BANKING

Union finance minister Nirmala Sitharaman has approved the creation of additional senior level posts in nationalised banks to enhance administrative efficiency. The number of Chief General Manager posts across 11 Nationalised Banks is increased from 80 to 144, with corresponding increases in other senior positions.

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Ghosh brings more than 30 years of experience across corporate and development banking, venture capital. He started his career in 1993 and spent a decade with ICICI, Reliance and Rabo India before joining Yes Bank as group president in 2004.

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India's private credit market is rapidly expanding with new local participants, raising concerns about potentially weakened lending standards. Experts highlight possible risks while regulators emphasise the sector's resilience. Despite challenges, the long-term outlook remains positive as investor interest grows.

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BANKING

Commercial banks are raising outflow rates on retail deposits as they prepare for new liquidity coverage ratio rules. These changes, effective from April 1 next year, will require more investment in high-quality liquid assets. This aims to mitigate risks of mass withdrawals, similar to the collapse of Silicon Valley Bank in the US.

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Indel Money launches its fifth public issue of secured NCDs, offering a base amount of Rs 75 crore with an option to retain oversubscription up to Rs 75 crore, totaling Rs 150 crore. The coupon yields up to 13.44% per annum. Funds will be used for lending, financing, and corporate purposes.

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BANKING

UCO Bank recovers Rs 414 crore from 26 accounts through NCLT in Q2, with Rs 393 crore resolved and Rs 21 crore under liquidation. Gross NPA ratio drops to 3.18% from 4.14% last year. Domestic advances up by 21.62% year-on-year.

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The finance ministry is considering increasing Chief General Managers in public sector banks to support business growth and profitability. Current guidelines, issued in 2019, permit one Chief General Manager for four General Managers. PSBs posted record profits, with SBI contributing over 40% of total earnings.

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BANKING

HDFC Bank plans to lower its loan-to-deposit ratio to pre-merger levels within 2-3 years. Post-merger, the ratio spiked to 110%, prompting securitization of 190 billion rupees in loans. LDR is an important metric for banks as it helps assess their liquidity position by gauging whether they have enough deposits to fund loan growth.

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Several state-owned banks, including Central Bank of India and Punjab National Bank, have waived processing fees on home loans during the festive season to boost demand. While public sector banks offer lower rates, private sector banks have not announced similar waivers.

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Kotak Mahindra Bank has announced it will acquire Standard Chartered Bank's personal loan book in India, worth Rs 4,100 crore. The deal is expected to finalize within three months. This move aligns with Kotak’s strategy to expand its market share and grow in the affluent customer segment, ensuring a smooth transition.

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BANKING

Kotak Mahindra Bank said on Friday it will buy Standard Chartered Bank's personal loan book in India, which is worth 41 billion rupees ($488 million).

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BANKING

Indian banks, including HDFC and Kotak Mahindra, are grappling with increased credit costs and challenges in attracting customer deposits as people shift towards equity funds. HDFC aims to improve its high loan-deposit ratio, while Kotak Mahindra faces restrictions impacting its profitability.

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The Reserve Bank of India has banned four finance companies, including Navi Finserv and DMI Finance, from issuing new loans due to excessive interest rates. This follows warnings about aggressive growth practices. The companies must submit remedial actions to the RBI for review to resume their loan services.

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BANKING

The Reserve Bank of India has directed Asirvad Micro Finance Limited, Arohan Financial Services Limited, DMI Finance Private Limited, and Navi Finserv Limited to halt loan sanction and disbursement starting October 21, 2024, due to concerns over their excessive interest rates and non-compliance with established financial regulations.

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Axis Bank became the fourth largest credit card issuer in Q2 FY25, with a 14% increase in Cards in Force. Credit card transactions surged, especially in lifestyle, fashion, and electronics. However, millennial defaults are rising, with outstanding debt reaching substantial highs.

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Multiples appoints Rahul Chawla, a senior executive from Deutsche Bank, as the managing director for credit strategy. Chawla, with nearly three decades of experience and extensive expertise in structured finance, is set to lead Multiples' new venture into the credit investing space.

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National Payments Corporation of India (NPCI) has teamed up with The Times of India to launch a national campaign on digital payment safety. Using the iconic cartoon character Common Man, the campaign aims to educate users about different types of digital payment frauds and provide tips for secure transactions, especially focusing on UPI payments.

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The Indian payments industry is projected to grow to $49 trillion in value by 2028 from $30 trillion in 2023, with transaction volumes expected to increase to 434 billion. Revenue growth in this sector is forecasted at 11%, with credit cards and fund transfers leading the expansion.

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Capital India Finance Ltd has sold its housing finance subsidiary, Capital India Home Loans Limited, to Weaver Services Private Limited for Rs 267 crore. Weaver will raise up to Rs 800 crore from private equity funds to finance this acquisition. The focus will be on innovative home loan products for self-employed individuals in Tier 2 and Tier 3 towns.

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Kotak Mahindra Bank, aiming to be India’s third largest private sector lender by 2030, faces significant M&A risks and integration challenges, Bernstein Research a part of the Société Générale group has said. A 7% profit growth over Axis Bank appears elusive organically, prompting potential inorganic growth through acquisitions like IDBI Bank or smaller banks.

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Biz2X, a subsidiary of Biz2Credit, has surpassed Rs 9,000 crore in loan disbursements, driven by its AI-integrated platform, DigiKred. The company expects to facilitate an additional Rs 5,000 crore by FY2025. Strategic collaborations and expansions into UAE and Saudi Arabia bolster their growth.

