEAK PEAK INTO THE WORLD OF FINANCE
To know why government takes
to ‘cattle class’ again, click on the slideshow below
TERM OF THE WEEK
Shadow Banking· The term ’shadow banking system‘ was first used in 2007, and gained popularity during and after the 2008 financial crisis, as it highlighted the bank-like functions performed by entities outside the regular banking system.
· The more comprehensive definition, as adopted by the Financial Stability Board (FSB), i.e., ‘credit intermediation involving entities and activities (fully or partially) outside the regular banking system’ has been globally accepted.
· This definition has two important components:
o First, non-bank financial entities or entities outside the banking system that engage in the ‘bank like’ activities of maturity transformation, undertaking credit risk transfer and using direct or indirect financial leverage.
o Second,
activities such as securitization, securities lending and repo transactions
that act as important sources of funding for non-bank entities.
·
Thus, shadow banks comprise entities which
conduct financial intermediation directly, such as finance companies or NBFCs,
and entities which provide finance to such entities, such as mutual funds. · Globally, shadow banking entities could be covered under the broad heads of (i) Money Market Funds, (ii) Credit investment Funds, Hedge Funds, etc. (iii) Finance Companies accepting deposits or deposit like funding, (iv) Securities brokers dependent on wholesale funding, (v) Credit insurers, financial guarantee providers and (vi) Securitisation vehicles.
0 comments:
Post a Comment