The government wants the <a href="https://www.wionews.com/india.../government-making-efforts-to-ensure- better-regulatory-mechanism-in-banking-sector-nirmala-sitharaman-...">Reserve Bank of India</a> to set up a fund to buy out stressed assets of the country's top 25 shadow lenders and revive the financial sector, a government source told reporters on Thursday.

The shadow banking sector has been battling a credit crunch ever since one of the sector's biggest firms Infrastructure Leasing &amp; Financial Services collapsed in late 2018 amid fraud allegations.

The finance ministry has proposed a bailout plan on the lines of the US&nbsp;Troubled Asset Relief Programme following the 2008 financial crisis to pull India's financial sector out of a deep slump and get credit flowing back into a weak economy, the source told a group of reporters.

"Talks are on and various rounds of discussions have happened with the central bank on a mini TARP-like programme," the source who is involved in the discussions told reporters.

"RBI could be the buyer of last resort”," the source, who cannot be named in line with his service rules, said.

In 2008, the United States Treasury Department had worked out a $700 billion bailout plan to address the financial crisis.

The government has been considering measures to revive the financial sector to get boost economic growth after five straight quarters of declines. A further decline in the growth rate is forecast for the July-September period, in data due out on Friday.

Shadow lenders account for a large chunk of India's credit market, accounting for a 30 per cent&nbsp;share of auto loans and more than 40 per cent of home loans as of December 2018, according to the central bank.

The government official said that the RBI has been reluctant to open its balance sheet for a large bailout programme for the shadow banks as it feels the step is too drastic and more discussions are required.

The RBI declined to comment on the government source's remarks.

Any new measure is likely to help such as Indiabulls Housing Finance, Piramal Enterprises, Reliance Capital, Shriram Transport Finance and Mahindra &amp; Mahindra Financial Services.

Shares of Piramal rose nearly 5 per cent&nbsp;to 1830.70 rupees a share, while Shriram Transport Finance company rose 1.3 per cent&nbsp;to 1,155 apiece from 1,140 rupees, after the news before paring some gains.

The new proposal comes after the government's 1 trillion rupees partial credit guarantee scheme under which state-run banks would buy high-rated pooled assets of financially sound shadow lenders failed to take off.

Banks, which are burdened with over 9 trillion rupees of bad loans of their own, remain risk-averse.

The government has also asked the central bank to consider a one-time waiver to banks from classifying some real estate loans as bad loans, the official said.

The government wants the Reserve Bank of India to set up a fund to buy out stressed assets of the country's top 25 shadow lenders and revive the financial sector, a government source told reporters on Thursday.

The government wants the Reserve Bank of India to set up a fund to buy out stressed assets of the country's top 25 shadow lenders and revive the financial sector, a government source told reporters on Thursday. The shadow banking sector has been battling a credit crunch ever since one of the sector's biggest firms Infrastructure Leasing & Financial Services collapsed in late 2018 amid fraud allegations. The finance ministry has proposed a bailout plan on the lines of the US Troubled Asset Relief Programme following the 2008 financial crisis to pull India's financial sector out of a deep slump and get credit flowing back into a weak economy, the source told a group of reporters. "Talks are on and various rounds of discussions have happened with the central bank on a mini TARP-like programme," the source who is involved in the discussions told reporters. "RBI could be the buyer of last resort”," the source, who cannot be named in line with his service rules, said. In 2008, the United States Treasury Department had worked out a $700 billion bailout plan to address the financial crisis. The government has been considering measures to revive the financial sector to get boost economic growth after five straight quarters of declines. A further decline in the growth rate is forecast for the July-September period, in data due out on Friday. Shadow lenders account for a large chunk of India's credit market, accounting for a 30 per cent share of auto loans and more than 40 per cent of home loans as of December 2018, according to the central bank. The government official said that the RBI has been reluctant to open its balance sheet for a large bailout programme for the shadow banks as it feels the step is too drastic and more discussions are required. The RBI declined to comment on the government source's remarks. Any new measure is likely to help such as Indiabulls Housing Finance, Piramal Enterprises, Reliance Capital, Shriram Transport Finance and Mahindra & Mahindra Financial Services. Shares of Piramal rose nearly 5 per cent to 1830.70 rupees a share, while Shriram Transport Finance company rose 1.3 per cent to 1,155 apiece from 1,140 rupees, after the news before paring some gains. The new proposal comes after the government's 1 trillion rupees partial credit guarantee scheme under which state-run banks would buy high-rated pooled assets of financially sound shadow lenders failed to take off. Banks, which are burdened with over 9 trillion rupees of bad loans of their own, remain risk-averse. The government has also asked the central bank to consider a one-time waiver to banks from classifying some real estate loans as bad loans, the official said.

Government wants RBI to buy out stressed assets of shadow banks: Report

Will Kill Myself If Extradited says Nirav. Nirav is an accused in India's biggest banking fraud.

WION Dispatch: Mandy Clark on Nirav Modi Extradition

Will Nirav be extradited to India?

China will remove business restrictions on foreign banks, brokerages and fund management firms, a cabinet meeting chaired by Premier Li Keqiang said on Wednesday, state television reported.

But the move, which comes nearly 18 years after China joined the World Trade Organisation (WTO), could have a limited impact on the competitive landscape of an industry dominated by China's state firms.

China has stepped up efforts to open its financial sector amid a festering <a href="https://www.wionews.com/world/united-states-china-trade-mini-deal-being-papered-trump-256340">trade war </a>with the United States, with increased access to its financial sector among a host of demands from Washington.

Last week, China announced a firm timetable for opening its futures, brokerage and mutual fund sectors fully to foreign investors next year, as Beijing and Washington reached a tentative deal to resolve their trade dispute.

The cabinet did not elaborate on what effect the removal of the curbs would have. On Tuesday, the cabinet relaxed management rules for foreign insurers and banks, giving them easier access to China, and wider business scope.

China will also support local governments' efforts to attract more foreign investment and allow foreign companies to be more flexible in choosing how they borrow funds from abroad, the cabinet said.

China will not allow forced technology transfers by foreign firms, it said.

Stabilising foreign investment is part of Beijing's policies to support the<a href="https://www.wionews.com/business-economy/global-markets-asia-relieved-at-latest-trade-truce-china-data-disappoints-255740"> slowing economy </a>that has been hit by the country's trade war with the United States.

In 2007, HSBC Holdings, Standard Chartered Bank, Bank of East Asia&nbsp;and Citigroup&nbsp;became the first foreign banks allowed to set up locally-incorporated subsidiaries in China as Beijing gradually opened up the sector.

But hampered by numerous restrictions on business scopes and operations such as outlet openings, the roughly 40 foreign banks with local units operating in China account for a tiny fraction of a market dominated by state-owned rivals such as Industrial and Commercial Bank of China&nbsp;and Bank of China.

"Many people say 'the wolves are coming', but my observation is that...through opening, Chinese regulators intend to introduce technology and talents, but it doesn't mean foreign players can grab a big market share in China," Xin He, Societe Generale's&nbsp;China head of global markets told a financial conference over the weekend.

He added that the French bank has retreated from its retail business in China after realising that "foreign banks cannot compete with Chinese players in this business segment."

In the securities sector, China last year relaxed rules to allow foreign brokerages to own a majority stake in Chinese ventures. China said last week foreign ownership limits in the sector will be scrapped completely on Dec. 1, 2020. UBS Group, JPMorgan Chase&nbsp;and Japan's Nomura Holdings&nbsp;have obtained regulatory approval to set up majority-owned China ventures.

But China has yet to open more sensitive areas of its financial industry. US&nbsp;payments card giants Mastercard Inc&nbsp;and Visa Inc&nbsp;are still awaiting regulatory approval to conduct yuan clearing business in the country.

China's economic growth is expected to slow to a near 30-year low of 6.2 per cent&nbsp;this year and cool further to 5.9 per cent&nbsp;in 2020, a Reuters poll showed, even as Beijing steps up policy stimulus.

The government has been leaning heavily on fiscal stimulus to support the economy, including rolling out big tax cuts and increased spending on infrastructure investment.

Tax and fee cuts amounted to 1.5 trillion yuan&nbsp;in the first eight months, which has helped ease the burden on firms, boost incomes and employment, with full-year reductions set to exceed 2 trillion yuan, the cabinet said.

The government will also support local governments facing fiscal difficulties to ensure wage payments, the cabinet said.

China will remove business restrictions on foreign banks, brokerages and fund management firms, a cabinet meeting chaired by Premier Li Keqiang said on Wednesday, state television reported.

China will remove business restrictions on foreign banks, brokerages and fund management firms, a cabinet meeting chaired by Premier Li Keqiang said on Wednesday, state television reported. But the move, which comes nearly 18 years after China joined the World Trade Organisation (WTO), could have a limited impact on the competitive landscape of an industry dominated by China's state firms. China has stepped up efforts to open its financial sector amid a festering trade war with the United States, with increased access to its financial sector among a host of demands from Washington. Last week, China announced a firm timetable for opening its futures, brokerage and mutual fund sectors fully to foreign investors next year, as Beijing and Washington reached a tentative deal to resolve their trade dispute. The cabinet did not elaborate on what effect the removal of the curbs would have. On Tuesday, the cabinet relaxed management rules for foreign insurers and banks, giving them easier access to China, and wider business scope. China will also support local governments' efforts to attract more foreign investment and allow foreign companies to be more flexible in choosing how they borrow funds from abroad, the cabinet said. China will not allow forced technology transfers by foreign firms, it said. Stabilising foreign investment is part of Beijing's policies to support the slowing economy that has been hit by the country's trade war with the United States. In 2007, HSBC Holdings, Standard Chartered Bank, Bank of East Asia and Citigroup became the first foreign banks allowed to set up locally-incorporated subsidiaries in China as Beijing gradually opened up the sector. But hampered by numerous restrictions on business scopes and operations such as outlet openings, the roughly 40 foreign banks with local units operating in China account for a tiny fraction of a market dominated by state-owned rivals such as Industrial and Commercial Bank of China and Bank of China. "Many people say 'the wolves are coming', but my observation is that...through opening, Chinese regulators intend to introduce technology and talents, but it doesn't mean foreign players can grab a big market share in China," Xin He, Societe Generale's China head of global markets told a financial conference over the weekend. He added that the French bank has retreated from its retail business in China after realising that "foreign banks cannot compete with Chinese players in this business segment." In the securities sector, China last year relaxed rules to allow foreign brokerages to own a majority stake in Chinese ventures. China said last week foreign ownership limits in the sector will be scrapped completely on Dec. 1, 2020. UBS Group, JPMorgan Chase and Japan's Nomura Holdings have obtained regulatory approval to set up majority-owned China ventures. But China has yet to open more sensitive areas of its financial industry. US payments card giants Mastercard Inc and Visa Inc are still awaiting regulatory approval to conduct yuan clearing business in the country. China's economic growth is expected to slow to a near 30-year low of 6.2 per cent this year and cool further to 5.9 per cent in 2020, a Reuters poll showed, even as Beijing steps up policy stimulus. The government has been leaning heavily on fiscal stimulus to support the economy, including rolling out big tax cuts and increased spending on infrastructure investment. Tax and fee cuts amounted to 1.5 trillion yuan in the first eight months, which has helped ease the burden on firms, boost incomes and employment, with full-year reductions set to exceed 2 trillion yuan, the cabinet said. The government will also support local governments facing fiscal difficulties to ensure wage payments, the cabinet said.

China to scrap business curbs on foreign banks, brokerages

Gravitas: Indian Banks Face Credibility Crisis

If Your Bank Fails, You Could Very Well Lose A Large Part OF Your Savings. #Gravitas

Gravitas: What Happens When A Bank Goes Bust

Government's First Priority Now Is To Address The Concerns Of The Depositors Of PMC Bank. #WIONEdit #Gravitas

WION Edit: PMC Bank Scam: Lessons To Learn

PMC Bank Scam: Government, RBI, Fraudulent Bankers & Auditors Are All At Fault.

Gravitas: PMC Bank Scam: Who's To Blame?

Union Finance Minister Nirmala Sitharaman on Thursday reviewed the performance of the banks in a meeting with the top management of public sector bank.

"Finance Minister reviewed at length the implementation of series of measures, following extensive stakeholder consultations, announced since 23.8.2019, including consolidation, to support economic growth," a press statement said.&nbsp;

Discussion held on the performance of the banks was carried out with a focus on supporting credit needs of the economy, in particular, the needs of sectors such as NBFCs, HFCs, MSMEs, sectors under stress and enabling better access to cheaper credit.

At the end of August 2019, overall credit growth in the banking sector stood at 10.1 per cent on a year-on-year basis, which is in parallel with record recoveries and cleaning of bank balance-sheets showing better quality of asset book, it said.

The Finance Minister was apprised that banks loan disbursement to key sector remains robust, with the disbursement of Rs 11.83 lakh crore done for MSME sector in FY 2018-19 as against Rs 8.53 lakh crore done in FY 2017-18.&nbsp;

Bank has also continued to support the housing sector by disbursing Rs. 2.19 lakh crore for home loans in FY 2018-19 as against Rs 1.81 lakh crore in FY 2017-18.

Pool buy-out of NBFC/HFC post-Septemeber, 2018 till Sept 15- 2019 was Rs 93,018 crore, including Rs 9,155 crore under the newly launched partial credit guarantee scheme.&nbsp;

Proposals of another Rs 33,200 crore under the new scheme are also in the pipeline.

Union Finance Minister Nirmala Sitharaman on Thursday reviewed the performance of the banks in a meeting with the top management of public sector bank. "Finance Minister reviewed at length the implementation of series of measures, following extensive stakeholder consultations, announced since 23.

Union Finance Minister Nirmala Sitharaman on Thursday reviewed the performance of the banks in a meeting with the top management of public sector bank. "Finance Minister reviewed at length the implementation of series of measures, following extensive stakeholder consultations, announced since 23.8.2019, including consolidation, to support economic growth," a press statement said. Discussion held on the performance of the banks was carried out with a focus on supporting credit needs of the economy, in particular, the needs of sectors such as NBFCs, HFCs, MSMEs, sectors under stress and enabling better access to cheaper credit. At the end of August 2019, overall credit growth in the banking sector stood at 10.1 per cent on a year-on-year basis, which is in parallel with record recoveries and cleaning of bank balance-sheets showing better quality of asset book, it said. The Finance Minister was apprised that banks loan disbursement to key sector remains robust, with the disbursement of Rs 11.83 lakh crore done for MSME sector in FY 2018-19 as against Rs 8.53 lakh crore done in FY 2017-18. Bank has also continued to support the housing sector by disbursing Rs. 2.19 lakh crore for home loans in FY 2018-19 as against Rs 1.81 lakh crore in FY 2017-18. Pool buy-out of NBFC/HFC post-Septemeber, 2018 till Sept 15- 2019 was Rs 93,018 crore, including Rs 9,155 crore under the newly launched partial credit guarantee scheme. Proposals of another Rs 33,200 crore under the new scheme are also in the pipeline.

Finance Minister Nirmala Sitharaman reviews performance of banks with top management

Indian shares closed over 1 per cent&nbsp;lower on Thursday, with financial and metal stocks falling the most, as markets remained wary of government's measures to revive slowing economic growth.

The broader NSE Nifty ended 1.25 per cent&nbsp;down at 10,704.80, while the benchmark BSE Sensex fell 1.29 per cent&nbsp;to 36,093.47.

"There is a clear disappointment in the market. The government is showing intent to help, but that is not enough to calm down investors", said Saurabh Jain, assistant vice-president of research at SMC Global Securities in New Delhi.

"There is chaos and the benefit of the doubt that markets were giving to the government that they may come to the rescue is not holding up."