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Acko appoints founding member Sandip Goenka as CEO of its new life insurance business. Goenka, with over two decades of experience, will develop product offerings and ensure long-term growth, operational efficiency, and financial performance. His leadership signals Acko's commitment to expanding their life insurance sector presence.

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National Insurance Company faces an ₹8,000 crore solvency shortfall, with a negative 0.49% solvency margin against the regulatory minimum of 1.5%. The insurer plans to address the gap by liquidating key assets, including stakes in Agriculture Insurance Company and India International Insurance Singapore, pending necessary approvals.

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During this year's festive season sales, there was a significant rise in the usage of credit cards and credit-based payment instruments such as pay-later products, with a recorded increase of 35-50% in transactions compared to the previous year, particularly in lifestyle, fashion, and electronics.

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Hospitals in India introduce additional charges, such as disinfection fees and peak operation theatre charges, leading to a 20% rise in medical costs. Insurers struggle as previously bundled services are unbundled, causing unpredictability in healthcare expenses and potential increases in insurance premiums.

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Wealthy Indians are uncertain about investments abroad after a directive from the International Financial Services Centres Authority. It restricts fixed deposit terms in GIFT City to under 180 days, conflicting with Reserve Bank of India guidelines. This confusion affects funding to offshore banks and the liberalised remittance scheme for high-net-worth individuals.

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Indian Overseas Bank has inaugurated 15 Retail Loan Processing Centres, both physically and virtually, across various cities including Chennai and Bengaluru to enhance loan approval efficiency. These centres are equipped with advanced digital tools for quicker turnaround and improved risk management, supporting the bank's retail growth strategy.

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SBI plans to increase the threshold of the instant loan scheme for MSMEs from Rs 5 crore. SBI aims to simplify MSME credit by leveraging digital tools and reducing the need for collateral. Additionally, SBI intends to open 600 new branches this financial year, enhancing its extensive network.

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Housing finance companies are anticipating a delay in the festive season demand surge due to pending government guidelines on the PMAY and Affordable Housing Refinance Scheme. The PMAY subsidy aims to provide ₹1.80 lakh for home loans up to ₹25 lakh, while the refinance scheme offers a 5% interest rate for housing loans disbursed in the past year.

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The RBI has instructed all banks and non-bank payment system providers to review and modify their digital payment systems for better accessibility to disabled persons. PSPs must refer to the Ministry of Finance’s Accessibility Standards and ensure security is not compromised. Details of changes must be reported to RBI within a month.

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Reliance's JioFinance App, launched on May 30, 2024, now offers diverse financial products including loans and digital savings accounts. Over six million users have provided feedback, enhancing the app's user experience. The JioFinance app also includes seamless UPI payments and insurance plans, aiming to democratize financial services in India.

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Irdai is intensifying scrutiny of cybersecurity lapses in the insurance sector following a major data breach at Star Health Insurance. Over 31 million customers' data was compromised. The regulator has mandated an extensive audit of Star Health's cybersecurity framework. The audit aims to identify control gaps and recommend measures to prevent future breaches.

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Banks raise alarms over fraudulent entities impersonating them in text messages to dupe customers. They seek intervention from the finance ministry, TRAI, and telecom service providers, and plan to approach the RBI to address compliance challenges with cybersecurity advisories.

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BANKING

The Reserve Bank of India has directed banks, NBFCs, and other entities to utilize all relevant information sources for risk assessments. This measure aims to mitigate money laundering, terrorist financing, and proliferation financing risks. It highlights the importance of an enterprise-level risk assessment and advises against a siloed approach to ensure effective risk management.

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BANKING

India's UPI transaction volume surged 52% year-on-year to 78.97 billion in H1 2024, with the transaction value rising by 40%. PhonePe led as the top UPI app. Average ticket size dropped by 8%, despite substantial growth in use for micro-transactions in sectors such as e-commerce and government services.

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BANKING

India's largest health insurer, Star Health, investigates a claim suggesting its CISO, Amarjeet Khanuja, may have facilitated a customer data leak involving medical records disseminated by a hacker on Telegram. Despite the allegation, no evidence implicating Khanuja has been found yet.

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The Reserve Bank of India advises non-banking financial companies, including microfinance and housing finance institutions, to prioritize compliance, adhere to fair practices, and sincerely address customer grievances. While monitoring these entities' exposures and risk practices, the RBI emphasizes the need for self-correction to avoid systemic risks, underscoring potential financial stability concerns with excessive returns and high indebtedness.

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The National Company Law Tribunal in Ahmedabad approved ICICI Bank’s plan to delist ICICI Securities Ltd. Two objections to the delisting were dismissed. Earlier, the NCLT Mumbai also approved the delisting scheme. ICICI Bank argued that the objections didn't meet the required shareholding threshold. The delisting was approved by a significant majority of ICICI Securities' shareholders.

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Zarin Daruwala, CEO of Standard Chartered India & South Asia, will retire in March after over eight years in the role. Turning 60 in February, she has significantly grown the India franchise with a focus on corporate, investment, and retail banking. Her successor's search has begun.

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BANKING

During the recent Monetary Policy Committee meeting, RBI Governor Shaktikanta Das expressed concerns about some Non-Banking Financial Companies (NBFCs) aggressively pursuing growth without proper administration. He advised them to review their target-based compensation structures and assess their exposures in unsecured loans, emphasizing the need for robust underwriting and monitoring standards.

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Mumbai-based EPS is backed by investors like the UK's Apis Partners and Dutch Entrepreneurial Development Bank FMO. The licence has made it the country's fifth white-label ATM operator alongside Tata Communications Payment Solutions, India1 Payments, Hitachi Payment and Vakrangee. The RBI had last issued this licence in 2014 to India1 Payments. Earlier, three other companies had surrendered their licences.

