1. FARM LOAN WAIVER PROMISE CAUSES 24% RISE IN MP FARM LOAN NPAs: As per the latest data available, the Non-Performing Assets (NPAs) in farm loans has doubled to 10.6% of the total advances in Madhya Pradesh. In a little over one year period ending June 2018, the NPAs in the state rose to 24%. A similar trend is seen in Rajasthan also. Farm waivers are bad news for Banks and Farmers. Anticipating relief, farmers start skipping repayments which impacts Bank finances. Banks in turn slow down their fresh lending until governments reimburse the amount thus written off, which often happens over several years.

2. NOW EXECUTIVE DIRECTORS OF NATIONALISED BANKS ELEGIBLE TO BECOME MD OF SBI: Earlier as a tradition only Deputy Managing Directors (DMDs) of State Bank of India (SBI) were made Managing Directors of SBI and other Nationalised Banks, where as other nationalised banks Executive Directors were made MDs of other Nationalised Banks but not of SBI. Now moving away from the tradition, the government has made a policy decision to select EDs of other Nationalised Banks to become MD of SBI. There are four MDs in SBI and the Chairman heads the Bank.

3. SBI MAY BUY OUT CANARA BANK’S LOAN OF Rs 400 CRORE: State Bank of India is looking to buy out Canara Bank’s Loans of about 400 crore in Ratnagiri Gas& Power Pvt Ltd (Erstwhile Dhabol Power Co). This is expected to be the first resolution under the Inter-Creditor Agreement (ICA), which is part of government’s Project Sashakt aimed at resolving bad loans. This step by SBI follows Canara Bank moving the National Company law Tribunal (NCLT) in September 2018 against Ratnagiri Gas.

4. GOVERNMENT STRIKES OFF NAMES OF 1 LAKH COMPANIES THIS YEAR: The government has struck off the names of one lakh companies from the official records in the current financial year as these companies have not been carrying out any business activities for long. Under the Act, the government can remove the names of such companies who have not been carrying out any business for two immediate preceding financial years and have also not sought dormant status. The names of 2,26,166 and 1,00,150 companies have been struck off during financial years 2016-17 and 2017-18 respectively by the Registrar of Companies after following prescribed procedures under Companies Act, 2013.

5. NON-CTS COMPLIANT CHEQUES WILL NOT BE CLEARED FROM JANUARY 1, 2019: Non-CTS ( Cheque truncation System) complied cheques will not be accepted in clearing from January 1st 2019 and the same will be returned in clearing. Cheque Truncation System of cheques was started in the year 2010 by RBI for faster clearance of cheques. Cheque Truncation means stopping of the flow of physical cheques issued by a drawer to the drawee branch.

6. TO PREVENT BAD LOANS, BANKS TO CROSS CHECK ADDITIONAL INFORMATION ON BORROWERS: Bankers will soon seek authorisation from their borrowers and guarantors so that they can approach authorities such as Income Tax Department and GST departments to cross check the authenticity of the information submitted by the borrowers for getting loans. The proposed move is aimed at strengthening the loan sanction mechanism. This move has been planned in the backdrop of the recent pile-up of bad loans in the entire banking system. The authorisation from borrowers and guarantors is like a consent given to the bankers so that they can approach these authorities to seek the information.

7. BANK OF BARODA TO LAUNCH NEW DIGITAL INTERFACE: Bank of Baroda is building a new digital interface for faster and more efficient disbursement of retail loans and the digital format will be launched by the bank next year. The bank has been improving its impetus on deploying technical solutions for business enhancement and increasing their digital footprint.