Indian markets have been hammered so far this week on concerns around surging crude prices and slowing economic growth, both at home and globally.

Yes Bank Ltd, which fell 15.76 per cent,&nbsp;was the top decliner on the NSE index.

The Nifty PSU bank index shed 2.25 per cent,&nbsp;with all 12 constituents closing below 1 per cent.

The Nifty Metals index settled 1.63 per cent&nbsp;lower, with 13 out of 15 constituents finishing in the red.

Shares of lender Indiabulls Housing Finance Ltd fell as much as 9.06 per cent&nbsp;to its lowest in nearly five years.

Meanwhile, only seven out of 50 stocks on the blue-chip index ended higher.

Indian shares closed over 1 per cent lower on Thursday, with financial and metal stocks falling the most, as markets remained wary of government's measures to revive slowing economic growth.

Indian shares closed over 1 per cent lower on Thursday, with financial and metal stocks falling the most, as markets remained wary of government's measures to revive slowing economic growth. The broader NSE Nifty ended 1.25 per cent down at 10,704.80, while the benchmark BSE Sensex fell 1.29 per cent to 36,093.47. "There is a clear disappointment in the market. The government is showing intent to help, but that is not enough to calm down investors", said Saurabh Jain, assistant vice-president of research at SMC Global Securities in New Delhi. "There is chaos and the benefit of the doubt that markets were giving to the government that they may come to the rescue is not holding up." Indian markets have been hammered so far this week on concerns around surging crude prices and slowing economic growth, both at home and globally. Yes Bank Ltd, which fell 15.76 per cent, was the top decliner on the NSE index. The Nifty PSU bank index shed 2.25 per cent, with all 12 constituents closing below 1 per cent. The Nifty Metals index settled 1.63 per cent lower, with 13 out of 15 constituents finishing in the red. Shares of lender Indiabulls Housing Finance Ltd fell as much as 9.06 per cent to its lowest in nearly five years. Meanwhile, only seven out of 50 stocks on the blue-chip index ended higher.

Nifty, Sensex end over 1% lower; banks, metal stocks take a beating

Indian shares closed over 1 per cent&nbsp;lower on Thursday, with financial and metal stocks falling the most, as markets remained wary of government's measures to revive slowing economic growth.

The broader NSE Nifty ended 1.25 per cent&nbsp;down at 10,704.80, while the benchmark BSE Sensex fell 1.29 per cent&nbsp;to 36,093.47.

"There is a clear disappointment in the market. The government is showing intent to help, but that is not enough to calm down investors", said Saurabh Jain, assistant vice-president of research at SMC Global Securities in New Delhi.

"There is chaos and the benefit of doubt that markets were giving to the government that they may come to the rescue is not holding up."

Indian markets have been hammered so far this week on concerns around surging crude prices and slowing economic growth, both at home and globally.

Yes Bank Ltd, which fell 15.76 per cent,&nbsp;was the top decliner on the NSE index.

The Nifty PSU bank index shed 2.25 per cent,&nbsp;with all 12 constituents closing below 1 per cent.

The Nifty Metals index settled 1.63 per cent&nbsp;lower, with 13 out of 15 constituents finishing in the red.

Shares of lender Indiabulls Housing Finance Ltd fell as much as 9.06 per cent&nbsp;to its lowest in nearly five years.

Meanwhile, only seven out of 50 stocks on the blue-chip index ended higher.

Indian shares closed over 1 per cent lower on Thursday, with financial and metal stocks falling the most, as markets remained wary of government's measures to revive slowing economic growth. The broader NSE Nifty ended 1.25 per cent down at 10,704.80, while the benchmark BSE Sensex fell 1.29 per cent to 36,093.47. "There is a clear disappointment in the market. The government is showing intent to help, but that is not enough to calm down investors", said Saurabh Jain, assistant vice-president of research at SMC Global Securities in New Delhi. "There is chaos and the benefit of doubt that markets were giving to the government that they may come to the rescue is not holding up." Indian markets have been hammered so far this week on concerns around surging crude prices and slowing economic growth, both at home and globally. Yes Bank Ltd, which fell 15.76 per cent, was the top decliner on the NSE index. The Nifty PSU bank index shed 2.25 per cent, with all 12 constituents closing below 1 per cent. The Nifty Metals index settled 1.63 per cent lower, with 13 out of 15 constituents finishing in the red. Shares of lender Indiabulls Housing Finance Ltd fell as much as 9.06 per cent to its lowest in nearly five years. Meanwhile, only seven out of 50 stocks on the blue-chip index ended higher.

The Sensex and the Nifty closed higher on Friday, led by a rally in banks and auto stocks, and notched up gains for the week as investors cheered signs of progress in the trade dispute between the United States and China.

The Nifty closed 0.85% up at 11,075.90, while the Sensex ended 0.76% higher at 37,384.99.&nbsp;

For the week, the Nifty and the Sensex posted gains of 1.18% and 1.09%, respectively.

US President Donald Trump said on Thursday he preferred a comprehensive trade deal with China, but did not rule out the possibility of an interim pact, even as he said an "easy" agreement would not be possible.

In the domestic market, the auto index was up 1.05% at close, while the banking index ended 1.01% higher.

Oil marketing companies led gains on the blue-chip index, with Bharat Petroleum Corp closing up 6.34% and Indian Oil Corp ending 4.58% higher, as oil prices slipped to around $60 a barrel on Friday.

Indiabulls Housing Finance was the top loser and closed 1.59% lower.

The Sensex and the Nifty closed higher on Friday, led by a rally in banks and auto stocks, and notched up gains for the week as investors cheered signs of progress in the trade dispute between the United States and China.

The Sensex and the Nifty closed higher on Friday, led by a rally in banks and auto stocks, and notched up gains for the week as investors cheered signs of progress in the trade dispute between the United States and China. The Nifty closed 0.85% up at 11,075.90, while the Sensex ended 0.76% higher at 37,384.99. For the week, the Nifty and the Sensex posted gains of 1.18% and 1.09%, respectively. US President Donald Trump said on Thursday he preferred a comprehensive trade deal with China, but did not rule out the possibility of an interim pact, even as he said an "easy" agreement would not be possible. In the domestic market, the auto index was up 1.05% at close, while the banking index ended 1.01% higher. Oil marketing companies led gains on the blue-chip index, with Bharat Petroleum Corp closing up 6.34% and Indian Oil Corp ending 4.58% higher, as oil prices slipped to around $60 a barrel on Friday. Indiabulls Housing Finance was the top loser and closed 1.59% lower.

Sensex, Nifty end higher on rally in banks, autos

The merger of 10 public sector banks (PSBs) to form four big lenders will create more jobs and not lead to any retrenchment as being claimed by some trade unions, Finance Secretary Rajiv Kumar has said.

"When the size of a bank becomes big, then its business will also grow, resulting in more job creation. There is no question of retrenchment," he told ANI in an exclusive interview.

"Look at the past example of mergers with State Bank of India. See the example of three banks merging with Bank of Baroda. There was no retrenchment. This is an issue of providing better facilities to bank employees," said Kumar.

The merger of PSBs is imperative for India to become a five trillion dollar economy in the next five years. "You have to adopt a banking system which is clean and impactful. In 2017, there were 27 PSBs. Now we have only 12."

Kumar said there will be three types of banks in future: PSBs with a strong national presence and global reach, PSBs with a national presence and PSBs with a regional presence. After the merger, PSBs can do investments, cut expenditure and increase facilities for customers. The merger will benefit customers in tier 2 and tier 3 cities, he added.

Kumar said the merger will benefits employees working in small banks. Besides, they will have more opportunities for transfers. For example, the merger of Indian Bank and Allahabad Bank will give opportunities to employees to move from North to South, or the other way round.

"If there is any problem, then the government is there for solutions," he said.

The merger of 10 public sector banks (PSBs) to form four big lenders will create more jobs and not lead to any retrenchment as being claimed by some trade unions, Finance Secretary Rajiv Kumar has said.

The merger of 10 public sector banks (PSBs) to form four big lenders will create more jobs and not lead to any retrenchment as being claimed by some trade unions, Finance Secretary Rajiv Kumar has said. "When the size of a bank becomes big, then its business will also grow, resulting in more job creation. There is no question of retrenchment," he told ANI in an exclusive interview. "Look at the past example of mergers with State Bank of India. See the example of three banks merging with Bank of Baroda. There was no retrenchment. This is an issue of providing better facilities to bank employees," said Kumar. The merger of PSBs is imperative for India to become a five trillion dollar economy in the next five years. "You have to adopt a banking system which is clean and impactful. In 2017, there were 27 PSBs. Now we have only 12." Kumar said there will be three types of banks in future: PSBs with a strong national presence and global reach, PSBs with a national presence and PSBs with a regional presence. After the merger, PSBs can do investments, cut expenditure and increase facilities for customers. The merger will benefit customers in tier 2 and tier 3 cities, he added. Kumar said the merger will benefits employees working in small banks. Besides, they will have more opportunities for transfers. For example, the merger of Indian Bank and Allahabad Bank will give opportunities to employees to move from North to South, or the other way round. "If there is any problem, then the government is there for solutions," he said.

Finance Secretary dispels fears of job losses after merger of 10 PSU banks

<a href="https://www.wionews.com/india-news/sitharaman-gives-mantra-of-restraint-to-tax-collectors-but-says-deadlines-are-realistic-246076">Finance Minister Nirmala Sithraman</a> on Friday announced four state-run banks mergers.&nbsp;India will now have 12 Public Sector Banks from 27.

While Punjab National Bank, Oriental Bank of Commerce and United Bank will merge, Sitharaman announced merger plans of three other PSU banks.

Canara Bank and Syndicate Bank will merge; Union Bank of India, Andhra Bank and Corporation Bank will come together while Indian bank will merge with Allahabad Bank.

<div class="ui-state-default" contenteditable="false">
<div class="twitter-block" draggable="false">
<blockquote class="twitter-tweet">
Finance Minister Nirmala Sitharaman: Punjab National Bank, Oriental Bank of Commerce and United Bank will be brought together and they shall form the second largest public sector bank with business of Rs 17.95 Lakh Crore. <a href="https://t.co/QhFCMVq2Gn">pic.twitter.com/QhFCMVq2Gn</a>
— ANI (@ANI) <a href="https://twitter.com/ANI/status/1167392602284412928?ref_src=twsrc%5Etfw">August 30, 2019</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></div>
<a class="close-mark close-div" href="#" id="jqclosemark">×</a></div>

Together, Punjab National Bank, Oriental Bank of Commerce and United Bank merger shall form the second largest public sector bank with the business of Rs 17.95 Lakh Crore, Sitharaman added.&nbsp;

The Canara Bank merger with Syndicate Bank will be the fourth largest Public Sector Bank with a business of Rs 15.20 lakh crores.

<div class="ui-state-default" contenteditable="false">
<div class="twitter-block" draggable="false">
<blockquote class="twitter-tweet">
Finance Minister Nirmala Sitharaman: Canara Bank with (merge) Syndicate Bank, they will be the fourth largest Public Sector Bank with business of Rs 15.20 lakh crores. <a href="https://t.co/nRshTrYLxS">pic.twitter.com/nRshTrYLxS</a>
— ANI (@ANI) <a href="https://twitter.com/ANI/status/1167393394982674432?ref_src=twsrc%5Etfw">August 30, 2019</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></div>
<a class="close-mark close-div" href="#" id="jqclosemark">×</a></div>

The merger between Union Bank of India, Andhra Bank and Corporation Bank shall become the fifth largest public sector bank now whereas Indian Bank amalgamation with Allahabad Bank will be the seventh-largest Public Sector Bank with a business amounting to Rs 8.08 lakh crores.

<div class="ui-state-default" contenteditable="false">
<div class="twitter-block" draggable="false">
<blockquote class="twitter-tweet">
Finance Minister Nirmala Sitharaman: Indian Bank with (merge) Allahabad Bank, they will be the seventh largest Public Sector Bank with business of Rs 8.08 lakh crores. <a href="https://t.co/4cFafOybzH">pic.twitter.com/4cFafOybzH</a>
— ANI (@ANI) <a href="https://twitter.com/ANI/status/1167393736105455618?ref_src=twsrc%5Etfw">August 30, 2019</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></div>
<a class="close-mark close-div" href="#" id="jqclosemark">×</a></div>

During her address, the finance minister stated that the Gross Non Performing Assets have come down from 8.65 lakh crores to 7.90 lakh crores.

"Specialised agencies have been set up who are monitoring every loan which is over Rs 250 crores," she said, adding that loan recoveries have hit a recover level of Rs.1,21,076 crore.

Finance secretary Rajeev Kumar said that there has been no retrenchment so far and that there is no of the same.&nbsp;

"The benefits of employment and HR will improve, with amalgamation the best combination will be taken up," he said.&nbsp;

Just yesterday, the Reserve Bank of India in its annual report revealed that&nbsp;the number of <a href="https://www.wionews.com/business-economy/bank-frauds-climb-by-74-to-rs-71543-crore-in-fy19-rbi-annual-report-246433">frauds reported by banks has shot</a> up by 15 per cent in the financial 2018-19 on a year-on-year basis.&nbsp;

The amount involved in such frauds rose by 73.8 per cent, though mostly related to occurrences in earlier years.&nbsp;The banking sector reported 6,801 frauds involving Rs 71,542.93 crore in the financial year 2018-19 as opposed to 5,916 cases involving Rs 41,167.04 crore reported in the previous financial year.

"The average lag between the date of occurrence and its detection by banks was 22 months," while the "average lag for large frauds, i.e. Rs 1 billion and above, amounting to Rs 522 billion reported during 2018-19, was 55 months," the top bank stated in its report which was uploaded on its website.&nbsp;

The bulk of frauds reported in 2018-19 come from bank groups PSBs that constitute the largest market share in bank lending, followed by private sector banks and foreign banks.&nbsp;

Finance Minister Nirmala Sithraman on Friday announced four state-run banks mergers. India will now have 12 Public Sector Banks from 27. While Punjab National Bank, Oriental Bank of Commerce and United Bank will merge, Sitharaman announced merger plans of three other PSU banks.

Finance Minister Nirmala Sithraman on Friday announced four state-run banks mergers. India will now have 12 Public Sector Banks from 27. While Punjab National Bank, Oriental Bank of Commerce and United Bank will merge, Sitharaman announced merger plans of three other PSU banks. Canara Bank and Syndicate Bank will merge; Union Bank of India, Andhra Bank and Corporation Bank will come together while Indian bank will merge with Allahabad Bank. Finance Minister Nirmala Sitharaman: Punjab National Bank, Oriental Bank of Commerce and United Bank will be brought together and they shall form the second largest public sector bank with business of Rs 17.95 Lakh Crore. pic.twitter.com/QhFCMVq2Gn — ANI (@ANI) August 30, 2019 × Together, Punjab National Bank, Oriental Bank of Commerce and United Bank merger shall form the second largest public sector bank with the business of Rs 17.95 Lakh Crore, Sitharaman added. The Canara Bank merger with Syndicate Bank will be the fourth largest Public Sector Bank with a business of Rs 15.20 lakh crores. Finance Minister Nirmala Sitharaman: Canara Bank with (merge) Syndicate Bank, they will be the fourth largest Public Sector Bank with business of Rs 15.20 lakh crores. pic.twitter.com/nRshTrYLxS — ANI (@ANI) August 30, 2019 × The merger between Union Bank of India, Andhra Bank and Corporation Bank shall become the fifth largest public sector bank now whereas Indian Bank amalgamation with Allahabad Bank will be the seventh-largest Public Sector Bank with a business amounting to Rs 8.08 lakh crores. Finance Minister Nirmala Sitharaman: Indian Bank with (merge) Allahabad Bank, they will be the seventh largest Public Sector Bank with business of Rs 8.08 lakh crores. pic.twitter.com/4cFafOybzH — ANI (@ANI) August 30, 2019 × During her address, the finance minister stated that the Gross Non Performing Assets have come down from 8.65 lakh crores to 7.90 lakh crores. "Specialised agencies have been set up who are monitoring every loan which is over Rs 250 crores," she said, adding that loan recoveries have hit a recover level of Rs.1,21,076 crore. Finance secretary Rajeev Kumar said that there has been no retrenchment so far and that there is no of the same. "The benefits of employment and HR will improve, with amalgamation the best combination will be taken up," he said. Just yesterday, the Reserve Bank of India in its annual report revealed that the number of frauds reported by banks has shot up by 15 per cent in the financial 2018-19 on a year-on-year basis. The amount involved in such frauds rose by 73.8 per cent, though mostly related to occurrences in earlier years. The banking sector reported 6,801 frauds involving Rs 71,542.93 crore in the financial year 2018-19 as opposed to 5,916 cases involving Rs 41,167.04 crore reported in the previous financial year. "The average lag between the date of occurrence and its detection by banks was 22 months," while the "average lag for large frauds, i.e. Rs 1 billion and above, amounting to Rs 522 billion reported during 2018-19, was 55 months," the top bank stated in its report which was uploaded on its website. The bulk of frauds reported in 2018-19 come from bank groups PSBs that constitute the largest market share in bank lending, followed by private sector banks and foreign banks.