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BANKING

ICICI Bank and PhonePe have partnered to provide instant credit on UPI for pre-approved customers. The service offers up to Rs 2 lakh credit with a 45-day repayment period. This facility, aimed at festive shopping needs, allows users to make payments for high-value items seamlessly and securely using any UPI payment app.

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The Reserve Bank of India has rejected Religare Enterprises' attempt to appoint Rakesh Asthana to its board. This followed a complaint from the Burman family, who hold a significant stake in REL, citing procedural irregularities. The dispute has escalated to legal actions, with the Delhi High Court involved. The company's management is amid a power tussle with the Burman family.

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Public sector banks saw stronger credit growth compared to deposit growth for the September quarter. Bank of India, Union Bank of India, and Indian Bank reported credit growth between 10% to 14%, while deposit growth ranged from 8% to 10%, according to provisional numbers.

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Axis Bank and IFC have partnered to provide a USD 500 million loan aimed at developing India's blue finance market and scaling up green project financing. This marks IFC's first blue investment in India, focusing on sustainable initiatives such as water management and marine ecosystem restoration.

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The Indian government seeks insights from the private equity and venture capital sector on global tax practices for fund managers' carried interest as it examines the imposition of GST on such earnings. A recent Supreme Court decision helps facilitate ongoing discussions about aligning with international tax norms.

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Punjab CM Bhagwant Mann announced a new loan scheme from state cooperative banks for farmers to buy crop residue management machines. The scheme offers 80% subsidy to PACs and 50% subsidy to farmers on equipment purchases. It aims to reduce paddy straw burning by making rural credit more accessible.

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BANKING

Public sector banks are expected to see a slight quarterly dip in profits for Q2 FY25, with a 0.6% QoQ decline but a 17.2% YoY increase, according to Motilal Oswal. Private sector banks forecast modest growth, projecting a 12% YoY increase in Pre-Provision Operating Profit and 5% in PAT.

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BANKING

Bandhan Bank's total business grew by 24.6% in Q2 of the current financial year, reaching Rs 2,73,163 crore. Loans and advances stood at Rs 1,30,652 crore, and deposits at Rs 1,42,511 crore. The collection efficiency ratio was 98.2%. Interim MD&CEO Ratan Kumar Kesh's tenure was extended by a month from October 10.

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BANKING

J&K Bank officers from the AIJKBOF staged a day-long hunger strike against the bank management's high-handed actions and anti-employee policies. They protested the staff accountability policy, work-life imbalance, and frozen variable pay. Officers criticized the management's failure to communicate and raised concerns over the exploitation of apprentices instead of filling vacancies.

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Despite a growing startup ecosystem, only 8.2% of startups in India undergo incubation, with 10% of incubators supporting 98% of these startups. The report emphasizes the need for more incubators and improved performance, especially outside Tier I cities and in underrepresented sectors.

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Japan’s MUFG has re-entered the race to acquire a majority stake in Yes Bank after its proposal to invest in HDB Financial was rejected. MUFG has submitted a non-binding offer and is conducting due diligence, negotiating mainly with Yes Bank and SBI.

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Small finance banks and microfinance lenders are setting a cap of four live loans per borrower. This is a precautionary step to avoid defaults due to unsecured loan stress. The RBI has already raised concerns about rising delinquency levels and multiple live loans, prompting this move. Utkarsh Small Finance Bank follows this four-loan cap policy.

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ICICI Bank has partnered with MakeMyTrip to launch a premium co-branded credit card aimed at travel enthusiasts, offering rewards like myCash, complimentary MMTBLACK Gold membership, and various discounts on bookings. The card, available on Mastercard and RuPay, aims to enhance the travel experience for Indian consumers.

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The DGGI has issued over 300 show-cause notices to company officials for wrongfully availing input tax credit. Penalties up to 100% have been imposed. Notices target top management where their role in tax evasion is established. Industry argues penalties should only apply in exceptional cases. Recipients challenge the notices in court.

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Lenders in India are seeing negative impacts from extreme weather conditions, such as heatwaves, floods, and expected harsh winters, on their loan portfolios, affecting collection efficiency and sales. Financial institutions stress the need for climate-specific solutions and structural reforms to mitigate these risks.

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BANKING

Chandra Shekhar Ghosh is now the chairman and full-time executive director of Bandhan Financial Services. The decision was approved by shareholders including IFC and Sidbi. Ghosh took on this role after retiring from Bandhan Bank as managing director. Having founded the Bandhan group 24 years ago, Ghosh aims to contribute strategically to the group's growth.

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BANKING

SBI plans to open 600 branches this financial year, targeting emerging areas and large residential townships. The bank aims to improve customer reach and offers innovative products like a combo of recurring deposits and SIP. SBI also focuses on deposit mobilization through extensive outreach programs. SBI has a network of over 22,500 branches across India.

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Ajay Banga, President of the World Bank, intends to shift the institution’s focus toward being a Knowledge Bank. He is addressing issues like climate change and AI governance, emphasizing fair climate policies and bridging the AI divide in developing markets. He stresses the need for measurable outcomes in initiatives, such as improving girls’ lives through education.

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A new breed of policies now caters to adventurous and niche activities like golfing and scuba diving besides offering emergency coverage for pre-existing conditions, home-to-airport coverage, upgrading to business class due to health reasons and even pet care.

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BANKING

Kotak Mahindra Bank is heavily investing in technology to meet RBI expectations and enhance competitiveness. CEO Ashok Vaswani aims for the bank to become a top three private sector player by 2030. The bank will look at both organic and inorganic growth opportunities, focusing especially on technology and profitable growth.

