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☕ 27.07.2020: Today's Banking / Financial News at a Glance
🍒 RBI may go in for further 25 bps rate cut: Experts : The Reserve Bank is likely to go in for a minimum 25 basis points cut in key lending rate in the forthcoming monetary policy review as the need to revive the coronavirus-hit economy is pressing notwithstanding marginal uptick in inflation, feel experts. The Monetary Policy Committee (MPC), headed by RBI Governor, is scheduled to meet for three days beginning August 4 and announce its decision on August 6. The central bank has been taking steps proactively to limit the damage to the economy caused by the outbreak of COVID-19 pandemic and subsequent lockdowns to prevent the spread of the disease. A fast-changing macroeconomic environment and deteriorating outlook for growth necessitated off-cycle meetings of the MPC – first in March and then again in May 2020. The MPC cumulatively cut the policy repo rate by 115 basis points over these two meetings. Higher prices of food items especially meat, fish, cereals and pulses pushed the retail inflation based on Consumer Price Index (CPI) to 6.09 per cent in June. The government has tasked the RBI to keep inflation at 4 per cent (+, - 2 per cent). The central bank mainly factors in CPI while arriving at its monetary policy. "We anticipate a further asymmetric cut of 25 basis points in the Repo Rate and 35 basis points in the Reverse Repo Rate, in a split decision from the MPC,” opined Aditi Nayar, Principal Economist, ICRA. Expressing similar views, Union Bank of India managing director and CEO Rajkiran Rai said, “There is a possibility of a 25 basis points cut or they may hold on (the rate).” - Moneycontrol.com
🍒 Govt amends certain Indian Accounting Standards : The government has amended certain Indian Accounting Standards (Ind-AS), including the standard relating to leases amid the coronavirus pandemic. Ind-AS 103, 116 and some other standards have been amended by the Corporate Affairs Ministry. While Ind-AS 103 pertains to business combinations, Ind-AS 116 relates to principles for recognition, presentation and disclosure of leases. In the wake of the pandemic, many lessors have extended rent concessions to lessees. However, applying the Ind-AS 116 requirements for changes to lease payments could have posed practical difficulties in the current situation. Against this backdrop, the ministry has amended the rules whereby entities would get relief from lease modification accounting due to COVID-19 related rent concessions. The amendments can be followed by lessees for annual reporting periods beginning on or after April 1, 2020. Leading consultancy EY India’s Partner and National Leader (Financial Accounting Advisory Services) Sandip Khetan said the amendment was keenly awaited by Indian companies who were gearing up for their quarterly results. - financial express
🍒 ICICI Bank Q1 net profit up 36% with gains from stake sales in insurance arms : Private sector lender ICICI Bank reported a robust 36.22 per cent increase in its standalone net profit to Rs 2,599.15 crore for the first quarter of the fiscal, buoyed by stake sales in its insurance arms. The bank’s net profit was Rs 1,908.03 crore a year ago. The bank’s total income rose by 21.77 per cent to Rs 26,066.95 crore in the quarter ended June 30, 2020 versus Rs 21,405.50 crore a year ago. Net interest income increased by 20 per cent to Rs 9,280 crore from Rs 7,737 crore during the period under review. The net interest margin was 3.69 per cent in the first quarter of 2020-21 compared to 3.87 per cent in the quarter ended March 31, 2020 and 3.61 per cent in the first quarter of 2019-20. “This reflected higher liquidity with the bank due to strong deposit inflows and limited credit demand due to the lockdown,” ICICI Bank said in a statement on Saturday. Other income shot up by 79.3 per cent to Rs 6,142.6 crore in the April to June 2020 quarter, as against Rs 3,425.44 crore a year ago.Treasury income was Rs 3,763 crore, compared to Rs 179 crore a year ago. “During the first quarter this fiscal, the bank sold four per cent shareholding in ICICI Lombard General Insurance and 1.5 per cent shareholding in ICICI Prudential Life Insurance. The aggregate gains from these transactions were Rs 3,036 crore, further strengthening the balance sheet,” the lender said. - Business Line