Mega bank reforms: Finance Minister Nirmala Sitharaman announces 4 state-run banks mergers

Indian shares reversed course to end lower on Tuesday, dragged by heavyweight Reliance Industries Ltd and banking stocks, as weak earnings continued to dampen investor sentiment.

The broader NSE Nifty ended 0.93% down at 11,085.40, its lowest close since March 8, while the benchmark BSE Sensex closed 0.77% lower at 37,397.24.

The volatility index had jumped 4.21% at the day's close.

Reliance Industries, one of India's most valuable companies, dragged markets the most as the stock was 2.4% down at closing bell.&nbsp;

The Nifty Auto index, which was higher initially, ended at 2.14% lower, its lowest level in over five years. Reuters reported on Monday the country's largest lender State Bank of India proposed to tighten lending terms to auto dealers.

SBI's shares were also 4.7% lower at the time of close, which along with most other bank stocks dragged the Nifty Bank index that ended 1.72% lower.

Cafe chain operator <a href="https://www.google.com/url?client=internal-uds-cse&amp;cx=006054055338965708568:09spwrlibei&amp;q=https://www.wionews.com/india-news/cafe-coffee-day-founder-vg-siddhartha-gone-missing-near-netravati-river-in-mangaluru-239351&amp;sa=U&amp;ved=2ahUKEwiKlpP00dzjAhXq73MBHYzNCpMQFjACegQIARAC&amp;usg=AOvVaw1pO-vcCQkeCFUXznODU8qD">Coffee Day Enterprises</a> ended 20% down after its founder went missing, while reports alleged he wrote a letter saying he was under pressure from lenders.

Among gainers, Tata Consultancy Services' shares were up 2.2%, while Bharti Airtel ended about 4% higher.

Indian shares reversed course to end lower on Tuesday, dragged by heavyweight Reliance Industries Ltd and banking stocks, as weak earnings continued to dampen investor sentiment.

Indian shares reversed course to end lower on Tuesday, dragged by heavyweight Reliance Industries Ltd and banking stocks, as weak earnings continued to dampen investor sentiment. The broader NSE Nifty ended 0.93% down at 11,085.40, its lowest close since March 8, while the benchmark BSE Sensex closed 0.77% lower at 37,397.24. The volatility index had jumped 4.21% at the day's close. Reliance Industries, one of India's most valuable companies, dragged markets the most as the stock was 2.4% down at closing bell. The Nifty Auto index, which was higher initially, ended at 2.14% lower, its lowest level in over five years. Reuters reported on Monday the country's largest lender State Bank of India proposed to tighten lending terms to auto dealers. SBI's shares were also 4.7% lower at the time of close, which along with most other bank stocks dragged the Nifty Bank index that ended 1.72% lower. Cafe chain operator Coffee Day Enterprises ended 20% down after its founder went missing, while reports alleged he wrote a letter saying he was under pressure from lenders. Among gainers, Tata Consultancy Services' shares were up 2.2%, while Bharti Airtel ended about 4% higher.

Sensex, Nifty reverse course to close lower; Reliance Industries, banks drag

In a country that is diverse and divided by culture and socio-economic barriers, financial inclusion is a challenge. Given the fact that boundaries are blurring, and consumer spending is on the rise, Indian masses are growing aspirational and moving to greener pastures for improving their lives.&nbsp;

In such a scenario, they are seeking all monetary options that can to make their dreams come true. Traditionally, there have been several methods of lending and borrowing amongst the unbanked masses of the country, which has resulted in a large population remaining excluded from the formal system that has hindered economic growth at the bottom of the pyramid.

That is why we still have almost 80 per cent of the population as unbanked and underserved because they are not financially literate and do not understand the concept of formal lending.&nbsp;

Financial literacy is much more than just a sharp acuity for handling money. It is a powerful source for the masses to gain access to formal financial systems and grow their monetary prospects.&nbsp;

Once aware of the options, individuals realise that borrowing from formal systems can unlock opportunities, which not just helps grow their wealth, but also increases their saving capabilities. &nbsp;

While there has been an evolution of sorts in the urban and semi-urban areas, it is the masses in the hinterland, which are missing out on the benefits.&nbsp;

In order to cater to an urgent requirement, they continue to borrow from informal sectors (family, friends, and moneylenders). Even though the availability and the provision of money from such sectors are alarmingly quick, there exists a flip side to it, which includes social as well as financial concerns.&nbsp;

Borrowing from the informal sector leads to a lack of financial discipline, as flexibility gives rise to an even bigger liability than the initially borrowed sum, thus becoming an unmanageable non-transparent spiral. The individual is caught in a vicious circle of borrowing only to pay back previous sums.&nbsp;

Formal lending from the fiscal sector provides people with multiple benefits, one of them being the concept of credit rating. It is a respectable way of becoming a part of the formal world of the financial sector and eventually trailing into banking systems. This is what is known as financial inclusion. The process is rather simple — you take a loan, follow a timely pattern of EMIs and earn a credit ranking.&nbsp;

It is a transparent method agreed upon between the borrower and lender with regulatory checks and balances and leaves. Usually, a first-time borrower with no credit history could borrow for fulfilling the smallest of aspirations — a mobile upgrade, a refrigerator or even education and marriage of his children.

It is a myth that one needs to be academically sound to be financially literate. One may start with not being averse to being a part of the formal financial sector — it is important to understand that the formal sectors are present in order to make dreams come true in a systematic way.&nbsp;

To be able to manage basic electronic-based financial transactions and modern methods (example: phone-based) is another way an individual may start his journey on the path of financial literacy. &nbsp;

Along with this, being disciplined in the course of paying back loans and acquiring good track record as well as saving money, is like education.&nbsp;

Lately, the government and the Reserve Bank of India have been laying thrust on financial inclusion across the country. Several policy changes and initiatives have been initiated.

Micro-finance institutions have been seen to contribute immensely to the financially under-penetrated regions. Digitisation of processes, payment banks and small finance banks have all helped improve the outreach of formal financial services to economically disadvantaged sections even in geographically remote regions.&nbsp;

However, the road is yet long. Clearly, the lack of effective and broad-based financial and digital literacy is inhibiting full-scale implementation.&nbsp;

The pinnacle of the process of progress will only be achieved when all citizens decide to empower themselves by joining hands with the formal financial sector and become a part of the big Indian dream to realise their own small, yet important dreams.&nbsp; 
&nbsp;

(This article was originally published on The DNA. Read the <a href="https://www.dnaindia.com/analysis/column-financial-literacy-enables-poorest-to-follow-their-dreams-2776729">original article</a>)

(Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL.)&nbsp; 
&nbsp; 
&nbsp;

In a country that is diverse and divided by culture and socio-economic barriers, financial inclusion is a challenge. Given the fact that boundaries are blurring, and consumer spending is on the rise, Indian masses are growing aspirational and moving to greener pastures for improving their lives.

In a country that is diverse and divided by culture and socio-economic barriers, financial inclusion is a challenge. Given the fact that boundaries are blurring, and consumer spending is on the rise, Indian masses are growing aspirational and moving to greener pastures for improving their lives. In such a scenario, they are seeking all monetary options that can to make their dreams come true. Traditionally, there have been several methods of lending and borrowing amongst the unbanked masses of the country, which has resulted in a large population remaining excluded from the formal system that has hindered economic growth at the bottom of the pyramid. That is why we still have almost 80 per cent of the population as unbanked and underserved because they are not financially literate and do not understand the concept of formal lending. Financial literacy is much more than just a sharp acuity for handling money. It is a powerful source for the masses to gain access to formal financial systems and grow their monetary prospects. Once aware of the options, individuals realise that borrowing from formal systems can unlock opportunities, which not just helps grow their wealth, but also increases their saving capabilities. While there has been an evolution of sorts in the urban and semi-urban areas, it is the masses in the hinterland, which are missing out on the benefits. In order to cater to an urgent requirement, they continue to borrow from informal sectors (family, friends, and moneylenders). Even though the availability and the provision of money from such sectors are alarmingly quick, there exists a flip side to it, which includes social as well as financial concerns. Borrowing from the informal sector leads to a lack of financial discipline, as flexibility gives rise to an even bigger liability than the initially borrowed sum, thus becoming an unmanageable non-transparent spiral. The individual is caught in a vicious circle of borrowing only to pay back previous sums. Formal lending from the fiscal sector provides people with multiple benefits, one of them being the concept of credit rating. It is a respectable way of becoming a part of the formal world of the financial sector and eventually trailing into banking systems. This is what is known as financial inclusion. The process is rather simple — you take a loan, follow a timely pattern of EMIs and earn a credit ranking. It is a transparent method agreed upon between the borrower and lender with regulatory checks and balances and leaves. Usually, a first-time borrower with no credit history could borrow for fulfilling the smallest of aspirations — a mobile upgrade, a refrigerator or even education and marriage of his children. It is a myth that one needs to be academically sound to be financially literate. One may start with not being averse to being a part of the formal financial sector — it is important to understand that the formal sectors are present in order to make dreams come true in a systematic way. To be able to manage basic electronic-based financial transactions and modern methods (example: phone-based) is another way an individual may start his journey on the path of financial literacy. Along with this, being disciplined in the course of paying back loans and acquiring good track record as well as saving money, is like education. Lately, the government and the Reserve Bank of India have been laying thrust on financial inclusion across the country. Several policy changes and initiatives have been initiated. Micro-finance institutions have been seen to contribute immensely to the financially under-penetrated regions. Digitisation of processes, payment banks and small finance banks have all helped improve the outreach of formal financial services to economically disadvantaged sections even in geographically remote regions. However, the road is yet long. Clearly, the lack of effective and broad-based financial and digital literacy is inhibiting full-scale implementation. The pinnacle of the process of progress will only be achieved when all citizens decide to empower themselves by joining hands with the formal financial sector and become a part of the big Indian dream to realise their own small, yet important dreams. (This article was originally published on The DNA. Read the original article) (Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL.)

Financial literacy enables poorest to follow their dreams

Australia's corporate regulators will be subjected to a new oversight body in a shake-up of the banking sector recommended on Monday by a high-powered independent inquiry into financial sector greed and malpractice.

The government-appointed inquiry known as a Royal Commission also advised in its landmark report that remuneration structures across the industry be overhauled to remove systemic conflicts of interest.

The commission's recommendations were released by the government after 11 months of shocking revelations of financial wrongdoing which wiped A$60 billion ($43.45 billion) from the country's top finance stocks.

"The price paid by our community has been immense and goes beyond just the financial," Australian Treasurer Josh Frydenberg said as the government promised to take action on all the recommendations.

"Businesses have been broken, and the emotional stress and personal pain have broken lives."

The inquiry's recommendations still need to be approved by parliament.

The inquiry revealed misconduct had reached into the sector's upper echelons, with top wealth manager AMP Ltd engaging in board-level deception of a regulator over the deliberate charging of customers for financial advice it never gave, costing the fund manager its chairman, CEO and several directors.

The final report from Commissioner Kenneth Hayne, a former High Court justice, found that the industry's problems were exacerbated by an unwillingness by corporations to accept responsibility.

"That is, there remains a reluctance in some entities to form and then to give practical effect to their understanding of what is ethical, of what is efficient, honest and fair, of what is the right thing to do," the report said.

Ahead of the report's release, shares in the "Big Four" banks all closed up about one per cent as investors hoped the report would at least end months of uncertainty in the sector.

However, wealth managers, whose reputations were shredded in the inquiry, were punished with IOOF Holdings Ltd stock closing down 4.5 per cent and AMP sliding to a record low. The broader market closed 0.5 per cent higher.

Watchdog bites

The Royal Commission made 76 recommendations in its final report that included a renewed focus on the corporate and prudential regulators which, it said, should be subjected to a new oversight authority.

Regulators were routinely accused throughout 68 days of Royal Commission hearings of working too closely with the banks. When misconduct was revealed, it either went unpunished or the consequences did not reflect the seriousness of what had been done, the inquiry found.

The Royal Commission used its final report on Monday to recommend that regulators use infringement notices for administrative failings, rather than issues that should be referred to a judge.

The institutional impropriety revealed during the past 12 months hurt some of society's most vulnerable customers, highlighted by the case of a blind pensioner being persuaded to guarantee a loan without warning her of the risks.

In a separate incident, an insurer used aggressive sales techniques to sell an opaque product to a young man with Down Syndrome.

The report said 24 instances of bad corporate behaviour, including the wide-spread charging of fees for services not rendered, have been referred to the regulators for possible prosecution.

Credit squeeze

During 2018, investors responded to the punishing Royal Commission hearings by pulling their money from brand-tarnished insurers, banks and fund managers. Shareholders registered their distaste by voting against the executive remuneration plans of two of Australia's biggest financial institutions, National Australia Bank and Australia and New Zealand Banking Group.

The two big banks, alongside counterparts Commonwealth Bank of Australia, Westpac Banking Corporation, and wealth managers AMP and IOOF, were among the worst hit by the inquiry, although wide-spread impropriety was also found in other sectors including insurance.

The Royal Commission's report comes ahead of an election expected in May which opinion polls suggest the centre-left Labor party will win. Labor says it expects to adopt all the commission's recommendations.

Conservative Prime Minister Scott Morrison, who initially dismissed Labor calls for a banking inquiry as a "populist whinge", has said he also expects to take up most of the recommendations.

But he has warned against overreaching and cutting off credit flows, a likely battle-line for the government as it fights for electoral survival.

Australia's corporate regulators will be subjected to a new oversight body in a shake-up of the banking sector recommended on Monday by a high-powered independent inquiry into financial sector greed and malpractice.