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BANKING

The Reserve Bank of India has voiced concerns about small finance banks' over-reliance on high-cost term deposits and potential defaults due to inadequate credit underwriting. RBI also highlighted cyber threats, poor customer service, and high charges, stressing the need for robust underwriting to mitigate risks.

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BANKING

Deposit growth is currently outpacing credit expansion. Although a policy rate cut is expected in the second half of the fiscal year, bank deposit rates are likely to stay high for now. This is due to the slow pace of deposit mobilisation and the need for capital to fund private capital expenditure, which is on the rise.

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Credit and debit cards offering discounts on travel, experiences, and lifestyle are gaining popularity among affluent and young customers. Banks like Bank of Baroda, HDFC Bank, and HSBC are partnering with travel companies to provide exclusive offers. The trend is driven by rising demand for unique experiences and live events.

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India's smaller towns and rural areas are seeing a rise in credit-driven consumption due to increased consumer financing and new bank accounts under the Pradhan Mantri Jan Dhan Yojana. This trend is evident in the purchase of two-wheelers, electronics, and smartphones, with finance companies expanding their reach into these markets.

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The Ministry of Women and Child Development will soon launch a revamped portal under the Vatsalya Mission, integrating various child protection services. This initiative aims to streamline emergency responses and improve coordination. The national child helpline has also been integrated with emergency services, enhancing response times. Specialized institutions for children with disabilities are being supported, along with mental health training for government officers.

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BANKING

The State Bank of India (SBI) plans to introduce innovative financial products, including a mix of recurring deposits and Systematic Investment Plans (SIP), to attract more depositors. SBI's Chairman, C S Setty, emphasized the need to meet evolving customer needs and highlighted the bank's focus on balanced interest rates and superior customer service.

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Bank of America has placed two bankers in India on administrative leave amid an internal investigation following a whistleblower complaint. The complaint alleges that the bankers tipped off certain investors about upcoming secondary offerings, allowing them to profit from non-public information. The investigation focuses on a $200-million stock sale for Sun Life in March.

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Many Asian countries, including India, are moving away from older payment methods like ACH in favor of real-time systems such as UPI. JP Morgan Chase is investing in distributed ledger technology and partnering with ONDC to support this shift and enhance e-commerce and financial services.

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BANKING

HDFC Life Insurance plans to raise Rs 1,500 crore through non-convertible debentures after board approval. The NCDs will carry an 8.05% coupon rate and a 10-year term, with allotment set for October 9. This move follows a drop in the company's solvency ratio and aims to bolster financial stability.

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BANKING

Axis Bank has launched a Corporate Credit Card Suite for startups under its New Economy Group. The cards aim to streamline travel, official expenses, and vendor payments. The suite includes an executive corporate credit card for founders and a purchase reward credit card for expense management. Axis Bank also announced a partnership with the Tech Entrepreneurs Association of Mumbai.

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India is poised to become one of Citi's top three markets within 5-7 years, driven by the expansion of its services business and increasing global investments by domestic firms. Currently the fourth largest market, India shows significant growth potential in manufacturing, exports, and digital payments.

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BANKING

Banking system deposit growth has surpassed credit growth over the past 8 months, with deposits increasing by Rs. 14.7 lakh crore to Rs. 215.5 lakh crore and credit expanding by Rs. 10.9 lakh crore to Rs. 170.5 lakh crore as of September 6, 2024. Personal loans and MSME demand have supported credit growth.

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BANKING

Indian banks have shown strong asset quality metrics in the June quarter of 2024. Gross non-performing loans fell by 15.2% year-on-year to Rs 4.57 lakh crore, with the GNPA ratio reducing to 2.8%. Public sector banks led the improvement, while private sector banks saw a rise in bad loans due to a merger and seasonal factors.

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InCred Financial, backed by KKR, has appointed Gaurav Maheshwari as its new chief financial officer. Maheshwari, previously with Standard Chartered Bank and Altico Capital, brings over 27 years of experience. This move aligns with InCred's plans to strengthen its leadership team. The company offers retail, MSME, and education loans and became a unicorn in late 2023.

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BANKING

A 70-year-old retiree faces a dilemma over renewing his ₹73,000 health insurance policy or relying on the government's Ayushman Bharat scheme, which offers ₹5 lakh free coverage for seniors. There are many such cases. Rising private insurance premiums and limitations of government schemes are troubling many senior citizens across India.

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The Enforcement Directorate is investigating employee stock options issued to Religare executive chairperson Rashmi Saluja and other officials for potential illegality. The probe focuses on Esops acquired at lower prices, allegedly resulting in unlawful gains. Saluja denies the charges, asserting compliance with company policies.

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BANKING

HDFC Bank, India's largest private sector lender, may see its loan growth dip below 10% in the September quarter due to plans to sell Rs 70,000 crore of loans and the base effect from its merger with HDFC Corporation. The bank is also focusing on reducing its loan to deposit ratio and improving margins.

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BANKING

Default rates in credit cards and unsecured loans are rising, with losses in credit cards nearing 6%. Young millennials are reportedly defaulting without revolving the loan. The RBI has flagged risks in the unsecured segment and taken measures to curb growth. Asset quality concerns also persist in the MFI space.

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BANKING

In an interview with ET, Jamie Dimon, CEO of JPMorgan, emphasized that geopolitics will shape the global economy more than finance. He highlighted the resilience of the US dollar and discussed interest rate movements in the US and Japan. Dimon also addressed geopolitical risks, oil prices, and India's economic progress under PM Modi's leadership.

