Wednesday, June 16

Finance

ICICI Bank expects corporate demand to pick up as economy rebounds

ICICI Bank expects corporate demand to pick up as economy rebounds

Finance
which has been cautious on bulky corporate lending is getting back to increasing exposure to companies as it believes that company balance sheets will also grow as India's economy recovers from the disruption caused by the Covid 19 pandemic. Executive director Vishakha Mulye said the bank expects corporate demand also to pick up in the next economic cycle. "For India to grow faster post the pandemic both investment as well as consumption demand will have to fire. We 100% believe that corporate demand will pick up," Mulye said without elaborating how much she expects the growth to pick up. The bank has doubled the number of current accounts in the last year, Mulye said. She did not give the number of current accounts the bank currently services. Corporate loans constitute 45% of the bank...
Indian Overseas Bank urges RBI to pull the bank out of PCA framework

Indian Overseas Bank urges RBI to pull the bank out of PCA framework

Finance
State-owned Indian Overseas Bank has urged the Reserve Bank of India to lift business curbs from it placed under the prompt corrective action framework with the lender's annual return on assets turning positive for the first time since 2014. The bank reported Rs 831 crore of annual profit against Rs 8,527 crore loss in the preceding fiscal. ROA for the full year was 0.31% as against a negative 2.95% a year back. Net profit for the March quarter more than doubled at Rs 350 crore against Rs 144 crore in the year ago period, largely owing to gains from treasury operations. "We are very comfortable in respect of all parameters and have approached the regulator for lifting of PCA restrictions," 's managing director Partha Pratim Sengupta said. The fall in deposit cost also helped profitabilit...
New auditors: RBI clarifies on tenure, eligibility norms

New auditors: RBI clarifies on tenure, eligibility norms

Finance
Amidst both support to as well as calls for a review of its new norms for appointing auditors by financial institutions, the Reserve Bank has stuck to its stance but has clarified certain doubts in the industry on the tenure and eligibility criteria among others. The central bank on April 27, 2021, had issued a circular on 'Guidelines for appointment of statutory central auditors (SCAs)/statutory auditors (SAs) of commercial banks (excluding RRBs), UCBs and NBFCs (including HFCs)'. While the circular has been lapped by domestic audit firms, including their apex regulatory body ICAI, industry lobbies have called for a review saying it will increase cost and also doubting the ability of domestic audit firms to handle large accounts. Significantly, the big four--KPMG, Deloitte, EY and PwC w...
IDFC FIRST Bank offers four times annual CTC, salary continuation for two years to corona affected employees’ families: MD

IDFC FIRST Bank offers four times annual CTC, salary continuation for two years to corona affected employees’ families: MD

Finance
Private sector is offering compensation equivalent to four times of the CTC as well as continuation of salary for two years to the families of the employees who lost their lives due to the coronavirus infection. Among others, the bank is also offering loan waivers of such employees so that their families do not feel pressured due to the economic burden. "The bank's employees are usually young people. Their families will be taken by shock. So we put together a composite programme covering all angles. We are giving four times the annual CTC as compensation plus continuing the salary for two more years so that the family can get the time to economically recover," V Vaidyanathan, Managing Director and CEO, IDFC FIRST Bank, told PTI. The bank is taking initiative to contact the families of t...
Bank of Maharashtra tops PSU banks in terms of loan, deposit growth

Bank of Maharashtra tops PSU banks in terms of loan, deposit growth

Finance
State-owned Bank of Maharashtra (BoM) has emerged as the top performer among public sector lenders in terms of loan and deposit growth during financial year 2020-21. The lender recorded 13.45 per cent increase in gross advances at Rs 1.07 lakh crore in 2020-21, as per the published data of BoM. It was followed by Punjab & Sind Bank which posted 8.39 per cent growth in advances with aggregate loans at Rs 67,811 crore at the end of March 2021. When it came to deposit mobilisation, BoM with nearly 16 per cent growth was ahead of even the country's largest lender State Bank of India, which recorded 13.56 per cent rise. However, in absolute terms SBI's deposit base was 21 times higher at Rs 36.81 lakh crore as against Rs 1.74 lakh crore of BoM. Current Account Savings Account (CASA) ...
RBI extends risk-based internal audit system to HFCs

RBI extends risk-based internal audit system to HFCs

Finance
The Reserve Bank on Friday extended the risk-based internal audit (RBIA) system to select housing finance companies to enhance the quality and effectiveness of their internal audit system. In February this year, the RBI had issued a circular mandating the RBIA framework for select non-banking financial companies (NBFCs) and urban co-operative banks by March 31, 2022. On Friday, the RBI, through a circular, extended the provisions issued for NBFCs to housing finance companies (HFCs) also. The provisions will apply to all deposit-taking HFCs, irrespective of their size, as well as non-deposit-taking HFCs with asset size of Rs 5,000 crore and above, the central bank said. Such HFCs have been asked to put in place an RBIA framework by June 30, 2022. An effective RBIA is an audit methodol...
IDBI customers to get only 20 free cheque leaves per year from Jul 1; other services too revised

IDBI customers to get only 20 free cheque leaves per year from Jul 1; other services too revised

Finance
customers will have to pay Rs 5 per cheque leaf beyond 20 free leaves per year, under the revised charges from next month. Currently, customers can access as many as 60 cheque leaves without any charges in a year in the first year of account opening and 50 leaves in all the subsequent years. Beyond these, one has to pay Rs 5 per leaf. Introducing the revision of services in savings bank accounts, the lender in a notice said the free transaction limits (for select facilities) and lock discounts offered to individual savings bank customers are being revised from July 1, 2021. Customers holding the 'Sabka Saving Account' will not come under this and will be able to get unlimited free cheque leaves in a year. This is an elementary zero balance account aimed to further inclusive banking in ...
Retail loan demand moving to smaller cities from young borrowers: Report

Retail loan demand moving to smaller cities from young borrowers: Report

Finance
COVID-19 has impacted borrower behaviour pattern with a majority of borrowing shifting out of tier-I cities, demanding smaller ticket loans and millenials accounting for a bulk of retail loan demand according to a joint report by credit bureau Transunion Cibil and Google. The report also underscores the increasing use of technology platforms to borrow in recent times. An analysis of consumer loan patterns by the credit bureau showed that 49% of new-to-credit retail borrowers are less than 30 years old. Significantly, small ticket lending in increasingly moving out of larger metros with 70% of disbursals from smaller cities and towns. Besides, the preference is for small sizes loans of upto Rs 25,000. Amongst all personal loans has gone up from 10% in 2017 to 60% in 2020, the report noted....
Credit score access trailing personal loan growth by wide margin, report

Credit score access trailing personal loan growth by wide margin, report

Finance
Growth in credit score access by individuals is trailing the jump in personal loans over the last few years by a wide margin, despite regulatory moves to provide credit information report free every year, India's largest credit information company (CIC) said on Thursday. As against a 23-times growth in personal loans under Rs 25,000 in 2020, as against 2017, the number of consumers checking their credit scores has grown only three times in 2020 when compared to 2018, Transunion Cibil said in a report. In September 2016, the Reserve Bank of India had announced that starting 2017, all the CICs should give individuals a free access to the credit scores/report at least once every year by requesting for it, given the importance of the credit report in an individual's financial matters. In th...