Australia's corporate regulators will be subjected to a new oversight body in a shake-up of the banking sector recommended on Monday by a high-powered independent inquiry into financial sector greed and malpractice. The government-appointed inquiry known as a Royal Commission also advised in its landmark report that remuneration structures across the industry be overhauled to remove systemic conflicts of interest. The commission's recommendations were released by the government after 11 months of shocking revelations of financial wrongdoing which wiped A$60 billion ($43.45 billion) from the country's top finance stocks. "The price paid by our community has been immense and goes beyond just the financial," Australian Treasurer Josh Frydenberg said as the government promised to take action on all the recommendations. "Businesses have been broken, and the emotional stress and personal pain have broken lives." The inquiry's recommendations still need to be approved by parliament. The inquiry revealed misconduct had reached into the sector's upper echelons, with top wealth manager AMP Ltd engaging in board-level deception of a regulator over the deliberate charging of customers for financial advice it never gave, costing the fund manager its chairman, CEO and several directors. The final report from Commissioner Kenneth Hayne, a former High Court justice, found that the industry's problems were exacerbated by an unwillingness by corporations to accept responsibility. "That is, there remains a reluctance in some entities to form and then to give practical effect to their understanding of what is ethical, of what is efficient, honest and fair, of what is the right thing to do," the report said. Ahead of the report's release, shares in the "Big Four" banks all closed up about one per cent as investors hoped the report would at least end months of uncertainty in the sector. However, wealth managers, whose reputations were shredded in the inquiry, were punished with IOOF Holdings Ltd stock closing down 4.5 per cent and AMP sliding to a record low. The broader market closed 0.5 per cent higher. Watchdog bites The Royal Commission made 76 recommendations in its final report that included a renewed focus on the corporate and prudential regulators which, it said, should be subjected to a new oversight authority. Regulators were routinely accused throughout 68 days of Royal Commission hearings of working too closely with the banks. When misconduct was revealed, it either went unpunished or the consequences did not reflect the seriousness of what had been done, the inquiry found. The Royal Commission used its final report on Monday to recommend that regulators use infringement notices for administrative failings, rather than issues that should be referred to a judge. The institutional impropriety revealed during the past 12 months hurt some of society's most vulnerable customers, highlighted by the case of a blind pensioner being persuaded to guarantee a loan without warning her of the risks. In a separate incident, an insurer used aggressive sales techniques to sell an opaque product to a young man with Down Syndrome. The report said 24 instances of bad corporate behaviour, including the wide-spread charging of fees for services not rendered, have been referred to the regulators for possible prosecution. Credit squeeze During 2018, investors responded to the punishing Royal Commission hearings by pulling their money from brand-tarnished insurers, banks and fund managers. Shareholders registered their distaste by voting against the executive remuneration plans of two of Australia's biggest financial institutions, National Australia Bank and Australia and New Zealand Banking Group. The two big banks, alongside counterparts Commonwealth Bank of Australia, Westpac Banking Corporation, and wealth managers AMP and IOOF, were among the worst hit by the inquiry, although wide-spread impropriety was also found in other sectors including insurance. The Royal Commission's report comes ahead of an election expected in May which opinion polls suggest the centre-left Labor party will win. Labor says it expects to adopt all the commission's recommendations. Conservative Prime Minister Scott Morrison, who initially dismissed Labor calls for a banking inquiry as a "populist whinge", has said he also expects to take up most of the recommendations. But he has warned against overreaching and cutting off credit flows, a likely battle-line for the government as it fights for electoral survival.

Australia to overhaul regulators after landmark banking inquiry

In pictures: Schools shut, banks closed for Bharat Bandh; everyday life affected

Sensex and Nifty opened Wednesday with minor gains led by financials. While BSE Sensex opened higher 128.23 points, up 0.36 per cent, to 35278.20, Nifty 50 tested 10,600-level opening at 10585.80, up 0.35 per cent.&nbsp;

At 10 am Sensex is trading higher by 320.49 points at 35,470, Nifty is higher by 100.50 points at 10,649.

Shares of banks and non-banking finance companies (NBFCs) outperformed benchmark indices, hoping that the new RBI governor might re-examine the demand for an easier prompt corrective action (PCA) framework and a special liquidity window.

Meanwhile, Rupee extended its losses&nbsp;against the US dollar after ruling Bhartiya Janata Party (BJP) suffered a setback in the three state elections, and also after the government announced a former bureaucrat as a central bank chief. At 9.15am, the rupee was trading at 72.10 a dollar, down 0.33% from its Tuesday’s close of 71.87. The currency opened at 72.02 a dollar. The 10-year government bond yield stood at 7.475% from its previous close of 7.528%.

Sensex and Nifty opened Wednesday with minor gains led by financials. While BSE Sensex opened higher 128.23 points, up 0.36 per cent, to 35278.20, Nifty 50 tested 10,600-level opening at 10585.

Sensex and Nifty opened Wednesday with minor gains led by financials. While BSE Sensex opened higher 128.23 points, up 0.36 per cent, to 35278.20, Nifty 50 tested 10,600-level opening at 10585.80, up 0.35 per cent. At 10 am Sensex is trading higher by 320.49 points at 35,470, Nifty is higher by 100.50 points at 10,649. Shares of banks and non-banking finance companies (NBFCs) outperformed benchmark indices, hoping that the new RBI governor might re-examine the demand for an easier prompt corrective action (PCA) framework and a special liquidity window. Meanwhile, Rupee extended its losses against the US dollar after ruling Bhartiya Janata Party (BJP) suffered a setback in the three state elections, and also after the government announced a former bureaucrat as a central bank chief. At 9.15am, the rupee was trading at 72.10 a dollar, down 0.33% from its Tuesday’s close of 71.87. The currency opened at 72.02 a dollar. The 10-year government bond yield stood at 7.475% from its previous close of 7.528%.

Sensex rises 300 points, Nifty above 10600 led by banks

Since jihadists were ousted from Mosul last year, taxi driver Abu Aref has ferried more than just people into Iraq's second city: he regularly smuggles envelopes stuffed with cash.

This is how salaries are paid and bills settled in the northern metropolis, despite the banks reopening since Iraqi forces seized it back last year from the Islamic State group after three years of jihadist rule.

Iraqi authorities, fearing that free flows of money could help finance an IS comeback, have not authorised even simple transfers.&nbsp;

So Mosul banks, exchange offices, and money transfer companies have watched helplessly as more rudimentary methods fill the gap.

Abu Aref said he typically carries anywhere between US $10,000 (8,800 euros) to US $50,000 at a time in his cab.&nbsp;

"I put the money in an envelope that I then tape underneath my seat," he told AFP.

The journey can be risky. One of his colleagues was recently the victim of a highway robbery along the 200-kilometre (120-mile) route between Mosul and Baiji, further south.&nbsp;

"Despite the risks, businessmen entrust this much money to me because they don't have another choice," the 35 year-old said.

IS swept into Mosul in 2014, seizing several hundred million dollars from a branch of Iraq's central bank and other financial institutions.&nbsp;

Mosul came back under Iraqi government control in July 2017 after a months-long assault that left its infrastructure devastated, but IS cells appear to remain active.&nbsp;

Security forces last month arrested nearly a dozen members of an IS financial network based in Iraq, according to a US-led coalition against the jihadists in Iraq and Syria.

The central bank has remained wary of resuming operations in Mosul, saying it wants to know "where this money comes from and where it's going".&nbsp;

To Baghdad and beyond&nbsp;

Around 20 private and state-owned banks have reopened in Mosul, allowing residents to open an account, deposit and withdraw money, and issue cheques.

But the central bank has not budged on its ban on transfers to and from the city.

That decision appears to have hurt business owners trying to rekindle economic activity in Mosul, a centuries-old trade hub with access to Iraqi, Turkish and Syrian markets.

Among them is Abdullah Basman, a Mosul native who sells computer parts brought in from other areas of Iraq and from Dubai.

To pay suppliers, he hands envelopes of cash to a driver he trusts, who rushes the money to Baghdad and wires it to other Iraqi cities or internationally to pay the shop's bills.&nbsp;

"The banks in Mosul are just buildings. Nothing more," said Basman, 27.&nbsp;

For company employee Abu Akram, the ban on bank transfers means he often goes months without a salary, which is issued from his firm's headquarters in Baghdad.&nbsp;

The 35-year-old relies on friends of relatives who traverse the dusty 400 kilometres (250 miles) south to Baghdad or travel to nearby Iraqi Kurdistan to retrieve his cash.&nbsp;

But there are hiccups.&nbsp;

"Sometimes, my company refuses to give my salary to someone other than me. With a taxi, there's a risk of an accident or of theft," Abu Akram told AFP.

Banks quiet, markets buzz&nbsp;

The reach of banks in Mosul appear to be par for the course in Iraq, where only one in ten people has an account, according to the World Bank.&nbsp;

"The banking system in Iraq is underdeveloped, dominated by inefficient state-owned banks. Some of them&nbsp;are believed to be capital deficient and extend little credit to the private sector," the multilateral lender wrote in a recent report.&nbsp;

"Private banks are small and they are mostly active in currency exchanges and wire transfers."&nbsp;

Despite the challenges, Iraqi economist Rafea Ahmed says multiple businesses and investors have already resumed operations in Mosul.&nbsp;

"They rapidly brought back their money in their own ways," he said.

Secret transfers even continued during IS's rule over the city, with family members living in Baghdad finding ways to smuggle money to relatives stuck inside Mosul.&nbsp;

Some of that cash, says Ahmed, has contributed to the revival already visible in Mosul.&nbsp;

Even if the banks sit empty, the restaurants, commercial centres, and open markets are now buzzing with activity.&nbsp;

Since jihadists were ousted from Mosul last year, taxi driver Abu Aref has ferried more than just people into Iraq's second city: he regularly smuggles envelopes stuffed with cash.

Since jihadists were ousted from Mosul last year, taxi driver Abu Aref has ferried more than just people into Iraq's second city: he regularly smuggles envelopes stuffed with cash. This is how salaries are paid and bills settled in the northern metropolis, despite the banks reopening since Iraqi forces seized it back last year from the Islamic State group after three years of jihadist rule. Iraqi authorities, fearing that free flows of money could help finance an IS comeback, have not authorised even simple transfers. So Mosul banks, exchange offices, and money transfer companies have watched helplessly as more rudimentary methods fill the gap. Abu Aref said he typically carries anywhere between US $10,000 (8,800 euros) to US $50,000 at a time in his cab. "I put the money in an envelope that I then tape underneath my seat," he told AFP. The journey can be risky. One of his colleagues was recently the victim of a highway robbery along the 200-kilometre (120-mile) route between Mosul and Baiji, further south. "Despite the risks, businessmen entrust this much money to me because they don't have another choice," the 35 year-old said. IS swept into Mosul in 2014, seizing several hundred million dollars from a branch of Iraq's central bank and other financial institutions. Mosul came back under Iraqi government control in July 2017 after a months-long assault that left its infrastructure devastated, but IS cells appear to remain active. Security forces last month arrested nearly a dozen members of an IS financial network based in Iraq, according to a US-led coalition against the jihadists in Iraq and Syria. The central bank has remained wary of resuming operations in Mosul, saying it wants to know "where this money comes from and where it's going". To Baghdad and beyond Around 20 private and state-owned banks have reopened in Mosul, allowing residents to open an account, deposit and withdraw money, and issue cheques. But the central bank has not budged on its ban on transfers to and from the city. That decision appears to have hurt business owners trying to rekindle economic activity in Mosul, a centuries-old trade hub with access to Iraqi, Turkish and Syrian markets. Among them is Abdullah Basman, a Mosul native who sells computer parts brought in from other areas of Iraq and from Dubai. To pay suppliers, he hands envelopes of cash to a driver he trusts, who rushes the money to Baghdad and wires it to other Iraqi cities or internationally to pay the shop's bills. "The banks in Mosul are just buildings. Nothing more," said Basman, 27. For company employee Abu Akram, the ban on bank transfers means he often goes months without a salary, which is issued from his firm's headquarters in Baghdad. The 35-year-old relies on friends of relatives who traverse the dusty 400 kilometres (250 miles) south to Baghdad or travel to nearby Iraqi Kurdistan to retrieve his cash. But there are hiccups. "Sometimes, my company refuses to give my salary to someone other than me. With a taxi, there's a risk of an accident or of theft," Abu Akram told AFP. Banks quiet, markets buzz The reach of banks in Mosul appear to be par for the course in Iraq, where only one in ten people has an account, according to the World Bank. "The banking system in Iraq is underdeveloped, dominated by inefficient state-owned banks. Some of them are believed to be capital deficient and extend little credit to the private sector," the multilateral lender wrote in a recent report. "Private banks are small and they are mostly active in currency exchanges and wire transfers." Despite the challenges, Iraqi economist Rafea Ahmed says multiple businesses and investors have already resumed operations in Mosul. "They rapidly brought back their money in their own ways," he said. Secret transfers even continued during IS's rule over the city, with family members living in Baghdad finding ways to smuggle money to relatives stuck inside Mosul. Some of that cash, says Ahmed, has contributed to the revival already visible in Mosul. Even if the banks sit empty, the restaurants, commercial centres, and open markets are now buzzing with activity.

Money moves again in Iraq's Mosul, but not via banks

Soon after the acquisition of the ailing IDBI Bank by insurance giant LIC, the government announced the merger of Bank of Baroda with two smaller banks not in the pink of health. The short-term profitability of the BOB will not be affected by the merger, but that the net assets of the three banks and the consolidation of branches and operations will be smooth and beneficial in the long run for the merged monolith.

Bank mergers have long been viewed with scepticism after the SBI shares and profits were pulled down following the merger with its five associate banks. Although the merger catapulted SBI to the ranks of the top 50 global banks in terms of assets, its NPAs rose from Rs 1.07 lakh crore to Rs 1.89 lakh crore after the merger, which was over 9 per cent of total advances. The real benefits of consolidation are long term after the branch reduction takes place and the cost-cutting follows after all duplicate operations and redundancies are rationalised.

Consolidation mooted long back

The consolidation of 21 public sector banks has been discussed ever since the Narsimham committee report was tabled during the early days of liberalisation in 1991. The banking sector reforms proposed by the former RBI Governor in 1991 and 1998 never took off because there was no political compulsion. Simply speaking, bank nationalisation was done because it empowered millions with banking facility and endeared Indira Gandhi to the masses. But PSU banks were out of focus post-Indira Gandhi and politicians found no reason to consolidate operations and nurture them.

But PM Narendra Modi’s politics is around banking the unbanked like Indira Gandhi. He has to nurture the PSU banks and make them healthy if they have to be milked for empowering the masses. For new social initiatives like Mudra loans, the PSU banks must be healthy. Turning the PSU banks healthy is no mean task because for decades NPAs had accumulated without stressed assets resolution.

When Raghuram Rajan tried to crack the whip on the banks under UPA II, he did not get political support. He was able to implement the Asset Quality Review norms for banks only in 2015 after which the Bank NPAs have steadily risen each quarter. The Insolvency and Bankruptcy Code IBC 2016 was thereafter put in place for resolution of stressed assets.

So, though NPAs have soared after 2015, the banks are writing off or selling its bad loans each quarter. Additionally, the weaker banks will be merged with the stronger banks to ensure that no bank becomes a liability that cannot be revived. But it is not only the weak bank with the strong bank that is going to be the consideration for mergers. There will be many other areas including the location of branches and type of advances that needs to be studied before the pairing of banks is done for the merger. Let us see why the Bank of Baroda, Vijaya Bank and Dena Bank have been paired for merger and how it should fair in the longer run.

Will merger lead to higher efficiencies?

The key issue will be whether the banks that are merging will be healthy, efficient and more viable in its operations than the current entities. Secretary Department of Financial Services Rajiv Kumar says “that the new entity is positioned for a substantial rise in customer base, market reach, operational efficiency and a wider bouquet of products and services for customers.” The merged banks will create the third largest bank in India with total business of Rs 14.82 lakh crore.

Each bank gains from the merger in some ways. The amalgamation will also give a chance for the consolidated bank to shut down the many branches that will become redundant after the merger. That will effectively cut costs and result in huge savings. For example, Vijaya Bank is traditionally strong in the southern states while Bank of Baroda is stronger in the west. Dena Bank has a very high number of branches that do little business. Each bank will have to rationalise its branches and shut down those which are doing less business at the same location. These are post-merger issues that need to be tackled with finesse, but the consolidation was overdue and the first target should be to bring down the 21 nationalised banks to anywhere between 6 to 10 amalgamated banks that are then nurtured back to health.