🍒 ICICI Bank Q1: Sharp rise in Covid provisions lends comfort, but asset quality risk persists : For ICICI Bank that has been weighed down by asset quality woes in recent years, the steep rise in Covid related provisions in the June quarter and a steady addition to the bank’s BB and below rated loan book, indicates huge uncertainty around its asset quality and earnings in the coming quarters. Much like its peers, the bank made substantial Covid-related provisions in the March quarter. The spike in such provisions in the June quarter (unlike the trend seen in peers such as HDFC Bank and Axis Bank), though prudent, hints at likely more pain on the bank’s bad loan front. ICICI Bank made an additional provisioning to the tune of Rs 5,550 crore in the latest June quarter (after the sizeable Rs 2,725 crore in the March quarter), to cushion the impact of Covid-19. But despite the sharp rise in provisions, the bank managed to deliver 36 per cent growth in profit after tax in the June quarter, thanks to Rs 3,036 crore of profit on sale of some stake in its insurance subsidiaries --- ICICI Lombard General Insurance and ICICI Prudential Life Insurance. Lower tax also aided earnings. - Business Line
🍒 Cabinet secy-led panel to select candidate for RBI deputy governor post on Aug 7 : A search panel headed by the cabinet secretary is scheduled to interview shortlisted candidates on August 7 for the post of RBI deputy governor, sources said. As per the earlier schedule, the interview was to take place on July 23 but was deferred due to some reasons. The post had fallen vacant after senior-most deputy governor N S Vishwanathan demitted office three months ahead of his extended tenure on March 31 on health grounds after serving the monetary authority for 39 years.The Financial Sector Regulatory Appointment Search Committee (FSRASC) has a list of eight names who would be interviewed via video conference, the sources said.The selected name from the interview will be sent to the Appointments Committee of the Cabinet headed by the Prime Minister for final approval, they added.Besides the cabinet secretary, other members of FSRASC include the RBI Governor, financial services secretary and two independent members. This vacancy of RBI deputy governor has been reserved for the central bank's internal candidate, who would look after the key supervisory and regulatory functions at the Mint Road. - economic times
🍒 PNB Housing Finance expects to disburse Rs 13,000 crore loan this fiscal: MD and CEO Neeraj Vyas : PNB Housing Finance hopes to disburse around Rs 13,000 crore loan in current fiscal, and expects demand to pick up around October-November with the onset of festive season, its MD and CEO Neeraj Vyas said. Demand from mass housing statement has started picking up post relaxations in coronavirus-induced lockdowns and gradual reopening of economy, he said. "Demand in a particular segment (mass housing) is picking up, which generally in the market is called green shoots (of revival). We were expecting that we would be touching sometime in September disbursements of Rs 500 crore, but we have already crossed that mark," Vyas told in an interview.PNB Housing Finance, promoted by Punjab National Bank, disbursed loans of about Rs 694 crore (Rs 674 crore retail loan and Rs 20 crore corporate loan) in the first quarter ended June of 2020-21 as against Rs 7,634 crore in the year-ago quarter. Disbursement was lower in June quarter this year because of disruption cause by the coronavirus pandemic. Vyas said the company hopes to disburse about Rs 1,200-1,500 crore per month October onwards, and further increase it to about Rs 2,000 crore per month by January. "I expect that by October-November, when festival demand picks-up, we will be able to disburse this (much)...October onwards we would be disbursing roughly around Rs 1,200-1,500 crore loan per month. And finally we have planned that by January we will be disbursing Rs 2,000 crore loan (per month). So we have planned that for the entire year we would be doing Rs 13,000 crore disbursements," Vyas said. - economic times