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BANKING

Spandana Sphoorty Financial has sold stressed loans worth Rs 304.41 crore to an asset reconstruction firm for Rs 16.74 crore. The sale, approved by the board, includes written-off loans and was conducted through an open bid method. The company's gross non-performing assets ratio rose to 2.6% as of June-end, impacting its net profit.

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BANKING

Data from TransUnion CIBIL indicates an improvement in credit culture, with the share of prime-rated borrowers rising to 55% by June 2024. However, retail credit growth has moderated as banks and NBFCs tighten credit supply. Home loans and credit cards saw significant contractions, while personal loans grew modestly.

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BANKING

REC Ltd has successfully raised $500 million through a five-year bond, priced at 4.78%, attracting global investors. This could pave the way for more Indian companies to enter the bond market. Shriram Finance is also expected to raise a similar amount soon. The transaction was managed by several international banks.

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BANKING

L&T Finance's CEO Sudipta Roy discusses the company's cautious approach amid rising delinquencies in microfinance and unsecured loans. Despite challenges, L&T Finance aims for a ₹2 lakh crore balance sheet by 2024 and focuses on diversifying liabilities and improving customer acquisition. The company has no current plans to become a bank.

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BANKING

A study by RBI economists reveals that priority sector lending (PSL) improves banks' asset quality, especially after the asset quality review. The research, covering data from March 2006 to March 2023, highlights that PSL growth does not deteriorate asset quality and emphasizes the role of PSLCs in enhancing niche sector lending.

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BANKING

The performance of NBFCs has seen improvement since 2022 after the implementation of scale-based regulations. A study by RBI economists highlights the need for vigilance in cyber-security and climate risks. Gross NPAs have declined, and profitability indicators have improved. The sector remains resilient with double-digit credit growth and adequate capital.

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BANKING

The Finance Ministry has urged banks to implement effective monitoring and oversight mechanisms for managing pending cases in Debt Recovery Tribunals (DRTs). During a meeting, best practices were discussed to optimize recovery. Banks are advised to define policies for small and high-value cases and adopt the new DRT Regulations 2024 for more efficient processes.

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BANKING

The Union Finance Ministry reports a significant surge in digital payments, reaching Rs 1,669 lakh crore in the first five months of FY 2024-25. The volume of transactions hit 8,659 crore. UPI remains central to this growth, with its transaction value rising dramatically. India's digital payment systems are also expanding globally.

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BANKING

The Reserve Bank of India has advised banks to seek legal remedies in disputes with the CBI over fraud cases. This follows the Supreme Court's ruling that borrowers must be given a hearing before being classified as fraud. Banks argue this ruling should not apply retrospectively, while the CBI seeks clarity from the Supreme Court.

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BANKING

The Reserve Bank of India has extended the tenure of IDFC First Bank's Managing Director V Vaidyanathan for another three years, effective from December 19, 2024, to December 18, 2027. The bank's board had earlier approved his re-appointment following the expiry of his current term in December 2024. Vaidyanathan has been leading the bank since December 2018.

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BANKING

Finance Minister Nirmala Sitharaman emphasised the potential of Indian banks leveraging UPI's digital footprints to expand their balance sheets. She highlighted UPI's global reach and its significant role in digital payments. Sitharaman also urged banks to adopt technology for risk mitigation, customer service, credit assessment, and fraud detection.

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BANKING

Customer data from India's largest health insurer, Star Health, has been leaked and is accessible via Telegram chatbots. The data includes sensitive information such as medical reports and personal details. Star Health has reported the breach to authorities and claims that sensitive customer data remains secure despite the incident.

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BANKING

HDFC Bank, India's largest private lender, aims to finalize a sale of loans worth over 90 billion rupees by the end of September. The bank is issuing pass through certificates backed by car loans, with provisional AAA(SO) ratings from India Ratings. The sale will help manage the bank's loan growth and deposit pressures.

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BANKING

PTCs are issued across three tranches- with series A1 having an issue size of Rs 3,500 crore and maturing in 24 months, series A2 of Rs 1,800 crore and maturing in 34 months and series A3 of Rs 3762 crore for 60 months.

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BANKING

Godrej Capital, the financial services arm of the Godrej Group, plans to enter the affordable housing loan segment and aims to grow its assets under management to Rs 17,000 crore by 2024. The company targets Rs 30,000 crore by March 2026 and Rs 50,000 crore by March 2028.

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BANKING

BNP Paribas India has opened a new dormitory for female residents at Adhar, an NGO that supports intellectually disabled adults. The facility will accommodate over 55 women and 18 staff members, enhancing Adhar's mission of providing comprehensive care. This initiative reflects BNP Paribas India's commitment to improving lives.

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BANKING

HDFC Bank is seeking fintech partnerships to develop tech solutions for loans, payments, customer service, and small business banking. This strategy aims to leverage the strengths of both entities to scale its business. Successful collaborations include PayzApp and Vyapaar platforms created with Zeta and Mintoak.

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BANKING

The Reserve Bank of India's Governor has sparked debate by questioning whether deposits or advances come first in banking. The discussion centers on the impact of personal savings flowing into the stock market, affecting bank deposit growth. Experts argue that loans create deposits but not liquidity, emphasizing the need for stable deposits for credit growth.

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BANKING

State Bank of India chairman CS Setty emphasised the importance of consistent performance for stakeholders, with technology driving growth. Despite fluctuations in profit growth, SBI aims to ensure stability and reliability. Setty highlighted the role of customer service, reach, and convenience in attracting deposits, beyond just competitive rates.