(This article was first published on The DNA. Read the <a href="https://www.dnaindia.com/analysis/column-mergers-likely-to-help-banking-sector-in-the-long-run-2665642">original article</a>.)

(Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL) 
&nbsp;

Soon after the acquisition of the ailing IDBI Bank by insurance giant LIC, the government announced the merger of Bank of Baroda with two smaller banks not in the pink of health.

Soon after the acquisition of the ailing IDBI Bank by insurance giant LIC, the government announced the merger of Bank of Baroda with two smaller banks not in the pink of health. The short-term profitability of the BOB will not be affected by the merger, but that the net assets of the three banks and the consolidation of branches and operations will be smooth and beneficial in the long run for the merged monolith. Bank mergers have long been viewed with scepticism after the SBI shares and profits were pulled down following the merger with its five associate banks. Although the merger catapulted SBI to the ranks of the top 50 global banks in terms of assets, its NPAs rose from Rs 1.07 lakh crore to Rs 1.89 lakh crore after the merger, which was over 9 per cent of total advances. The real benefits of consolidation are long term after the branch reduction takes place and the cost-cutting follows after all duplicate operations and redundancies are rationalised. Consolidation mooted long back The consolidation of 21 public sector banks has been discussed ever since the Narsimham committee report was tabled during the early days of liberalisation in 1991. The banking sector reforms proposed by the former RBI Governor in 1991 and 1998 never took off because there was no political compulsion. Simply speaking, bank nationalisation was done because it empowered millions with banking facility and endeared Indira Gandhi to the masses. But PSU banks were out of focus post-Indira Gandhi and politicians found no reason to consolidate operations and nurture them. But PM Narendra Modi’s politics is around banking the unbanked like Indira Gandhi. He has to nurture the PSU banks and make them healthy if they have to be milked for empowering the masses. For new social initiatives like Mudra loans, the PSU banks must be healthy. Turning the PSU banks healthy is no mean task because for decades NPAs had accumulated without stressed assets resolution. When Raghuram Rajan tried to crack the whip on the banks under UPA II, he did not get political support. He was able to implement the Asset Quality Review norms for banks only in 2015 after which the Bank NPAs have steadily risen each quarter. The Insolvency and Bankruptcy Code IBC 2016 was thereafter put in place for resolution of stressed assets. So, though NPAs have soared after 2015, the banks are writing off or selling its bad loans each quarter. Additionally, the weaker banks will be merged with the stronger banks to ensure that no bank becomes a liability that cannot be revived. But it is not only the weak bank with the strong bank that is going to be the consideration for mergers. There will be many other areas including the location of branches and type of advances that needs to be studied before the pairing of banks is done for the merger. Let us see why the Bank of Baroda, Vijaya Bank and Dena Bank have been paired for merger and how it should fair in the longer run. Will merger lead to higher efficiencies? The key issue will be whether the banks that are merging will be healthy, efficient and more viable in its operations than the current entities. Secretary Department of Financial Services Rajiv Kumar says “that the new entity is positioned for a substantial rise in customer base, market reach, operational efficiency and a wider bouquet of products and services for customers.” The merged banks will create the third largest bank in India with total business of Rs 14.82 lakh crore. Each bank gains from the merger in some ways. The amalgamation will also give a chance for the consolidated bank to shut down the many branches that will become redundant after the merger. That will effectively cut costs and result in huge savings. For example, Vijaya Bank is traditionally strong in the southern states while Bank of Baroda is stronger in the west. Dena Bank has a very high number of branches that do little business. Each bank will have to rationalise its branches and shut down those which are doing less business at the same location. These are post-merger issues that need to be tackled with finesse, but the consolidation was overdue and the first target should be to bring down the 21 nationalised banks to anywhere between 6 to 10 amalgamated banks that are then nurtured back to health. (This article was first published on The DNA. Read the original article.) (Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL)

Opinion: Mergers likely to help banking sector in the long run

Days ahead of RBI's monetary policy review, India's three major banks SBI, PNB and ICICI Bank today increased their benchmark lending rates or MCLR by up to 0.1 per cent, making loans costlier for consumers.

The new rates are effective from today.

India's largest lender SBI has increased the lending rate by 10 basis points across all tenors up to three years.

Now SBI's overnight and one-month tenors' Marginal Cost of Funds Based Lending Rate (MCLR) stands at 7.9 per cent as against 7.8 per cent, as per the SBI's website.

The MCLR for a three-year tenor increased to 8.45 per cent from 8.35 per cent earlier.

The state-owned Punjab National (PNB), the country's second largest lender, raised the MCLR for three-year and five-year tenors to 8.55 per cent and 8.7 per cent, respectively.

Country's second largest private bank ICICI Bank too said it has raised five-year tenor MCLR by 10 bps to 8.70 per cent. It has also raised the MCLR by 10 bps in loans with tenor of one year and three years.

However, lending rate remains unchanged in case of loans up to three months.

PNB has also increased the base rate to 9.25 per cent from the earlier 9.15 per cent.

Private sector bank ICICI Bank too has raised one-year MCLR by 10 bps to 8.40 per cent from today.

Other banks, sources said, were also likely to follow suit.

Most of home and auto loans are linked to MCLR.

Meanwhile, mortage lender HDFC said that it has increased its retail prime lending rate (RPLR), on which its adjustable rate home loans (ARHL) are benchmarked, by 10 basis points, effective tomorrow.

Karnataka Bank has raised its interest rates on deposits.

Interest on domestic and NRE rupee term deposits for a period of one year to two years stands revised to 7.25 per cent from 7.10 (for deposits up to Rs 10 crore) representing a hike of 15 basis points, it said in a regulatory filing.

The revised rates are effective from yesterday, it added.&nbsp

SBI, PNB and ICICI raised their benchmark lending rates by up to 0.1 per cent. The new rates are effective from Friday

Days ahead of RBI's monetary policy review, India's three major banks SBI, PNB and ICICI Bank today increased their benchmark lending rates or MCLR by up to 0.1 per cent, making loans costlier for consumers. The new rates are effective from today. India's largest lender SBI has increased the lending rate by 10 basis points across all tenors up to three years. Now SBI's overnight and one-month tenors' Marginal Cost of Funds Based Lending Rate (MCLR) stands at 7.9 per cent as against 7.8 per cent, as per the SBI's website. The MCLR for a three-year tenor increased to 8.45 per cent from 8.35 per cent earlier. The state-owned Punjab National (PNB), the country's second largest lender, raised the MCLR for three-year and five-year tenors to 8.55 per cent and 8.7 per cent, respectively. Country's second largest private bank ICICI Bank too said it has raised five-year tenor MCLR by 10 bps to 8.70 per cent. It has also raised the MCLR by 10 bps in loans with tenor of one year and three years. However, lending rate remains unchanged in case of loans up to three months. PNB has also increased the base rate to 9.25 per cent from the earlier 9.15 per cent. Private sector bank ICICI Bank too has raised one-year MCLR by 10 bps to 8.40 per cent from today. Other banks, sources said, were also likely to follow suit. Most of home and auto loans are linked to MCLR. Meanwhile, mortage lender HDFC said that it has increased its retail prime lending rate (RPLR), on which its adjustable rate home loans (ARHL) are benchmarked, by 10 basis points, effective tomorrow. Karnataka Bank has raised its interest rates on deposits. Interest on domestic and NRE rupee term deposits for a period of one year to two years stands revised to 7.25 per cent from 7.10 (for deposits up to Rs 10 crore) representing a hike of 15 basis points, it said in a regulatory filing. The revised rates are effective from yesterday, it added.

Banks raise lending rates, EMIs to get costlier

The two-day nationwide strike by employees of public sector banks (PSBs) may affect customer transactions worth up to Rs 20,000 crore, industry body Assocham said today, urging the United Forum of Bank Unions (UFBU) to call off the strike. 
 
The chamber also urged the government to come up with a stimulus plan for restoring the health of public sector banks. 
 
State-owned lenders are grappling with high levels of bad loans and as per reports their losses for the quarter ended March 2018 are set to hit a record Rs 50,000 crore which is more than double the losses of Rs 19,000 crore in preceding quarter ended December 2017, Assocham said in a statement. 
 
"Considering such a precarious situation, we at Assocham would urge the government to come up with a stimulus plan which must include restoring the PSBs to health," Assocham Secretary General D S Rawat said. 
 
"With about 10 lakh bank employees going on strike, banking operations such as cheque clearances, cash withdrawals and deposits at PSB branches across India will be affected," he added. 
 
The UFBU, an umbrella body of nine bank unions, has gone on strike against the proposed wage hike of 2 per cent as against 15 per cent given last time, All India Bank Employees Association general secretary C H Venkatachalam said. 
 
Consequently, banking activities in public sector banks across the country have been interrupted. 
 
However, operations in the new-generation private banks like ICICI Bank, HDFC Bank, Axis Bank were almost normal, barring few activities including cheque clearance. 
 
Since the strike coincides with the month-end, salary withdrawals from branches are likely to get affected. Some ATMs may also take a hit. 
Besides, deposit in branches, FD renewal, government treasury operation, money market operation would see the impact of the strike.

The chamber also urged the government to come up with a stimulus plan for restoring the health of public sector banks

The two-day nationwide strike by employees of public sector banks (PSBs) may affect customer transactions worth up to Rs 20,000 crore, industry body Assocham said today, urging the United Forum of Bank Unions (UFBU) to call off the strike. The chamber also urged the government to come up with a stimulus plan for restoring the health of public sector banks. State-owned lenders are grappling with high levels of bad loans and as per reports their losses for the quarter ended March 2018 are set to hit a record Rs 50,000 crore which is more than double the losses of Rs 19,000 crore in preceding quarter ended December 2017, Assocham said in a statement. "Considering such a precarious situation, we at Assocham would urge the government to come up with a stimulus plan which must include restoring the PSBs to health," Assocham Secretary General D S Rawat said. "With about 10 lakh bank employees going on strike, banking operations such as cheque clearances, cash withdrawals and deposits at PSB branches across India will be affected," he added. The UFBU, an umbrella body of nine bank unions, has gone on strike against the proposed wage hike of 2 per cent as against 15 per cent given last time, All India Bank Employees Association general secretary C H Venkatachalam said. Consequently, banking activities in public sector banks across the country have been interrupted. However, operations in the new-generation private banks like ICICI Bank, HDFC Bank, Axis Bank were almost normal, barring few activities including cheque clearance. Since the strike coincides with the month-end, salary withdrawals from branches are likely to get affected. Some ATMs may also take a hit. Besides, deposit in branches, FD renewal, government treasury operation, money market operation would see the impact of the strike.

Bank strike may hit transactions worth Rs 20k crore: Assocham

Enthused by the successful conclusion of Bhushan Steel case, the finance ministry expects banks to write back more than Rs 1 lakh crore after the resolution of all 12 NPA cases referred to insolvency proceedings by the RBI &nbspits first list.

Last week, Tata Group acquired controlling stake of 72.65 per cent in the debt-ridden Bhushan Steel Ltd for around Rs 36,000 crore will help in cleansing the banking system as well as boost lenders profitability.

The remaining 11 NPA cases which are in the pipeline will easily bring to the table over Rs 1 lakh crore and the amount coming from resolution under the Insolvency and Bankruptcy Code (IBC) will directly add to the bottomline and help in reduction of NPAs of the public sector banks, a senior finance ministry official told PTI.

Last year in June, RBI's internal advisory committee (IAC) identified 12 accounts, each having more than Rs 5,000 crore of outstanding loans and accounting for 25 per cent of total NPAs of banks.

Following the RBI's advisory, banks referred Bhushan Steel Ltd, Bhushan Power & Steel Ltd, Essar Steel Ltd, Jaypee Infratech Ltd, Lanco Infratech Ltd, Monnet Ispat & Energy Ltd, Jyoti Structures Ltd, Electrosteel Steels Ltd, Amtek Auto Ltd, Era Infra Engineering Ltd, Alok Industries Ltd and ABG Shipyard Ltd to NCLT. These accounts together have total outstanding loan of Rs 1.75 lakh crore.

The Kolkata Bench of the National Company Law Tribunal (NCLT) has already approved Vedanta Resources's resolution plan for acquisition of Electrosteel Steels last month.

Besides, the NCLT last month also asked the lenders of Bhushan Power & Steel to consider the bid submitted by UK-based Liberty House for the debt-ridden company.

Bhushan Power and Steel owes close to Rs 48,000 crore to banks and was referred to the NCLT by Punjab National Bank in June last year.

Last week, Bamnipal Steel Ltd (BNPL), a wholly-owned subsidiary of Tata Steel, has acquired 72.65 per cent stake in Bhushan Steel by paying around Rs 36,400 crore, of which Rs 35,200 crore will be paid to financial creditors.

The buy-out is expected to bring relief in the form of capital boost to PNB that was one of the leading lenders to the debt-ridden company, the bank said in a statement.

PNB in a statement said the bank had the second highest exposure to Bhushan Steel and will benefit greatly from this acquisition.

PNB sources say that the ledger outstanding to Bhushan Steel was Rs 3,857.49 crore while Rs 1,542.99 crore were earmarked for provisioning.

With this resolution, PNB's NPA will fall by Rs 3,857.49 crore. While the bank will recover Rs 3,050 crore of the outstanding amount it will also be able to write off Rs 807.49 crore from the provision it had held for this NPA.

The resolution will also have a direct impact on the bank's bottom-line this quarter.&nbsp

Sources say that this may have a positive effect on the bank's profitability to the tune of Rs 735.50 crore. On top of this, lenders including PNB will continue to own 12 per cent in the acquired entity giving them the opportunity to cash out later when the valuation of the company goes up.

With a current market capitalization of Rs 598 crore at the rate of Rs 27.75 per share for Bhushan Steel Ltd., the share for lenders that stands at nearly 12 per cent, works out to be Rs 72 crore.&nbsp

Another state-owned lender Bank of India (BoI) said it would be able to realise around Rs 1993 crore from the first successful NCLT resolution of Bhushan Steel.&nbsp

The remaining 11 NPA cases which are in the pipeline will easily bring to the table over Rs 1 lakh crore.