🍒 Pandemic hits corporates’ debt paring exercise in H2 2019-20: RBI : Economic stress created by the pandemic has stalled the deleveraging activities by the private corporate sector during the second half of 2019-20. According to the Reserve Bank of India’s Financial Stability Report, leverage ratios — measured by the debt-to-asset ratio — increased due to higher borrowings. “Incremental borrowings were used towards creating financial assets (loans and advances to subsidiary/ other companies and financial investments) and not for capex formation, as demand conditions remained muted,” the RBI said. An analysis of a sample of 3,760 listed non-financial firms (68 PSU and 3,692 non-PSU) during 2015-2019 shows that non-PSU companies deleveraged substantively relative to public sector undertakings. Notwithstanding this improvement in debt profiles, stagnant operating profit-to-sales ratios during the period reflect the challenging business environment. The ratio of interest expenses to operating profits for PSUs was lower compared to non-PSUs. - BusinessLine
🍒 Banks, businesses debate decriminalising dishonouring of cheques : A recent note by the ministry of finance seeking views from different stakeholders on whether dishonouring of a cheque should be de-criminalised has led to a raging debate. Bankers and lenders are expectedly opposed to the idea, fearing loss of deterrence, and diminishing sanctity and credibility of cheques as an instrument of transactions. A large section of the business community considers the criminal liabilities and penalties associated with dishonouring of a cheque more as an instrument of harassment by lenders. The government over the years has been sympathetic to the idea of de-criminalising cheque-dishonour offence, more so in recent months as part of the move to facilitate ease of doing business. Incidentally, the justice delivery system continues to remain clogged with ever-increasing cases relating to cheque bounce —even 32 years after making it a criminal offence. Legal experts, however, argue that just de-criminalising dishonour of a cheque — and making it civil offence — may not ease the load on the judiciary. It may just amount to transferring the load of pendency of cases from one arm of the judiciary to another. Any move to de-criminalise cheque bounce has to be followed up with massive revamping of the civil court structure. Any salubrious effect on ease of doing business, they fear, may get lost without commensurate reforms in civil courts. - Business Standard
🍒 Aditya Puri sells 7.42 million shares in HDFC Bank for Rs 843 cr : Private sector lender HDFC Bank’s Managing Director (MD) Aditya Puri has sold 95 per cent of his shareholding in the bank valued at Rs 842.7 crore. Puri held 0.14 per cent stake (or about 7.8 million shares in the bank), of which he has sold 7.42 million shares between July 21 and July 23. Puri has been the longest serving MD of a private bank in India. Puri has been at the helm of HDFC Bank for the past 26 years, since its inception in 1994. Puri will hang up his boots this October as he will reach the maximum age limit of 70 for a chief executive officer (CEO) of a private bank. He took home an annual salary of Rs18.92 crore in 2019-20, which was 38 per cent higher than in the previous year, and emerged the highest paid banker among the top private lenders. Puri exercised stock options of Rs 161.56 crore during the year, according to the bank’s 2019-20 annual report. “The shares were allotted to Puri at different times, at different price points (not at par). Acquisition cost and tax has to be accounted for as well. The net amount, therefore, will be much less,” said the spokesperson of HDFC Bank. - Business Standard
🍒 Numberless cards: No visible number or code on card enhances user security : Recently, India saw its first numberless card being launched. FamPay, a mobile bank for teenagers that provides cashless transaction options, introduced FamCard. It is like a debit card, but one that teenagers can use to make payments independently, relieving parents of the trouble of giving them hard cash or their own debit or credit cards. With FamCard, minors can make online, as well as offline payments without having to set up a bank account. All transactions done through it are protected. Essential details are stored in the FamCard app on a user’s phone. The card, if misplaced or stolen, can be easily deactivated using this app.