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BANKING

The government is considering amending the SARFAESI Act, 2002, to allow banks to hold security interest in shipping vessels, removing special exemptions for fishing vessels. This change aims to fast-track loan recovery processes and address ambiguities that delay recoveries. Other debt recovery laws are also under review for quicker resolution of non-performing loans.

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BANKING

Challa Sreenivasulu Setty, the new chairman of State Bank of India, is aiming to leverage the bank's extensive network and brand to attract more deposits while managing risks in infrastructure financing. He emphasises technology, customer service, and cyber security as key priorities to enhance productivity and maintain consistent performance.

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BANKING

HDFC Bank has implemented ESG-based risk assessment for wholesale banking loans to promote sustainable finance. Loans exceeding Rs 100 crore undergo detailed environmental and social assessments. The bank aims to increase income for marginal farmers and become climate-neutral by 2032, while also raising green deposits aligned with RBI guidelines.

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BANKING

Chief Economic Advisor V Anantha Nageswaran emphasized the need for banks to adapt to changing customer preferences and market dynamics. Speaking at an event by Indian Bank, he highlighted agriculture's role in economic growth and praised the bank's MSME Prerana programme. Indian Bank CEO S L Jain appreciated Nageswaran's insights on the economy and banking sector.

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BANKING

Mahindra & Mahindra Financial Services plans to expand its mortgage loan business, offering housing finance, top-up loans, and home improvement loans. The Mumbai-based NBFC will also join the government's affordable housing schemes. The company aims to invest 200-300 million rupees over the next year for this expansion.

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The NCLAT has issued a notice to IndusInd International Holdings Ltd over a plea by Reliance Capital's lenders seeking interest on delayed payments. The lenders want modifications to an earlier order and are asking for interest on the upfront cash amount until August 2024. IIHL must respond within two weeks.

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BANKING

Reserve Bank of India Governor Shaktikanta Das, speaking at the Bretton Woods Committee’s Future of Finance Forum in Singapore, expressed concerns about banks with significant commercial real estate exposure, noting that they could become targets for short sellers.

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BANKING

In March 2020, a State Bank of India-led consortium bailed out Yes Bank by infusing Rs 10,000 crore-a move primarily aimed at protecting depositors. SBI, which acquired a 49% stake with a three-year lock-in, now holds 24% after Yes Bank raised money through a follow-on public issue and the preferential issue of shares to private equity investors Carlyle and Advent International.

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BANKING

The National Bank for Financing Infrastructure and Development (NaBFID) may offer partial credit enhancement and first loss default guarantees to infrastructure companies. This could improve credit ratings and attract long-term investors. NaBFID is also considering offering credit default swaps to boost investor confidence, especially in foreign markets.

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BANKING

HDFC Bank, India's largest private sector lender, is negotiating with global banks like Barclays, Citigroup, and JPMorgan to sell up to $1 billion in loans. This move aims to align its credit book with deposits amid regulatory pressure. The bank's credit to deposit ratio has risen significantly following its merger with Housing Development Finance Corp.

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BANKING

Paytm's Vijay Shekar Sharma announced during the company's Annual General Meet that they will reapply for a payment aggregator license to RBI. The fintech firm received approval from the finance ministry to invest in its payment services business, allowing them to resubmit their application for the license.

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BANKING

Several small finance banks have increased their fixed deposit rates to over 8% for two-year tenures, competing with major banks like SBI and HDFC Bank. This move comes as alternative investment options grow, drawing funds away from traditional deposits. Some finance companies are also offering competitive rates above 8% on fixed deposits.

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BANKING

The Reserve Bank of India plans to maintain a 5% run-off factor on digitally linked deposits, despite industry requests for a lower buffer. This move aims to manage risks from quick withdrawals via internet or mobile banking, potentially impacting banks' liquidity and increasing demand for government bonds.

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BANKING

LGT Wealth India has appointed Poonam Mirchandani as the managing director of its wealth planning & family solutions division, effective August 2024. She will focus on advising family business owners, promoters, and high-net-worth individuals, expanding the firm's offerings in succession and estate planning, international wealth management, global mobility, and philanthropy.

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BANKING

NaBFID is in talks with the RBI to reduce capital requirements for financial institutions offering credit enhancement. This move aims to make the product more attractive and accessible for corporates. NaBFID also plans to develop securitisation of infrastructure assets and create a data repository for the sector.

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BANKING

Analjit Singh's family office has repaid debts worth ₹5,500-6,000 crore taken from KKR & Co a decade ago for investments in property and hospitality ventures. The final tranche of ₹1,200 crore was cleared last week using funds from a 3.2% stake sale in Max Financial, reducing the family's holding to 3.2%.

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BANKING

Carlyle, Premji Invest, and Mizuho are vying to acquire a controlling stake in Avendus Capital from KKR. The investment bank, valued at Rs 5,500-6,000 crore, is known for its strong presence in M&As and public market transactions. Final offers are expected soon.

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BANKING

The life insurance industry experienced significant growth in new business income in August, driven by the state-run Life Insurance Corporation. The industry collected ₹32,644 crore in total premiums, marking a 22% increase from the previous year. Private insurers also saw growth, although new rules on surrender value and agent commissions may impact future sales.

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BANKING

Iffco Tokio General Insurance Company has appointed Subrata Mondal as its new managing director and CEO. Mondal, who has been with the company since 2001, replaces H O Suri. With over 36 years of experience in the insurance industry, Mondal aims to continue providing customer-centric insurance solutions while embracing new opportunities and challenges.