Enthused by the successful conclusion of Bhushan Steel case, the finance ministry expects banks to write back more than Rs 1 lakh crore after the resolution of all 12 NPA cases referred to insolvency proceedings by the RBI &nbspits first list. Last week, Tata Group acquired controlling stake of 72.65 per cent in the debt-ridden Bhushan Steel Ltd for around Rs 36,000 crore will help in cleansing the banking system as well as boost lenders profitability. The remaining 11 NPA cases which are in the pipeline will easily bring to the table over Rs 1 lakh crore and the amount coming from resolution under the Insolvency and Bankruptcy Code (IBC) will directly add to the bottomline and help in reduction of NPAs of the public sector banks, a senior finance ministry official told PTI. Last year in June, RBI's internal advisory committee (IAC) identified 12 accounts, each having more than Rs 5,000 crore of outstanding loans and accounting for 25 per cent of total NPAs of banks. Following the RBI's advisory, banks referred Bhushan Steel Ltd, Bhushan Power & Steel Ltd, Essar Steel Ltd, Jaypee Infratech Ltd, Lanco Infratech Ltd, Monnet Ispat & Energy Ltd, Jyoti Structures Ltd, Electrosteel Steels Ltd, Amtek Auto Ltd, Era Infra Engineering Ltd, Alok Industries Ltd and ABG Shipyard Ltd to NCLT. These accounts together have total outstanding loan of Rs 1.75 lakh crore. The Kolkata Bench of the National Company Law Tribunal (NCLT) has already approved Vedanta Resources's resolution plan for acquisition of Electrosteel Steels last month. Besides, the NCLT last month also asked the lenders of Bhushan Power & Steel to consider the bid submitted by UK-based Liberty House for the debt-ridden company. Bhushan Power and Steel owes close to Rs 48,000 crore to banks and was referred to the NCLT by Punjab National Bank in June last year. Last week, Bamnipal Steel Ltd (BNPL), a wholly-owned subsidiary of Tata Steel, has acquired 72.65 per cent stake in Bhushan Steel by paying around Rs 36,400 crore, of which Rs 35,200 crore will be paid to financial creditors. The buy-out is expected to bring relief in the form of capital boost to PNB that was one of the leading lenders to the debt-ridden company, the bank said in a statement. PNB in a statement said the bank had the second highest exposure to Bhushan Steel and will benefit greatly from this acquisition. PNB sources say that the ledger outstanding to Bhushan Steel was Rs 3,857.49 crore while Rs 1,542.99 crore were earmarked for provisioning. With this resolution, PNB's NPA will fall by Rs 3,857.49 crore. While the bank will recover Rs 3,050 crore of the outstanding amount it will also be able to write off Rs 807.49 crore from the provision it had held for this NPA. The resolution will also have a direct impact on the bank's bottom-line this quarter. Sources say that this may have a positive effect on the bank's profitability to the tune of Rs 735.50 crore. On top of this, lenders including PNB will continue to own 12 per cent in the acquired entity giving them the opportunity to cash out later when the valuation of the company goes up. With a current market capitalization of Rs 598 crore at the rate of Rs 27.75 per share for Bhushan Steel Ltd., the share for lenders that stands at nearly 12 per cent, works out to be Rs 72 crore. Another state-owned lender Bank of India (BoI) said it would be able to realise around Rs 1993 crore from the first successful NCLT resolution of Bhushan Steel.

Finance ministry expects banks to get back over Rs 1 lakh crore with resolution of 12 major NPAs

Over 23,000 cases of fraud involving a whopping Rs 1 lakh crore have been reported in the past five years in various banks, according to the Reserve Bank of India (RBI).

A total of 5,152 cases of fraud, up from over 5,000 cases in 2016-17, were reported in banks from April 2017 to March 1, 2018, it said in reply to an RTI query filed by this correspondent.

The highest ever amount of Rs 28,459 crore is said to have been involved in these cases of fraud reported from April 2017 to March 1, 2018, the central bank said.

In 2016-17, banks had reported 5,076 cases of fraud involving Rs 23,933 crore.

From 2013 to March 1, 2018, as many as 23,866 cases of fraud, of Rs 1 lakh or above in each case, were reported. A total of Rs 1,00,718 crore was involved in all the cases put together, according to the RTI reply.

Giving the break-up, the RBI said 4,693 such cases (involving Rs 18,698 crore) and 4,639 cases (involving Rs 19,455 crore) were reported in 2015-16 and 2014-15 respectively.

In 2013-14, banks reported 4,306 cases of fraud, involving Rs 10,170 crore, the central bank said.

"The reported fraud cases are processed and action is taken according to the facts and circumstances of individual cases," the RBI said.

The data assumes significance as central investigating agencies such as the CBI and the ED are looking into various big-ticket fraud cases in banks involving industrialists and others.

Among the prominent ones is the over Rs 13,000-crore fraud in the Punjab National Bank (PNB) allegedly committed by diamantaire Nirav Modi and his uncle Mehul Choksi, the promoter of Gitanjali Gems.

The CBI had recently also booked top officials of two public sector banks, a former CMD of the IDBI Bank, former Aircel promoter C Sivasankaran, his son and companies controlled by him in connection with an Rs 600-crore loan fraud in the IDBI.

The CBI has named 15 bank officials who worked at senior levels at the IDBI in 2010 and 2014 when loans were sanctioned to the companies controlled by Sivasankaran in its FIR registered on a complaint from the Central Vigilance Commission.&nbsp

Managing Director and CEO of Indian Bank Kishor Kharat (who was then MD and CEO of IDBI Bank) and his counterpart in Syndicate Bank Melwyn Rego (then Deputy Managing Director in IDBI Bank), along with then Chairman-cum-Managing Director of IDBI Bank M S Raghavan, have been named in the latest FIR filed by the CBI.

According to government data, the gross non-performing assets (NPAs) of all banks in the country, amounting to Rs 8,40,958 crore in December 2017, were led by industry loans followed by those in the services and agriculture sectors.

The highest amount of gross NPAs was for the country's largest lender, the State Bank of India, at Rs 2,01,560 crore.

Among the others, the NPA for PNB stood at Rs 55,200 crore and for IDBI Bank, Rs 44,542 crore. Bank of India had NPAs worth Rs 43,474 crore Bank of Baroda, Rs 41,649 crore Union Bank of India, Rs 38,047 crore Canara Bank, Rs 37,794 crore and ICICI Bank, Rs 33,849 crore, according to data presented by Minister of State for Finance Shiv Pratap Shukla in the Lok Sabha on March 9.

A total of 5,152 cases of fraud, up from over 5,000 cases in 2016-17, were reported in banks from April, 2017, to March 1, 2018, the Reserve Bank said.

Over 23,000 cases of fraud involving a whopping Rs 1 lakh crore have been reported in the past five years in various banks, according to the Reserve Bank of India (RBI). A total of 5,152 cases of fraud, up from over 5,000 cases in 2016-17, were reported in banks from April 2017 to March 1, 2018, it said in reply to an RTI query filed by this correspondent. The highest ever amount of Rs 28,459 crore is said to have been involved in these cases of fraud reported from April 2017 to March 1, 2018, the central bank said. In 2016-17, banks had reported 5,076 cases of fraud involving Rs 23,933 crore. From 2013 to March 1, 2018, as many as 23,866 cases of fraud, of Rs 1 lakh or above in each case, were reported. A total of Rs 1,00,718 crore was involved in all the cases put together, according to the RTI reply. Giving the break-up, the RBI said 4,693 such cases (involving Rs 18,698 crore) and 4,639 cases (involving Rs 19,455 crore) were reported in 2015-16 and 2014-15 respectively. In 2013-14, banks reported 4,306 cases of fraud, involving Rs 10,170 crore, the central bank said. "The reported fraud cases are processed and action is taken according to the facts and circumstances of individual cases," the RBI said. The data assumes significance as central investigating agencies such as the CBI and the ED are looking into various big-ticket fraud cases in banks involving industrialists and others. Among the prominent ones is the over Rs 13,000-crore fraud in the Punjab National Bank (PNB) allegedly committed by diamantaire Nirav Modi and his uncle Mehul Choksi, the promoter of Gitanjali Gems. The CBI had recently also booked top officials of two public sector banks, a former CMD of the IDBI Bank, former Aircel promoter C Sivasankaran, his son and companies controlled by him in connection with an Rs 600-crore loan fraud in the IDBI. The CBI has named 15 bank officials who worked at senior levels at the IDBI in 2010 and 2014 when loans were sanctioned to the companies controlled by Sivasankaran in its FIR registered on a complaint from the Central Vigilance Commission. Managing Director and CEO of Indian Bank Kishor Kharat (who was then MD and CEO of IDBI Bank) and his counterpart in Syndicate Bank Melwyn Rego (then Deputy Managing Director in IDBI Bank), along with then Chairman-cum-Managing Director of IDBI Bank M S Raghavan, have been named in the latest FIR filed by the CBI. According to government data, the gross non-performing assets (NPAs) of all banks in the country, amounting to Rs 8,40,958 crore in December 2017, were led by industry loans followed by those in the services and agriculture sectors. The highest amount of gross NPAs was for the country's largest lender, the State Bank of India, at Rs 2,01,560 crore. Among the others, the NPA for PNB stood at Rs 55,200 crore and for IDBI Bank, Rs 44,542 crore. Bank of India had NPAs worth Rs 43,474 crore Bank of Baroda, Rs 41,649 crore Union Bank of India, Rs 38,047 crore Canara Bank, Rs 37,794 crore and ICICI Bank, Rs 33,849 crore, according to data presented by Minister of State for Finance Shiv Pratap Shukla in the Lok Sabha on March 9.

Over 23,000 bank frauds worth Rs 1 lakh crore reported in 5 years: RBI

Non performing assets (NPAs) or bad loans in the banking sector are set to shoot up by at least Rs 8,000 crore as advances to the scam-hit Gitanjali Gems group have turned bad during the quarter ended March 31.

Banks will have to make provisioning of Rs 8,000 crore for Gitanjali alone as there have been no servicing of the working capital loan during the fourth quarter of last fiscal, sources said.

Gitanjali, among others, is the major account which has turned bad in the fourth quarter of 2017-18.

Gross NPAs of all the banks in the country amounted to Rs 8,40,958 crore in December, led by industry loans followed by services and agriculture sectors, as per the government estimates.

Gitanjali is promoted by Mehul Choksi, uncle of billionaire diamantaire Nirav Modi, who defrauded Punjab National Bank (PNB) of over Rs 13,000 crore by getting fake Letters of Undertaking/Credit (LoU/LoCs) issued from one of the bank's branches in Mumbai.

A special CBI court in Mumbai has issued non-bailable warrants (NBWs) against Modi as well as Choksi.

A consortium of 21 banks led by Allahabad Bank had first extended a working capital loan to it in 2010-11. In 2014, ICICI Bank became the lead banker as it had highest exposure of about Rs 900 crore and in line with the revised guidelines of the Reserve Bank of India.

Till December 2017, the loans to Gitanjali Gems were standard and regular debt servicing was being done. There is no servicing of debt in the last quarter ended March 31, so it has to be declared NPA by all banks, said a senior bank official of the consortium.

In 2015, the consortium had restructured working capital loans given to Gitanjali under the joint lenders' forum (JLF) mechanism.

The Gitanjali exposure was classified as a special mention account-2 (SMA-2) in 2014 after the company failed to fulfil its payment obligations for more than 60 days, triggering the formation of a JLF.

As a result, the company announced the consolidation of the business at the group level to improve cash flows and reduce costs in various activities such as sourcing, manufacturing, distribution, exporting and retailing.

It proposed the merger of three of its subsidiaries Asmi Jewellery India and Spectrum Jewellery with Nakshatra Brands and also the merger of Gitanjali Jewellery Retail and Gitanjali Lifestyle with GILI India.

Different investigating agencies, including CBI, I-T and Enforcement Directorate, are probing the fraud, which came to light in January, dubbed as the biggest banking scam in the country.

PNB had issued as many as 1,590 LoUs to Modi, Choksi and their associates.

The total number of LoUs issued to the companies of Modi, his relatives and the Nirav Modi Group are 1,213, while those to Choksi, his relatives and the Gitanjali Group are 377.

Banks will have to make provisioning of Rs 8,000 crore for Gitanjali alone as there has been no servicing of the working capital loan during the fourth quarter of last fiscal, sources said

Non performing assets (NPAs) or bad loans in the banking sector are set to shoot up by at least Rs 8,000 crore as advances to the scam-hit Gitanjali Gems group have turned bad during the quarter ended March 31. Banks will have to make provisioning of Rs 8,000 crore for Gitanjali alone as there have been no servicing of the working capital loan during the fourth quarter of last fiscal, sources said. Gitanjali, among others, is the major account which has turned bad in the fourth quarter of 2017-18. Gross NPAs of all the banks in the country amounted to Rs 8,40,958 crore in December, led by industry loans followed by services and agriculture sectors, as per the government estimates. Gitanjali is promoted by Mehul Choksi, uncle of billionaire diamantaire Nirav Modi, who defrauded Punjab National Bank (PNB) of over Rs 13,000 crore by getting fake Letters of Undertaking/Credit (LoU/LoCs) issued from one of the bank's branches in Mumbai. A special CBI court in Mumbai has issued non-bailable warrants (NBWs) against Modi as well as Choksi. A consortium of 21 banks led by Allahabad Bank had first extended a working capital loan to it in 2010-11. In 2014, ICICI Bank became the lead banker as it had highest exposure of about Rs 900 crore and in line with the revised guidelines of the Reserve Bank of India. Till December 2017, the loans to Gitanjali Gems were standard and regular debt servicing was being done. There is no servicing of debt in the last quarter ended March 31, so it has to be declared NPA by all banks, said a senior bank official of the consortium. In 2015, the consortium had restructured working capital loans given to Gitanjali under the joint lenders' forum (JLF) mechanism. The Gitanjali exposure was classified as a special mention account-2 (SMA-2) in 2014 after the company failed to fulfil its payment obligations for more than 60 days, triggering the formation of a JLF. As a result, the company announced the consolidation of the business at the group level to improve cash flows and reduce costs in various activities such as sourcing, manufacturing, distribution, exporting and retailing. It proposed the merger of three of its subsidiaries Asmi Jewellery India and Spectrum Jewellery with Nakshatra Brands and also the merger of Gitanjali Jewellery Retail and Gitanjali Lifestyle with GILI India. Different investigating agencies, including CBI, I-T and Enforcement Directorate, are probing the fraud, which came to light in January, dubbed as the biggest banking scam in the country. PNB had issued as many as 1,590 LoUs to Modi, Choksi and their associates. The total number of LoUs issued to the companies of Modi, his relatives and the Nirav Modi Group are 1,213, while those to Choksi, his relatives and the Gitanjali Group are 377.

Bank 'bad loans' in India to rise by at least Rs 8,000 crore in Q4

The Punjab National Bank branch in south Mumbai sits just down the road from both the Bombay Stock Exchange and the Reserve Bank of India, at a physical centre of one of the world&#39;s fastest growing major economies.

The branch, clad in a stately colonial edifice, is now also at the heart of a fraud case linked to billionaire jeweller Nirav Modi that has shaken confidence in a state banking sector that accounts for some 70 percent of India&#39;s banking assets.

It was here, according to accounts from Punjab National Bank executives and government investigators, that a lone middle-aged manager, later aided by his young subordinate, engineered fraudulent transactions totalling about $1.8 billion from 2011 to 2017.

The bank says it is still investigating how they were able to do so and go undetected for so long. The accounts given by current and former executives who spoke to Reuters suggest an answer as simple as it is alarming: no one was paying attention.

The still unravelling story of how the fraud happened - which includes the alleged misuse of the SWIFT interbank messaging system and incomplete ledger entries - points to a breakdown in checks and balances, and standard banking practices, they said.

The apparent failure of anyone to notice the largest fraud in Indian banking history until this January reveals a &quot;rot&quot; in the state financial sector that goes beyond one lender, said Santosh Trivedi, who spent nearly four decades at Punjab National Bank before retiring in 2016 as a senior manager of audit and inspection in the New Delhi head office.

&quot;Unless this rot is controlled at this stage, to the satisfaction of the international community, it is dangerous for the Indian system,&quot; Trivedi said.

Jeweller to the stars

Last month, Punjab National Bank, known as PNB, filed an initial criminal complaint with the country&#39;s Central Bureau of Investigation (CBI) accusing celebrity jeweller Nirav Modi and others of defrauding the bank and causing it a loss of 2.8 billion Indian rupees (more than $43 million).

The allegations against a man whose diamond creations have draped Hollywood stars such as Kate Winslet and Dakota Johnson generated a flurry of coverage across India&#39;s TV screens and newspapers. Modi has not publicly commented on the case. He and his family left the country in earlier January, according to Indian officials, and a call on Sunday to a corporate spokesperson who has handled media for Modi in the past went unanswered. No charges have been filed against him.