🍒There are several other companies which are also moving to the world of numberless cards, incorporating tech with finance. Grab, south-east Asia’s leading ride-hailing, food delivery and cashless payment solutions app, launched Asia’s first numberless card last year. The GrabPay Card aims to aid financial inclusion of millions of people in the underbanked and unbanked categories living in south-east Asia. Card details are stored in the GrabPay app, limiting security risks. Developed in partnership with MasterCard, the GrabPay Card also enables consumers to earn GrabRewards, as cardholders earn rewards points on purchases made using the card. It comes with the feature of an in-app card lock function as well that is PIN-protected, allowing users to instantly suspend payments in case they lose the card. Tech giant Apple, too, has its own numberless credit card, which is part of its Apple Pay services. The card aids shoppers in making purchases through their Apple phone or watch. It uses Touch ID to reduce fraud. While there is no visible number on the card, it is stored in the digital wallet associated with the card on a user’s phone. Following Apple’s footsteps, Curve, a credit card and app business, also came out with its new numberless card in April this year. The number of the card is stored inside the software and can be accessed by customers through the Curve app. The card works in all countries that accept MasterCard and features contactless, chip, PIN and magstripe processing - financial express
🍒 Debt MFs see Rs 1.1 lakh crore inflow in June quarter on investment in liquid schemes : Driven by investments in liquid schemes as also banking and PSU funds, debt mutual funds saw an inflow of Rs 1.1 lakh crore in three months ended June 2020 after witnessing massive redemptions in the preceding quarter. Most individual categories that invest in fixed-income securities, or debt funds, saw inflows. However, credit risk, overnight, ultra-short duration, medium duration and dynamic bond funds saw withdrawals.The positive inflow pushed the asset base of debt mutual funds to Rs 11.63 lakh crore at June-end from Rs 11.5 lakh crore at the end of March, according to data with Association of Mutual Funds on India (Amfi). As per the data, inflows into debt mutual funds were at Rs 1.1 lakh crore in the three months ended June, compared to outflows of Rs 1.13 lakh crore in the January-March quarter. Investment into such funds was at Rs 19,690 crore during the quarter ended June 2019. Nearly 80 per cent of the total inflows during the quarter under review in the fixed-income segment came through liquid funds, where most of the institutional money is parked. - moneycontrol.com
🍒 FPIs withdraw Rs 86 crore from Indian market in July so far : Foreign portfolio investors (FPIs) remained net sellers in Indian markets in July so far on account of both domestic and global factors, including rising number of coronavirus cases and increasing tension between the US and China. According to the depositories data, overseas investors invested Rs 2,336 crore in equities but pulled out Rs 2,422 crore from the debt segment, leading to net outflows of Rs 86 crore from Indian markets between July 1-24.In the previous month, FPIs were net buyers to the tune of Rs 24,053 crore. Himanshu Srivastava, associate director - manager research, Morningstar India said that FPIs have adopted a "cautious stance" with respect to investment in Indian markets. There is a surge in coronavirus cases globally, tension is increasing between the US and China, and Indian economy is still limping. "These may act as a deterrent for foreign investors," he said. However, he noted that a high quantum was invested by FPIs in equities during the last week. Harsh Jain, co-founder and COO at Groww noted that FPIs are investing majorly in the insurance and IT sector. "Pharma and consumer durables are also gaining popularity," he added. The IT sector has posted good numbers and most of the companies have performed more or less in line with the expectations, he noted. This might add to the sector's appeal. - moneycontrol.com
🍒 BPCL offers voluntary retirement scheme to employees ahead of privatisation : State-owned BPCL has brought a voluntary retirement scheme for its employees ahead of the government privatising the country's third biggest oil refiner and second-largest fuel retailer. "The Corporation has decided to offer a Voluntary Retirement Scheme (VRS), with a view to enable employees, who are not in a position to continue in service of the Corporation due to various personal reasons, to request for grant of voluntary retirement from the services of the Corporation," Bharat Petroleum Corp Ltd (BPCL) said in an internal notice to its employees.The 'Bharat Petroleum Voluntary Retirement Scheme - 2020 (BPVRS-2020)' opened on July 23 and will close on August 13.A senior company official said the VRS has been brought to offer an exit option for any employee or officer who does not want to work under a private management. "Some employees feel their role, position or place of posting may change once BPCL is privatised. So this scheme offers them an exit option," he said. - economic times.
… Have a Good day..