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BANKING

A leaked letter from Union Minister Nitin Gadkari to Finance Minister Nirmala Sitharaman has sparked discussions on removing GST from insurance premiums. The GST Council, chaired by Sitharaman, will meet today to discuss this and other topics like rate rationalisation and online gaming. Gadkari argues that taxing life insurance premiums is unfair and deters growth in the sector. However, several states oppose the proposal due to potential revenue losses. The meeting will explore options to balance consumer benefits and state revenues.

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BANKING

RBL Bank has launched the 'Xtra Credit Card' in partnership with Indian Oil Corporation, offering customers up to 8.5% savings on fuel purchases. The bank expects a moderate growth of 12-15% in its credit card portfolio this fiscal year. The card will be issued via the Mastercard network and offers significant fuel points for every ₹100 spent.

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BANKING

Jio Financial Services and BlackRock Advisors Singapore have formed a joint venture named Jio BlackRock Investment Advisers Private Limited. Jio Financial will invest Rs. 3 crore in the venture. The company has received approval to increase foreign investment to 49%. This move aims to expand its fintech operations in India.

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BANKING

The Deposit Insurance and Credit Guarantee Corporation (DICGC) has introduced Daava Soochak, an online tool for depositors to track their claim status. This tool allows users to check claims by entering their registered mobile number. The initiative is part of DICGC's efforts to enhance services for depositors of failed banks.

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BANKING

Education loans for overseas courses are set to grow rapidly for non-banking financial companies (NBFCs) due to increasing demand for higher education. Crisil Ratings projects a 40-45% rise in assets under management, reaching over Rs 60,000 crore this fiscal. Despite country-specific concerns, asset quality remains stable.

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BANKING

The GST Council is set to discuss reducing the high GST on health and life insurance policies. While there's consensus on lowering the tax for life insurance, concerns remain about health insurance. States worry that insurers may not pass on the savings to consumers, and there's no active anti-profiteering body to ensure this happens.

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BANKING

AU Small Finance Bank and United India Insurance Company have announced a strategic partnership to offer general insurance solutions to the bank's customers. This collaboration aims to provide reliable and affordable insurance options across various categories, leveraging UIIC's extensive network and AU SFB's expanding infrastructure, covering 21 states and 4 union territories.

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BANKING

India aims to achieve a $30 trillion GDP by 2047, requiring significant growth in the financial services sector, especially banks. A report by BCG, FICCI, and Indian Banks’ Association highlights the need for $4 trillion in bank capital and emphasizes financial inclusion, digitization, and emerging technologies as key drivers for this growth.

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BANKING

“A large number of people are breaking out of the real poverty trap, so they’re able to start focusing on providing for the future,” Sanlam Chief Executive Officer Paul Hanratty said in an interview Thursday. “India is really at that point where a huge chunk of the population are now able to save and invest for the future.”

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BANKING

Kotak Mutual Fund CEO Nilesh Shah suggests that bank deposits could grow faster if the government parks short-term funds with commercial banks instead of the Reserve Bank of India. Currently, government funds with the RBI earn no interest and do not enter the banking system until spent by the government.

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BANKING

Banks in India are offering higher interest rates on deposits to attract savers, with more than two-thirds of deposits earning 7% or above by June 2024. This shift is driven by the need to meet rising credit demand, which continues to outpace deposit growth.

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BANKING

The committee is not in favour of a blanket GST exemption on life and health insurance premiums, said people aware of deliberations. It's likely to give a detailed report on the revenue impact under different rate scenarios for insurance products to the GST Council, which is scheduled to meet on September 9.

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BANKING

The number of credit cards in India is projected to reach 200 million by FY28-29, growing at a CAGR of 15%, according to a PwC report. The credit card industry has doubled its issuance over the past five years and is expected to continue this trend. However, debit card usage has declined due to the rising popularity of UPI and less attractive reward programs.

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BANKING

Banks have an advantage because of CASA, but CASA comes with the requirement of CRR and SLR. So it ends up balancing itself. Banks have stable sources of retail money and large deposits and it's also cheaper, but the cost to raise it (retail money) is large. In HFCs we have wholesale money, which may be expensive but the cost of raising it also lower. We also have ‘Bajaj’ brand advantage as compared to other HFCs, says Sanjiv Bajaj, Chairman, Bajaj Housing Finance.

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BANKING

"The issue was discussed at a meeting (last month) with the Advisory Board for Banking and Financial Frauds (ABBFF), and it was decided that it will be made mandatory for the lenders to check this list before dealing with such entities and further update it on a real-time basis," a senior bank executive told ET.

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BANKING

The Competition Commission of India has approved Ontario Teachers Pension Plan Board's acquisition of additional units in Highway Infrastructure Trust and Citrine Inclusion's stake in Utkarsh CoreInvest Ltd. These approvals are necessary for deals exceeding certain thresholds to ensure fair competition and prevent unfair business practices.

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BANKING

Bajaj Finserv chairman Sanjiv Bajaj aims to establish Bajaj Housing Finance as a leading mortgage company, akin to HDFC, following HDFC's merger with its bank subsidiary. The company plans a Rs 6,560 crore IPO to expand and meet RBI's listing mandate. Focus areas include retail home loans, developer financing, and tech-enabled customer ease.

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BANKING

Russia's trade with India is thriving, with Sberbank handling up to 70% of Russian exports to the country. Trade between the two nations nearly doubled to $65 billion in 2023. Despite Western sanctions affecting other markets, Sberbank has faced no operational issues in India. The bank is actively using Indian payment systems and sees no rupee surplus problems, thanks to increased Indian exports to Russia.

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BANKING

In recent feedback to the RBI, banks have suggested that the regulator impose an additional "run-off factor" of 2% to 2.25% as against the 5% increase prescribed in a recent draft guideline, sources aware of the development told ET. "Some banks have also proposed a gradual increase of three years in maintaining the liquid stocks under the new LCR (Liquidity Coverage Ratio) norms. They have requested a similar proportion of requests for other categories," a banker said on condition of anonymity.