But as more details surfaced about what is alleged to have happened at the state-run bank, which was founded in 1894, the stakes have gotten higher.

A review of bank and government documents related to the case - and interviews with current and former PNB executives, bank auditors and experts - points to a lack of accountability and standards in the country&#39;s public banking system.

As of last September, those banks held about 87 percent of the Indian banking system&#39;s 9.46 trillion rupees (about $147 billion) of soured loans that are non-performing, restructured or rolled over.

A preliminary investigation by the nation&#39;s tax authority said of the PNB fraud that &quot;the hit Indian banks would take in the end may well exceed&quot; $3 billion, according to an internal note seen by Reuters.

&quot;Yes, there is a problem. We have recognised it,&quot; bank Chief Executive Officer Sunil Mehta said during an investor call on Friday. &quot;We are in the process of fixing it up. We&#39;ll see wherever the loopholes are there. The people-related risk, we are going to mitigate.&quot;

But despite that promise of action, one current senior executive at the bank&#39;s headquarters in New Delhi said further problems could not be ruled out.

&quot;In Indian banks, we don&#39;t work under ideal situation,&quot; the executive, who declined to be identified, said during an interview at his office. &quot;We are in the business of risk, you can&#39;t say there won&#39;t be road accidents.&quot;

Fraudulent guarantees

According to court documents filed on Saturday by the CBI, branch deputy manager Gokulnath Shetty issued a series of fraudulent Letters of Undertaking &ndash; essentially guarantees sent to other banks so that they would provide loans to a customer, in this case a group of Indian jewellery companies.

These letters were sent to overseas branches of banks, thought to be almost all Indian, that would then lend money to the jewellery firms.

Shetty did so use the bank&#39;s SWIFT system to log in with passwords that allowed him, and in at least some instances a more junior official, to serve as both the person who sent messages and as the person who reviewed them for approval, according to court documents and interviews with bank executives.

&quot;The involvement and connivance of more staff members and outsiders at this stage cannot be ruled out,&quot; said a CBI document submitted to the court in Mumbai.

Shetty is now in custody and he has not publicly responded to the allegations. Calls to a cell phone listed for his wife on court documents were not answered.

Asked about the password sharing, the senior Punjab National Bank executive said it was not best practice but in the everyday bustle of Indian banks, it happens.

&quot;When you are flooded with customers in the morning, with 101 demands, you look for shortcuts,&quot; he said. &quot;You do somebody else&#39;s work, somebody else does your work. You are not working in an ideal situation.&quot;

A second senior executive at the bank&#39;s headquarters, who also asked that his name not is used, echoed that sentiment.

After entering the transactions on SWIFT, the CBI documents said, Shetty &ndash; who worked at the same branch from 2010 to 2017 despite normal bank practices of regular rotations - did not record them on the bank&#39;s internal system.

Because PNB&#39;s internal software system was not linked with SWIFT, employees were expected to manually log SWIFT activity. If that was not done, the transactions did not show up on the bank&#39;s books.

A SWIFT spokeswoman said in a statement last week that the company does not comment on individual customers.

Altogether, there were at least 150 such fraudulent Letters of Undertaking during a seven-year period, according to a CBI official who spoke on the condition of anonymity.

In addition to detaining Shetty and the junior employee, the CBI has arrested a man who it described in court documents as both being &quot;aware about the modus operandi of the entire scams&quot; and serving as a director in &quot;15 to 16 companies of Nirav Modi Group&quot;.

An older brother of the man, Hemant Bhatt, said outside a courtroom on Saturday that he was innocent and the allegations were the result of a &quot;media trial&quot;. The brother did not give his name.

An uncle of the junior bank employee, Manoj Kharat, told a Reuters reporter outside the court that his nephew was &quot;just following orders of superiors&quot; and added, &quot;he wasn&#39;t aware of what he is doing&quot;.

All three are to be held in custody until March 3. No charges have so far been laid against them.

Financial hit

A Feb. 12 note seen by Reuters, sent from PNB to other banks and marked &quot;confidential&quot;, said: &quot;None of the transactions was routed through the CBS system&quot; - the bank&#39;s internal network &ndash; &quot;thus avoiding early detection of fraudulent activity.&quot;

The Reserve Bank of India did not respond to a request for comment about whether it had earlier detected any anomalies in Punjab National Bank&#39;s operations or whether it would take additional action in auditing banks.

In a statement, late on Friday, the central bank called the fraud at PNB &quot;a case of operational risk arising on account of delinquent behaviour by one or more employees of the bank and failure of internal controls&quot;. It also said the central bank &quot;has already undertaken a supervisory assessment of control systems in PNB and will take appropriate supervisory action&quot;.

The CBI paperwork says the fraudulent Letters of Undertaking are likely to add up to &quot;the vicinity of&quot; 60 billion rupees, or more than $930 million. Bank executives say the amount tallied by working back through internal records is $1.77 billion.

With assets of about $120 billion as of December, according to bank filings, PNB will be able to cover any associated losses, though it is still a huge hit for a bank whose stock market value was only $6.1 billion before it revealed details of the alleged fraud last week. It has since seen $1.4 billion wiped off that market capitalisation.

The mechanics of how the fraud happened, and what it says about the underlying industry culture, are worrying, said Abizer Diwanji, national leader for financial services in India at accounting firm Ernst &amp; Young.

&quot;Checks and balances are there in public banks as well but they are not followed earnestly,&quot; said Diwanji, who has tracked India&#39;s financial services industry for more than two decades.

&quot;This is where the discipline, the culture is not there. I always believe that we don&#39;t have the culture to manage risks, even operational risks. PNB is not an outlier in this.&quot;

To control such risks, most private sector banks require branches to route SWIFT messages through their central offices, Diwanji said. They also usually integrate their own software systems and SWIFT, meaning that activity such as a Letter of Undertaking being sent would get automatically recorded.

Neither is the case at PNB or most state-run banks in India, Diwanji said.

Representatives of two of the external audit firms listed on PNB&#39;s annual report for the 2016-17 fiscal year said they could not have known what happened.

&quot;It was off-books, so auditors will not be in a position to detect it,&quot; said Sudesh Punhani, a partner at Chhajed &amp; Doshi.

Asked whether the bank&#39;s failure to integrate its software system and SWIFT was a cause of concern, Neeraj Golas, a partner at R. Devendra Kumar &amp; Associates, also an external auditor of the bank, said: &quot;True, true - we have to really get into it and understand what all these things are.&quot;

As of last September, those banks held about 87 percent of the Indian banking system's 9.46 trillion rupees

The Punjab National Bank branch in south Mumbai sits just down the road from both the Bombay Stock Exchange and the Reserve Bank of India, at a physical centre of one of the world's fastest growing major economies. The branch, clad in a stately colonial edifice, is now also at the heart of a fraud case linked to billionaire jeweller Nirav Modi that has shaken confidence in a state banking sector that accounts for some 70 percent of India's banking assets. It was here, according to accounts from Punjab National Bank executives and government investigators, that a lone middle-aged manager, later aided by his young subordinate, engineered fraudulent transactions totalling about $1.8 billion from 2011 to 2017. The bank says it is still investigating how they were able to do so and go undetected for so long. The accounts given by current and former executives who spoke to Reuters suggest an answer as simple as it is alarming: no one was paying attention. The still unravelling story of how the fraud happened - which includes the alleged misuse of the SWIFT interbank messaging system and incomplete ledger entries - points to a breakdown in checks and balances, and standard banking practices, they said. The apparent failure of anyone to notice the largest fraud in Indian banking history until this January reveals a "rot" in the state financial sector that goes beyond one lender, said Santosh Trivedi, who spent nearly four decades at Punjab National Bank before retiring in 2016 as a senior manager of audit and inspection in the New Delhi head office. "Unless this rot is controlled at this stage, to the satisfaction of the international community, it is dangerous for the Indian system," Trivedi said. Jeweller to the stars Last month, Punjab National Bank, known as PNB, filed an initial criminal complaint with the country's Central Bureau of Investigation (CBI) accusing celebrity jeweller Nirav Modi and others of defrauding the bank and causing it a loss of 2.8 billion Indian rupees (more than $43 million). The allegations against a man whose diamond creations have draped Hollywood stars such as Kate Winslet and Dakota Johnson generated a flurry of coverage across India's TV screens and newspapers. Modi has not publicly commented on the case. He and his family left the country in earlier January, according to Indian officials, and a call on Sunday to a corporate spokesperson who has handled media for Modi in the past went unanswered. No charges have been filed against him. But as more details surfaced about what is alleged to have happened at the state-run bank, which was founded in 1894, the stakes have gotten higher. A review of bank and government documents related to the case - and interviews with current and former PNB executives, bank auditors and experts - points to a lack of accountability and standards in the country's public banking system. As of last September, those banks held about 87 percent of the Indian banking system's 9.46 trillion rupees (about $147 billion) of soured loans that are non-performing, restructured or rolled over. A preliminary investigation by the nation's tax authority said of the PNB fraud that "the hit Indian banks would take in the end may well exceed" $3 billion, according to an internal note seen by Reuters. "Yes, there is a problem. We have recognised it," bank Chief Executive Officer Sunil Mehta said during an investor call on Friday. "We are in the process of fixing it up. We'll see wherever the loopholes are there. The people-related risk, we are going to mitigate." But despite that promise of action, one current senior executive at the bank's headquarters in New Delhi said further problems could not be ruled out. "In Indian banks, we don't work under ideal situation," the executive, who declined to be identified, said during an interview at his office. "We are in the business of risk, you can't say there won't be road accidents." Fraudulent guarantees According to court documents filed on Saturday by the CBI, branch deputy manager Gokulnath Shetty issued a series of fraudulent Letters of Undertaking – essentially guarantees sent to other banks so that they would provide loans to a customer, in this case a group of Indian jewellery companies. These letters were sent to overseas branches of banks, thought to be almost all Indian, that would then lend money to the jewellery firms. Shetty did so use the bank's SWIFT system to log in with passwords that allowed him, and in at least some instances a more junior official, to serve as both the person who sent messages and as the person who reviewed them for approval, according to court documents and interviews with bank executives. "The involvement and connivance of more staff members and outsiders at this stage cannot be ruled out," said a CBI document submitted to the court in Mumbai. Shetty is now in custody and he has not publicly responded to the allegations. Calls to a cell phone listed for his wife on court documents were not answered. Asked about the password sharing, the senior Punjab National Bank executive said it was not best practice but in the everyday bustle of Indian banks, it happens. "When you are flooded with customers in the morning, with 101 demands, you look for shortcuts," he said. "You do somebody else's work, somebody else does your work. You are not working in an ideal situation." A second senior executive at the bank's headquarters, who also asked that his name not is used, echoed that sentiment. After entering the transactions on SWIFT, the CBI documents said, Shetty – who worked at the same branch from 2010 to 2017 despite normal bank practices of regular rotations - did not record them on the bank's internal system. Because PNB's internal software system was not linked with SWIFT, employees were expected to manually log SWIFT activity. If that was not done, the transactions did not show up on the bank's books. A SWIFT spokeswoman said in a statement last week that the company does not comment on individual customers. Altogether, there were at least 150 such fraudulent Letters of Undertaking during a seven-year period, according to a CBI official who spoke on the condition of anonymity. In addition to detaining Shetty and the junior employee, the CBI has arrested a man who it described in court documents as both being "aware about the modus operandi of the entire scams" and serving as a director in "15 to 16 companies of Nirav Modi Group". An older brother of the man, Hemant Bhatt, said outside a courtroom on Saturday that he was innocent and the allegations were the result of a "media trial". The brother did not give his name. An uncle of the junior bank employee, Manoj Kharat, told a Reuters reporter outside the court that his nephew was "just following orders of superiors" and added, "he wasn't aware of what he is doing". All three are to be held in custody until March 3. No charges have so far been laid against them. Financial hit A Feb. 12 note seen by Reuters, sent from PNB to other banks and marked "confidential", said: "None of the transactions was routed through the CBS system" - the bank's internal network – "thus avoiding early detection of fraudulent activity." The Reserve Bank of India did not respond to a request for comment about whether it had earlier detected any anomalies in Punjab National Bank's operations or whether it would take additional action in auditing banks. In a statement, late on Friday, the central bank called the fraud at PNB "a case of operational risk arising on account of delinquent behaviour by one or more employees of the bank and failure of internal controls". It also said the central bank "has already undertaken a supervisory assessment of control systems in PNB and will take appropriate supervisory action". The CBI paperwork says the fraudulent Letters of Undertaking are likely to add up to "the vicinity of" 60 billion rupees, or more than $930 million. Bank executives say the amount tallied by working back through internal records is $1.77 billion. With assets of about $120 billion as of December, according to bank filings, PNB will be able to cover any associated losses, though it is still a huge hit for a bank whose stock market value was only $6.1 billion before it revealed details of the alleged fraud last week. It has since seen $1.4 billion wiped off that market capitalisation. The mechanics of how the fraud happened, and what it says about the underlying industry culture, are worrying, said Abizer Diwanji, national leader for financial services in India at accounting firm Ernst & Young. "Checks and balances are there in public banks as well but they are not followed earnestly," said Diwanji, who has tracked India's financial services industry for more than two decades. "This is where the discipline, the culture is not there. I always believe that we don't have the culture to manage risks, even operational risks. PNB is not an outlier in this." To control such risks, most private sector banks require branches to route SWIFT messages through their central offices, Diwanji said. They also usually integrate their own software systems and SWIFT, meaning that activity such as a Letter of Undertaking being sent would get automatically recorded. Neither is the case at PNB or most state-run banks in India, Diwanji said. Representatives of two of the external audit firms listed on PNB's annual report for the 2016-17 fiscal year said they could not have known what happened. "It was off-books, so auditors will not be in a position to detect it," said Sudesh Punhani, a partner at Chhajed & Doshi. Asked whether the bank's failure to integrate its software system and SWIFT was a cause of concern, Neeraj Golas, a partner at R. Devendra Kumar & Associates, also an external auditor of the bank, said: "True, true - we have to really get into it and understand what all these things are."

PNB scam: Billion dollar diamond fraud case puts India's state banks in focus

Indian shares rose on Monday, tracking Asian peers that climbed on positive US payrolls and Chinese trade data, with investors continuing to bet on a possible win for the country&#39;s ruling party in a key state election.&nbsp;

Markets are hoping for a big success by Prime Minister Narendra Modi and his ruling Bharatiya Janata Party in assembly elections in Gujarat, with tens of thousands voting in the first stage of the polls on Saturday.

A victory would help boost the government&#39;s re-election prospects during general elections in 2019 and reinforce its reform agenda, although analysts said it was already being priced into markets, making the margin of a win crucial to further boost shares.&nbsp;Three recent big polls have predicted a victory for Modi&#39;s party, but with a greatly reduced majority.&nbsp;

&quot;If BJP wins, it&#39;s definitely good for the markets, but unless they win by a landslide like they did in Uttar Pradesh and surprise everyone, markets (NSE index) should remain rangebound in the 10,000-10,500 levels&quot;, said R.K. Gupta, managing director at Taurus Asset Management Company.&nbsp;

The broader NSE Nifty was up 0.30 per cent at 10,296.35 as of 0619 GMT, while the benchmark BSE Sensex was 0.35 per cent higher at 33,365.35.

The gains also tracked a 0.4 per cent increase in Asia shares ex-Japan after strong US payrolls data and better-than-expected Chinese trade data on Friday.&nbsp;

The PSU bank index rose as much as 1.7 per cent, with constituent State Bank of India up as much as 2 per cent.

Private sector lenders Axis Bank and HDFC Bank were up about 0.5 per cent each.&nbsp;Property developer Unitech Ltd rose as much as 19.2 per cent after a court allowed the government to take over management control of the debt-laden company on Friday.