☕ 27.07.2020: Today's Banking / Financial News at a Glance
🍒 RBI may go in for further 25 bps rate cut: Experts : The Reserve Bank is likely to go in for a minimum 25 basis points cut in key lending rate in the forthcoming monetary policy review as the need to revive the coronavirus-hit economy is pressing notwithstanding marginal uptick in inflation, feel experts. The Monetary Policy Committee (MPC), headed by RBI Governor, is scheduled to meet for three days beginning August 4 and announce its decision on August 6. The central bank has been taking steps proactively to limit the damage to the economy caused by the outbreak of COVID-19 pandemic and subsequent lockdowns to prevent the spread of the disease. A fast-changing macroeconomic environment and deteriorating outlook for growth necessitated off-cycle meetings of the MPC – first in March and then again in May 2020. The MPC cumulatively cut the policy repo rate by 115 basis points over these two meetings. Higher prices of food items especially meat, fish, cereals and pulses pushed the retail inflation based on Consumer Price Index (CPI) to 6.09 per cent in June. The government has tasked the RBI to keep inflation at 4 per cent (+, - 2 per cent). The central bank mainly factors in CPI while arriving at its monetary policy. "We anticipate a further asymmetric cut of 25 basis points in the Repo Rate and 35 basis points in the Reverse Repo Rate, in a split decision from the MPC,” opined Aditi Nayar, Principal Economist, ICRA. Expressing similar views, Union Bank of India managing director and CEO Rajkiran Rai said, “There is a possibility of a 25 basis points cut or they may hold on (the rate).” - Moneycontrol.com
🍒 Govt amends certain Indian Accounting Standards : The government has amended certain Indian Accounting Standards (Ind-AS), including the standard relating to leases amid the coronavirus pandemic. Ind-AS 103, 116 and some other standards have been amended by the Corporate Affairs Ministry. While Ind-AS 103 pertains to business combinations, Ind-AS 116 relates to principles for recognition, presentation and disclosure of leases. In the wake of the pandemic, many lessors have extended rent concessions to lessees. However, applying the Ind-AS 116 requirements for changes to lease payments could have posed practical difficulties in the current situation. Against this backdrop, the ministry has amended the rules whereby entities would get relief from lease modification accounting due to COVID-19 related rent concessions. The amendments can be followed by lessees for annual reporting periods beginning on or after April 1, 2020. Leading consultancy EY India’s Partner and National Leader (Financial Accounting Advisory Services) Sandip Khetan said the amendment was keenly awaited by Indian companies who were gearing up for their quarterly results. - financial express
🍒 ICICI Bank Q1 net profit up 36% with gains from stake sales in insurance arms : Private sector lender ICICI Bank reported a robust 36.22 per cent increase in its standalone net profit to Rs 2,599.15 crore for the first quarter of the fiscal, buoyed by stake sales in its insurance arms. The bank’s net profit was Rs 1,908.03 crore a year ago. The bank’s total income rose by 21.77 per cent to Rs 26,066.95 crore in the quarter ended June 30, 2020 versus Rs 21,405.50 crore a year ago. Net interest income increased by 20 per cent to Rs 9,280 crore from Rs 7,737 crore during the period under review. The net interest margin was 3.69 per cent in the first quarter of 2020-21 compared to 3.87 per cent in the quarter ended March 31, 2020 and 3.61 per cent in the first quarter of 2019-20. “This reflected higher liquidity with the bank due to strong deposit inflows and limited credit demand due to the lockdown,” ICICI Bank said in a statement on Saturday. Other income shot up by 79.3 per cent to Rs 6,142.6 crore in the April to June 2020 quarter, as against Rs 3,425.44 crore a year ago.Treasury income was Rs 3,763 crore, compared to Rs 179 crore a year ago. “During the first quarter this fiscal, the bank sold four per cent shareholding in ICICI Lombard General Insurance and 1.5 per cent shareholding in ICICI Prudential Life Insurance. The aggregate gains from these transactions were Rs 3,036 crore, further strengthening the balance sheet,” the lender said. - Business Line
