- SBI TO WAIVE LOANS TAKEN BY MARTYRED CRPF PERSONNEL, ALSO TO RELEASE INSURANCE PAYMENTS: State Bank of India has said that it would waive all outstanding loans availed by the 23 CRPF personnel who were killed in the Pulwama terror attack. All the 44 CRPF personnel were customers of State Bank of India under Defence Salary Package where the bank provides insurance of Rs. 30 lakh to each of the defence personnel. Bank is taking steps to expedite release of insurance amount to the next of kin of the martyred soldiers.
- RBI SEEKS INFORMATION FROM NBFCs ON MORATORIUM GIVEN TO BORROWERS: Amid the recent controversy on loans against shares, Reserve Bank of India has asked Non-Banking Finance Companies (NBFCs) to disclose the moratorium (grace period for repayment) given to borrowers. Besides Mutual Funds, NBFCs are large lenders against pledge of shares. If the borrowers pledging the shares to raise money fail to bring in additional collateral when the stocks fall, lenders should sell the stock to protect their exposure. And if the shares are not sold then the credit rating agencies should downgrade the instruments issued by the borrower to raise funds. RBI may look in to the rules on loans against shares for NBFCs and banks and this would include raising the risk weightage on loans against stocks.
- GOVERNMENT TO INFUSE Rs. 48,239 CRORE IN 12 PSU BANKS: The Finance Ministry on Wednesday announced that it would pump in Rs. 48,239 Crore in 12 Public Sector banks (PSBs) in this fiscal to help them maintain regulatory capital requirements and finance growth plans. The biggest gainers in this are Corporation Bank (Rs. 9,086 crore) and Allahabad Bank (Rs. 6,896 Crore). With this funding, the total amount of capital infusion to all the PSBs would increase to Rs. 1,00,958 crore out of the planned recapitalisation of Rs. 1.06 lakh crore in the current fiscal.
- ONLY 6 BANKS CROSS DESIRABLE LEVEL OF 70% PROVISION COVERAGE RATIO: Provision Coverage Ratio (PCR) is the ratio of provisioning to gross Non-Performing Asset which indicates the extent of funds a bank has earmarked or kept aside to cover loan losses. The Public Sector Banks (PSBs) have substantially increased their Loan-loss provision and have strengthened their respective balance sheets in the first 9 months of the current fiscal but only 6 out of 21 PSBs have crossed the desirable level of 70% of PCR.
- SBI TAKES WORK-LIFE BALANCE TO A NEW HEIGHT: State Bank of India has taken a new initiative to ensure Work-Life balance of its massive employee workforce. The programme called “Nayi Disha”, focuses on work-life balance and also involves the staffs’ immediate family members, also gives them the ability to inform the bank if an employee is not able to leave work on time. The programme is evolved in such a way that its 2.6 lakh strong work force does not work mechanically and is sufficiently motivated to take on newer challenges that the future will throw up. The programme will also boost the morale of its staff which will have a positive impact on customer service. The bank has hired external hand to design the programme.
- SOON BANKS WILL TAKE BACK HEFTY PAYOUTS FROM ERRANTS CEOs: The Reserve bank of India is tightening the CEO compensation norms in the wake of instances of large Non-Performing Assets and sharp practices adopted by the top executives to dodge the regulators. RBI is working on a set of rules that would link remuneration of banks CEOs to parameters like balance sheet size of the bank, loan delinquencies, profit and governance. The proposed framework is expected to provide a broad template to the Board of Directors while approving increase in salary, performance bonus and stock options.
- GOVERNMENT PASSES UNREGULATED DEPOSIT SCHEME ORDINANCE: The President Mr Ram Nath Kovind promulgated the Banning of Unregulated Deposit Scheme Ordinance. This will help to put a check on illicit deposit-taking activities that dupe the poor and financially illiterate of their hard-earned savings. The Ordinance makes it mandatory for everyone to register before taking a deposit. This ordinance will also help create a central repository of all the registered entities that can take deposits.
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