Banks such as State Bank of India, Axis Bank, and HDFC Bank saw a rise in share prices. BSE Sensex and NSE Nifty climbed on Monday

Indian shares rose on Monday, tracking Asian peers that climbed on positive US payrolls and Chinese trade data, with investors continuing to bet on a possible win for the country's ruling party in a key state election. Markets are hoping for a big success by Prime Minister Narendra Modi and his ruling Bharatiya Janata Party in assembly elections in Gujarat, with tens of thousands voting in the first stage of the polls on Saturday. A victory would help boost the government's re-election prospects during general elections in 2019 and reinforce its reform agenda, although analysts said it was already being priced into markets, making the margin of a win crucial to further boost shares. Three recent big polls have predicted a victory for Modi's party, but with a greatly reduced majority. "If BJP wins, it's definitely good for the markets, but unless they win by a landslide like they did in Uttar Pradesh and surprise everyone, markets (NSE index) should remain rangebound in the 10,000-10,500 levels", said R.K. Gupta, managing director at Taurus Asset Management Company. The broader NSE Nifty was up 0.30 per cent at 10,296.35 as of 0619 GMT, while the benchmark BSE Sensex was 0.35 per cent higher at 33,365.35. The gains also tracked a 0.4 per cent increase in Asia shares ex-Japan after strong US payrolls data and better-than-expected Chinese trade data on Friday. The PSU bank index rose as much as 1.7 per cent, with constituent State Bank of India up as much as 2 per cent. Private sector lenders Axis Bank and HDFC Bank were up about 0.5 per cent each. Property developer Unitech Ltd rose as much as 19.2 per cent after a court allowed the government to take over management control of the debt-laden company on Friday.

Nifty, Sensex gain in early trade

Indian digital payments firm Paytm launched a niche payments bank on Tuesday, aiming to acquire 500 million customers in the next three years, the company said in a statement.

Paytm, which runs India&#39;s biggest electronic wallet, said it will offer an interest rate of 4 per cent per annum on deposits.

The Paytm Payments Bank aims to open 31 branches and 3,000 customer service points in its first year of operations, the company said.

A payments bank is an institution that can take deposits and remittances but cannot lend.

(Reuters)

A payments bank is an institution that can take deposits and remittances but cannot lend

Indian digital payments firm Paytm launched a niche payments bank on Tuesday, aiming to acquire 500 million customers in the next three years, the company said in a statement. Paytm, which runs India's biggest electronic wallet, said it will offer an interest rate of 4 per cent per annum on deposits. The Paytm Payments Bank aims to open 31 branches and 3,000 customer service points in its first year of operations, the company said. A payments bank is an institution that can take deposits and remittances but cannot lend. (Reuters)

Paytm launches payments bank

December 30 marks the end of the 50-day period Prime Minister Narendra Modi had sought to ease the initial pain of demonetisation. It also marks the end of the deadline to deposit the old Rs 500 and Rs 1000 notes or to exchange them at the banks for legal tenders.

However, people will still be allowed to deposit the old bank notes at the Reserve Bank of India (RBI).

The ordinance on demonetised currency does not propose a jail term for those holding more than 10 junked notes after the final March 31, 2017, deadline, but imposes a minimum fine of Rs 10,000.

The draft ordinance, which will be sent to President Pranab Mukherjee for his assent, will come into force from December 31.

There was a proposal for prescribing a four-year jail term, but the draft ordinance does not contain any such provision.

Those keeping the junked notes for &quot;study, research or numismatics&quot; purposes would be exempt from penalty provided they hold not more than 25 number of such notes irrespective of the denomination.

Besides, people authorised by RBI or its agencies or those holding junked notes under directions of a court would also not be penalised, as per Section 5 of the draft ordinance.

It provides for making holding of old Rs 1,000 and 500 notes after March 31 a criminal offence that will attract a fine of Rs 10,000 or five times the cash held, whichever is higher.

According to Section 6 of the &#39;Specified Bank Notes (Cessation of Liabilities) Ordinance, 2016&#39;, whoever knowingly and wilfully makes any false declarations regarding junked notes would be liable for a fine &quot;which may extend to Rs 50,000 or five times the amount of the face value of specified bank notes tendered, whichever is higher&quot;.

The ordinance also provides for amending the Reserve Bank of India (RBI) Act, 1934 to provide legislative support for extinguishing the central bank and government&#39;s liability on the demonetised banknotes that are not returned.

While the deadline for the deposit of old currency in bank or post office accounts expires on Friday, there is time till March 31 for depositing them at select RBI counters with stiff conditions.

Sources said a proposal for a four-year jail term for anyone possessing large number of demonetised currency after March 31, 2017 was not approved by the Cabinet.

As per the draft ordinance, citizens who were abroad between November 9 and December 30 are entitled to deposit the junked notes till March 31 with RBI.

The government would also bring out a separate notification for &quot;such class of persons and for such reasons as may be specified&quot; to ensure that people are not harassed and those with genuine reasons can deposit the cancelled notes.

At the time of announcing demonetisation of old Rs 500 and Rs 1,000 notes on November 8, the government had allowed holders to either exchange them or deposit in bank and post office accounts.

According to the government, the main reason for bringing out the ordinance is to &quot;have clarity and finality to the liabilities of the Reserve Bank of India (RBI) and the central government&quot; arising from the demonetisation of high value currency notes.

In case of companies found holding more than 10 junked notes, action would be taken against the officials concerned.

Proceedings could be initiated against &quot;any director, manager, secretary, or other officer or employee&quot; of the particular company.

The ordinance also provides safeguard for the government and the central bank from facing any legal proceedings.

&quot;No suit, prosecution or other legal proceeding shall lie against government, RBI or any of their officers for anything or intended to be done in good faith under this ordinance,&quot; it noted.

In 1978, a similar Ordinance was issued to end the government&#39;s liability after Rs 1,000, Rs 5,000 and Rs 10,000 notes were demonetised by the Morarji Desai-led government.

Sources said the legal amendments are needed every time the government decides to scrap any legal tender to put an end to its promissory note.

Of the Rs 15.4 lakh crore worth of currency that was scrapped, about Rs 14 lakh crore has been deposited in banks or exchanged.

&nbsp;

(PTI)

December 30 is the last day to deposit old Rs 500 and Rs 1,000 notes

December 30 marks the end of the 50-day period Prime Minister Narendra Modi had sought to ease the initial pain of demonetisation. It also marks the end of the deadline to deposit the old Rs 500 and Rs 1000 notes or to exchange them at the banks for legal tenders. However, people will still be allowed to deposit the old bank notes at the Reserve Bank of India (RBI). The ordinance on demonetised currency does not propose a jail term for those holding more than 10 junked notes after the final March 31, 2017, deadline, but imposes a minimum fine of Rs 10,000. The draft ordinance, which will be sent to President Pranab Mukherjee for his assent, will come into force from December 31. There was a proposal for prescribing a four-year jail term, but the draft ordinance does not contain any such provision. Those keeping the junked notes for "study, research or numismatics" purposes would be exempt from penalty provided they hold not more than 25 number of such notes irrespective of the denomination. Besides, people authorised by RBI or its agencies or those holding junked notes under directions of a court would also not be penalised, as per Section 5 of the draft ordinance. It provides for making holding of old Rs 1,000 and 500 notes after March 31 a criminal offence that will attract a fine of Rs 10,000 or five times the cash held, whichever is higher. According to Section 6 of the 'Specified Bank Notes (Cessation of Liabilities) Ordinance, 2016', whoever knowingly and wilfully makes any false declarations regarding junked notes would be liable for a fine "which may extend to Rs 50,000 or five times the amount of the face value of specified bank notes tendered, whichever is higher". The ordinance also provides for amending the Reserve Bank of India (RBI) Act, 1934 to provide legislative support for extinguishing the central bank and government's liability on the demonetised banknotes that are not returned. While the deadline for the deposit of old currency in bank or post office accounts expires on Friday, there is time till March 31 for depositing them at select RBI counters with stiff conditions. Sources said a proposal for a four-year jail term for anyone possessing large number of demonetised currency after March 31, 2017 was not approved by the Cabinet. As per the draft ordinance, citizens who were abroad between November 9 and December 30 are entitled to deposit the junked notes till March 31 with RBI. The government would also bring out a separate notification for "such class of persons and for such reasons as may be specified" to ensure that people are not harassed and those with genuine reasons can deposit the cancelled notes. At the time of announcing demonetisation of old Rs 500 and Rs 1,000 notes on November 8, the government had allowed holders to either exchange them or deposit in bank and post office accounts. According to the government, the main reason for bringing out the ordinance is to "have clarity and finality to the liabilities of the Reserve Bank of India (RBI) and the central government" arising from the demonetisation of high value currency notes. In case of companies found holding more than 10 junked notes, action would be taken against the officials concerned. Proceedings could be initiated against "any director, manager, secretary, or other officer or employee" of the particular company. The ordinance also provides safeguard for the government and the central bank from facing any legal proceedings. "No suit, prosecution or other legal proceeding shall lie against government, RBI or any of their officers for anything or intended to be done in good faith under this ordinance," it noted. In 1978, a similar Ordinance was issued to end the government's liability after Rs 1,000, Rs 5,000 and Rs 10,000 notes were demonetised by the Morarji Desai-led government. Sources said the legal amendments are needed every time the government decides to scrap any legal tender to put an end to its promissory note. Of the Rs 15.4 lakh crore worth of currency that was scrapped, about Rs 14 lakh crore has been deposited in banks or exchanged. (PTI)

Demonetisation: Prime Minister Modi's 50-day promise ends today

By&nbsp;<a href="http://www.dnaindia.com/authors/praveena-sharma" target="_blank" title="Praveena Sharma">Pr</a>aveena Sharma

As Indian Prime Minister Narendra Modi gets ready to address the nation on December 30, a reliable source told DNA that the government was seriously considering relaxing current restrictions on withdrawals from ATMs and banks from Rs 2,500 a day and Rs 24,000 a week respectively to Rs 4,000 per day and Rs 40,000 per week respectively.

Modi had sought 50 days to normalise the liquidity situation after he made Rs 500 and Rs 1,000 notes illegal from midnight of November 8.

<div class="ui-state-default" contenteditable="false">
<div class="row">
<div class="article-blockquote">
<div class="col-sm-10 col-sm-offset-1 blockquote-content quoteshare">
<blockquote>
<h5>All of this is expected to be announced by the PM on December 30 evening. He is planning an address (to the nation) at 8 pm in which he is going to connect what he said on November 8 and ask countrymen to be patient</h5>
</blockquote>
</div>

<div class="col-sm-1 blockquote-content">
<div class="share-blockquote"><a class="twitter popup" href="http://twitter.com/intent/tweet?text=All of this is expected to be announced by the PM on December 30 evening. He is planning an address (to the nation) at 8 pm in which he is going to connect what he said on November 8 and ask countrymen to be patient" target="_blank">&nbsp;</a></div>
</div>
<a class="close-mark close-div" href="#" id="jqquoteclosemark">&times;</a></div>
</div>
</div>

A source in the government, who spoke on condition of anonymity, said since the shortage of cash continued to persist, the restriction on withdrawal may not be completely removed but would be eased.

&quot;Today, for instance, the restriction is Rs 24,000 per week and Rs 2,500 per day; they might increase that to Rs 4,000 per day and Rs 40,000 per week, but nevertheless, will continue with the restrictions. All of this is expected to be announced by the PM on December 30 evening. He is planning an address (to the nation) at 8 pm in which he is going to connect what he said on November 8 and ask countrymen to be patient,&quot; he said.

Also, the Indian government is contemplating an ordinance to restrict holding of banned notes and penalising their possession of beyond a certain limit after December 30. However, the ordinance is likely to be issued only after the liquidity situation improves. &quot;That (ordinance) is being discussed very seriously, but there are two specific challenges. One is that in terms of the RBI (Reserve Bank of India) notification issued on November 8 that even after January 1 people have time till March 31 to deposit with RBI. Technically the ordinance can&#39;t be issued with effect from January 1 because if they say that holding the currency is illegal after January 1, then those who would have planned to deposit it with the RBI (after December 30) will not have that window (given by the government earlier),&quot; said a source.

The second issue was shortage of liquidity in the economy; &quot;even today, the country is largely running on Rs 2,000 note. Other denomination notes have not yet been made available and the process of contracting for new currency notes has just started. The problem is not going to vanish from first week of January,&quot; he said.

According to the source, tenders for printing of new currency notes of Rs 500 and Rs 2,000 were issued from December 22. &quot;The government can&#39;t just call anybody and ask them to do it. They have to buy the paper, the ink, open tender, and then do it,&quot; he said.

Also, the government does not want to take any unpopular decision. &quot;With the after-effects of demonetisation still lingering, it does not want to become more unpopular, saying on one hand that holding old money is illegal and you can be penalised, while on the other it still cannot meet the currency demand,&quot; he said.

(This article first appeared in DNA)

At the moment, people are allowed to withdraw a maximum of Rs 2,500 a day from ATMs, Rs 24,000 a week from banks

By Praveena Sharma As Indian Prime Minister Narendra Modi gets ready to address the nation on December 30, a reliable source told DNA that the government was seriously considering relaxing current restrictions on withdrawals from ATMs and banks from Rs 2,500 a day and Rs 24,000 a week respectively to Rs 4,000 per day and Rs 40,000 per week respectively. Modi had sought 50 days to normalise the liquidity situation after he made Rs 500 and Rs 1,000 notes illegal from midnight of November 8. All of this is expected to be announced by the PM on December 30 evening. He is planning an address (to the nation) at 8 pm in which he is going to connect what he said on November 8 and ask countrymen to be patient × A source in the government, who spoke on condition of anonymity, said since the shortage of cash continued to persist, the restriction on withdrawal may not be completely removed but would be eased. "Today, for instance, the restriction is Rs 24,000 per week and Rs 2,500 per day; they might increase that to Rs 4,000 per day and Rs 40,000 per week, but nevertheless, will continue with the restrictions. All of this is expected to be announced by the PM on December 30 evening. He is planning an address (to the nation) at 8 pm in which he is going to connect what he said on November 8 and ask countrymen to be patient," he said. Also, the Indian government is contemplating an ordinance to restrict holding of banned notes and penalising their possession of beyond a certain limit after December 30. However, the ordinance is likely to be issued only after the liquidity situation improves. "That (ordinance) is being discussed very seriously, but there are two specific challenges. One is that in terms of the RBI (Reserve Bank of India) notification issued on November 8 that even after January 1 people have time till March 31 to deposit with RBI. Technically the ordinance can't be issued with effect from January 1 because if they say that holding the currency is illegal after January 1, then those who would have planned to deposit it with the RBI (after December 30) will not have that window (given by the government earlier)," said a source. The second issue was shortage of liquidity in the economy; "even today, the country is largely running on Rs 2,000 note. Other denomination notes have not yet been made available and the process of contracting for new currency notes has just started. The problem is not going to vanish from first week of January," he said. According to the source, tenders for printing of new currency notes of Rs 500 and Rs 2,000 were issued from December 22. "The government can't just call anybody and ask them to do it. They have to buy the paper, the ink, open tender, and then do it," he said. Also, the government does not want to take any unpopular decision. "With the after-effects of demonetisation still lingering, it does not want to become more unpopular, saying on one hand that holding old money is illegal and you can be penalised, while on the other it still cannot meet the currency demand," he said. (This article first appeared in DNA)

Demonetisation: Withdrawal caps may be upped to Rs 4,000 a day, 40,000 a week

banks

Banks, News on Banks, stories on Banks, articles on Banks, Banks stories at Wion, Banks news, Banks latest news