🍒 ICICI Bank Q1: Sharp rise in Covid provisions lends comfort, but asset quality risk persists : For ICICI Bank that has been weighed down by asset quality woes in recent years, the steep rise in Covid related provisions in the June quarter and a steady addition to the bank’s BB and below rated loan book, indicates huge uncertainty around its asset quality and earnings in the coming quarters. Much like its peers, the bank made substantial Covid-related provisions in the March quarter. The spike in such provisions in the June quarter (unlike the trend seen in peers such as HDFC Bank and Axis Bank), though prudent, hints at likely more pain on the bank’s bad loan front. ICICI Bank made an additional provisioning to the tune of Rs 5,550 crore in the latest June quarter (after the sizeable Rs 2,725 crore in the March quarter), to cushion the impact of Covid-19. But despite the sharp rise in provisions, the bank managed to deliver 36 per cent growth in profit after tax in the June quarter, thanks to Rs 3,036 crore of profit on sale of some stake in its insurance subsidiaries --- ICICI Lombard General Insurance and ICICI Prudential Life Insurance. Lower tax also aided earnings. - Business Line
🍒 Cabinet secy-led panel to select candidate for RBI deputy governor post on Aug 7 : A search panel headed by the cabinet secretary is scheduled to interview shortlisted candidates on August 7 for the post of RBI deputy governor, sources said. As per the earlier schedule, the interview was to take place on July 23 but was deferred due to some reasons. The post had fallen vacant after senior-most deputy governor N S Vishwanathan demitted office three months ahead of his extended tenure on March 31 on health grounds after serving the monetary authority for 39 years.The Financial Sector Regulatory Appointment Search Committee (FSRASC) has a list of eight names who would be interviewed via video conference, the sources said.The selected name from the interview will be sent to the Appointments Committee of the Cabinet headed by the Prime Minister for final approval, they added.Besides the cabinet secretary, other members of FSRASC include the RBI Governor, financial services secretary and two independent members. This vacancy of RBI deputy governor has been reserved for the central bank's internal candidate, who would look after the key supervisory and regulatory functions at the Mint Road. - economic times
🍒 PNB Housing Finance expects to disburse Rs 13,000 crore loan this fiscal: MD and CEO Neeraj Vyas : PNB Housing Finance hopes to disburse around Rs 13,000 crore loan in current fiscal, and expects demand to pick up around October-November with the onset of festive season, its MD and CEO Neeraj Vyas said. Demand from mass housing statement has started picking up post relaxations in coronavirus-induced lockdowns and gradual reopening of economy, he said. "Demand in a particular segment (mass housing) is picking up, which generally in the market is called green shoots (of revival). We were expecting that we would be touching sometime in September disbursements of Rs 500 crore, but we have already crossed that mark," Vyas told in an interview.PNB Housing Finance, promoted by Punjab National Bank, disbursed loans of about Rs 694 crore (Rs 674 crore retail loan and Rs 20 crore corporate loan) in the first quarter ended June of 2020-21 as against Rs 7,634 crore in the year-ago quarter. Disbursement was lower in June quarter this year because of disruption cause by the coronavirus pandemic. Vyas said the company hopes to disburse about Rs 1,200-1,500 crore per month October onwards, and further increase it to about Rs 2,000 crore per month by January. "I expect that by October-November, when festival demand picks-up, we will be able to disburse this (much)...October onwards we would be disbursing roughly around Rs 1,200-1,500 crore loan per month. And finally we have planned that by January we will be disbursing Rs 2,000 crore loan (per month). So we have planned that for the entire year we would be doing Rs 13,000 crore disbursements," Vyas said. - economic times
🍒 Pandemic hits corporates’ debt paring exercise in H2 2019-20: RBI : Economic stress created by the pandemic has stalled the deleveraging activities by the private corporate sector during the second half of 2019-20. According to the Reserve Bank of India’s Financial Stability Report, leverage ratios — measured by the debt-to-asset ratio — increased due to higher borrowings. “Incremental borrowings were used towards creating financial assets (loans and advances to subsidiary/ other companies and financial investments) and not for capex formation, as demand conditions remained muted,” the RBI said. An analysis of a sample of 3,760 listed non-financial firms (68 PSU and 3,692 non-PSU) during 2015-2019 shows that non-PSU companies deleveraged substantively relative to public sector undertakings. Notwithstanding this improvement in debt profiles, stagnant operating profit-to-sales ratios during the period reflect the challenging business environment. The ratio of interest expenses to operating profits for PSUs was lower compared to non-PSUs. - BusinessLine
🍒 Banks, businesses debate decriminalising dishonouring of cheques : A recent note by the ministry of finance seeking views from different stakeholders on whether dishonouring of a cheque should be de-criminalised has led to a raging debate. Bankers and lenders are expectedly opposed to the idea, fearing loss of deterrence, and diminishing sanctity and credibility of cheques as an instrument of transactions. A large section of the business community considers the criminal liabilities and penalties associated with dishonouring of a cheque more as an instrument of harassment by lenders. The government over the years has been sympathetic to the idea of de-criminalising cheque-dishonour offence, more so in recent months as part of the move to facilitate ease of doing business. Incidentally, the justice delivery system continues to remain clogged with ever-increasing cases relating to cheque bounce —even 32 years after making it a criminal offence. Legal experts, however, argue that just de-criminalising dishonour of a cheque — and making it civil offence — may not ease the load on the judiciary. It may just amount to transferring the load of pendency of cases from one arm of the judiciary to another. Any move to de-criminalise cheque bounce has to be followed up with massive revamping of the civil court structure. Any salubrious effect on ease of doing business, they fear, may get lost without commensurate reforms in civil courts. - Business Standard
🍒 Aditya Puri sells 7.42 million shares in HDFC Bank for Rs 843 cr : Private sector lender HDFC Bank’s Managing Director (MD) Aditya Puri has sold 95 per cent of his shareholding in the bank valued at Rs 842.7 crore. Puri held 0.14 per cent stake (or about 7.8 million shares in the bank), of which he has sold 7.42 million shares between July 21 and July 23. Puri has been the longest serving MD of a private bank in India. Puri has been at the helm of HDFC Bank for the past 26 years, since its inception in 1994. Puri will hang up his boots this October as he will reach the maximum age limit of 70 for a chief executive officer (CEO) of a private bank. He took home an annual salary of Rs18.92 crore in 2019-20, which was 38 per cent higher than in the previous year, and emerged the highest paid banker among the top private lenders. Puri exercised stock options of Rs 161.56 crore during the year, according to the bank’s 2019-20 annual report. “The shares were allotted to Puri at different times, at different price points (not at par). Acquisition cost and tax has to be accounted for as well. The net amount, therefore, will be much less,” said the spokesperson of HDFC Bank. - Business Standard
🍒 Numberless cards: No visible number or code on card enhances user security : Recently, India saw its first numberless card being launched. FamPay, a mobile bank for teenagers that provides cashless transaction options, introduced FamCard. It is like a debit card, but one that teenagers can use to make payments independently, relieving parents of the trouble of giving them hard cash or their own debit or credit cards. With FamCard, minors can make online, as well as offline payments without having to set up a bank account. All transactions done through it are protected. Essential details are stored in the FamCard app on a user’s phone. The card, if misplaced or stolen, can be easily deactivated using this app.
🍒There are several other companies which are also moving to the world of numberless cards, incorporating tech with finance. Grab, south-east Asia’s leading ride-hailing, food delivery and cashless payment solutions app, launched Asia’s first numberless card last year. The GrabPay Card aims to aid financial inclusion of millions of people in the underbanked and unbanked categories living in south-east Asia. Card details are stored in the GrabPay app, limiting security risks. Developed in partnership with MasterCard, the GrabPay Card also enables consumers to earn GrabRewards, as cardholders earn rewards points on purchases made using the card. It comes with the feature of an in-app card lock function as well that is PIN-protected, allowing users to instantly suspend payments in case they lose the card. Tech giant Apple, too, has its own numberless credit card, which is part of its Apple Pay services. The card aids shoppers in making purchases through their Apple phone or watch. It uses Touch ID to reduce fraud. While there is no visible number on the card, it is stored in the digital wallet associated with the card on a user’s phone. Following Apple’s footsteps, Curve, a credit card and app business, also came out with its new numberless card in April this year. The number of the card is stored inside the software and can be accessed by customers through the Curve app. The card works in all countries that accept MasterCard and features contactless, chip, PIN and magstripe processing - financial express
🍒 Debt MFs see Rs 1.1 lakh crore inflow in June quarter on investment in liquid schemes : Driven by investments in liquid schemes as also banking and PSU funds, debt mutual funds saw an inflow of Rs 1.1 lakh crore in three months ended June 2020 after witnessing massive redemptions in the preceding quarter. Most individual categories that invest in fixed-income securities, or debt funds, saw inflows. However, credit risk, overnight, ultra-short duration, medium duration and dynamic bond funds saw withdrawals.The positive inflow pushed the asset base of debt mutual funds to Rs 11.63 lakh crore at June-end from Rs 11.5 lakh crore at the end of March, according to data with Association of Mutual Funds on India (Amfi). As per the data, inflows into debt mutual funds were at Rs 1.1 lakh crore in the three months ended June, compared to outflows of Rs 1.13 lakh crore in the January-March quarter. Investment into such funds was at Rs 19,690 crore during the quarter ended June 2019. Nearly 80 per cent of the total inflows during the quarter under review in the fixed-income segment came through liquid funds, where most of the institutional money is parked. - moneycontrol.com
🍒 FPIs withdraw Rs 86 crore from Indian market in July so far : Foreign portfolio investors (FPIs) remained net sellers in Indian markets in July so far on account of both domestic and global factors, including rising number of coronavirus cases and increasing tension between the US and China. According to the depositories data, overseas investors invested Rs 2,336 crore in equities but pulled out Rs 2,422 crore from the debt segment, leading to net outflows of Rs 86 crore from Indian markets between July 1-24.In the previous month, FPIs were net buyers to the tune of Rs 24,053 crore. Himanshu Srivastava, associate director - manager research, Morningstar India said that FPIs have adopted a "cautious stance" with respect to investment in Indian markets. There is a surge in coronavirus cases globally, tension is increasing between the US and China, and Indian economy is still limping. "These may act as a deterrent for foreign investors," he said. However, he noted that a high quantum was invested by FPIs in equities during the last week. Harsh Jain, co-founder and COO at Groww noted that FPIs are investing majorly in the insurance and IT sector. "Pharma and consumer durables are also gaining popularity," he added. The IT sector has posted good numbers and most of the companies have performed more or less in line with the expectations, he noted. This might add to the sector's appeal. - moneycontrol.com
🍒 BPCL offers voluntary retirement scheme to employees ahead of privatisation : State-owned BPCL has brought a voluntary retirement scheme for its employees ahead of the government privatising the country's third biggest oil refiner and second-largest fuel retailer. "The Corporation has decided to offer a Voluntary Retirement Scheme (VRS), with a view to enable employees, who are not in a position to continue in service of the Corporation due to various personal reasons, to request for grant of voluntary retirement from the services of the Corporation," Bharat Petroleum Corp Ltd (BPCL) said in an internal notice to its employees.The 'Bharat Petroleum Voluntary Retirement Scheme - 2020 (BPVRS-2020)' opened on July 23 and will close on August 13.A senior company official said the VRS has been brought to offer an exit option for any employee or officer who does not want to work under a private management. "Some employees feel their role, position or place of posting may change once BPCL is privatised. So this scheme offers them an exit option," he said. - economic times.
… Have a Good day..