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BANKING

Marc-Andre Blanchard, EVP and global head of sustainability at CDPQ, emphasized the importance of sustainability in driving profits and building businesses. CDPQ, with $452 billion in assets, focuses on sustainable investing to generate returns and foster economic development, particularly in low-carbon sectors, while actively engaging with portfolio companies and stakeholders.

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BANKING

PNB Housing Finance, backed by Carlyle, aims to grow its affordable loan book to ₹15,000 crore by FY27. Currently, the affordable housing sector contributes ₹2,500 crore. The lender plans to shift focus to high-yielding segments and expects its overall loan book to grow by 18% in the next three years.

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BANKING

Lenders to debt-laden Reliance Capital have accused Hinduja Group's IIHL of delaying the resolution plan approved by NCLT for Rs 9,861 crore. IIHL awaits approval from India's DIPP. NCLT has directed RBI and DIPP to expedite this process, with a hearing set for September 19, 2024.

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British insurer Aviva's India unit is under scrutiny for alleged tax evasion between 2017 and 2023. The company is accused of using fake invoices and covert cash payments to sales agents, potentially evading $5.2 million in taxes. Aviva is cooperating with authorities in their investigation.

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Visa and the Tourism & Hospitality Skill Council (THSC) have agreed to a three-year partnership worth up to USD 1 million to train at least 20,000 Indian youths in tourism-related skills. The initiative, involving the Ministry of Skill Development & Entrepreneurship, targets youths in 10 states to enhance tourism services in India.

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BANKING

Mastercard Inc. aims to combat online payment fraud by expanding the use of token technology to replace credit card numbers and passwords with biometric data such as fingerprints and face scans. The company is processing 1 billion tokenized transactions weekly and plans to tokenize all e-commerce transactions in Europe by the decade's end.

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BANKING

Prime Minister Narendra Modi urged financial regulators to intensify efforts against cyber fraud and improve digital literacy to support fintech growth. Speaking at the Global Fintech Fest, he emphasized the importance of using technology for risk management and fraud detection, and highlighted India's fintech advancements.

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BANKING

Liquidity in the Indian banking system has fallen significantly this month, according to a Union Bank of India report. It has dropped from a peak of Rs 2.86 lakh crore to Rs 0.95 lakh crore by August 28. This decline continues despite government and RBI appeals for banks to boost liquidity.

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BANKING

HDFC Bank, India’s largest private lender, plans to sell Rs 10,000 crore worth of loan portfolios through pass-through certificates. The move aims to cut exposure to certain sectors and address challenges in raising deposits. The sale will help improve the bank’s credit-deposit ratio.

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BANKING

An Indian tax investigation has revealed that British insurer Aviva breached commission regulations by using fake invoices and untracked cash payments. Between 2017 and 2023, Aviva's India business paid $26 million to entities claiming to provide services but were actually fronts for funneling money to sales agents, evading $5.2 million in taxes.

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BANKING

Insurance companies are adapting their products to meet the needs of the growing number of Indian students studying abroad. This year, 1.33 million Indians are pursuing higher studies overseas. Increased geopolitical risks and healthcare costs have led insurers like HDFC Ergo, Tata AIG, and ICICI Lombard to offer customized and comprehensive insurance plans. Flexible policies now cover medical expenses, accommodation, and return travel costs, aiming to rival university policies often at a lower cost.

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BANKING

State Bank of India chairman Challa Sreenivasulu Setty, appointed for three years, urges employees to elevate the bank into the most valued financial institution. He succeeds Dinesh Khara and aims to reinforce SBI's status as the 'Banker to Every Indian' and achieve service excellence. Under Setty's leadership, SBI aims for new milestones and strategic growth.

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RBI governor Shaktikanta Das announced plans to make UPI and RuPay global to improve cross-border payment systems. The central bank aims to create UPI-like infrastructure overseas and link UPI with other countries' fast payment systems.

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The National Company Law Appellate Tribunal has asked IL&FS to justify extending its protection from legal proceedings, which currently expires on October 15. NCLAT dismissed claims from Sadbhav Engineering and GKC Projects but demanded reasons for continued protection. If lifted, the order could impact 70 unresolved IL&FS entities under the IBC.

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BANKING

Challa Sreenivasulu Setty is set to become the 27th chairman of State Bank of India on August 28. With extensive experience across various roles in SBI, Setty has handled corporate banking, stressed assets, and retail banking. He takes over at a time when the bank is experiencing exceptional performance.

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BANKING

As per Sureka’s LinkedIn profile, he joined the lender in 2005 in its financial markets division. He was elevated to group president in October 2016. For the last four years, he was the head of treasury. Before joining Yes Bank, Sureka had worked with ICICI Bank for three years. Sureka is a chartered accountant from the Institute of Chartered Accountants of India.

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PMJDY's journey over the past decade has been nothing short of transformative. It has fundamentally changed the way banks and financial institutions operate, pushing them to reach the remotest corners of the country and serve the "Antyoday" - the poorest of the poor. Today, more than 53 crore Jan Dhan accounts have been opened, with a cumulative deposit balance exceeding ₹2.3 lakh crore. This is a testament to the scheme's success in nurturing a savings culture among previously unbanked individuals. Additionally, Jan Dhan account holders have been provided around 36 crore RuPay debit cards.

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Shriram Finance, an Indian non-banking lender, plans to raise $1.25 billion to $1.5 billion in the current fiscal year from international markets to diversify its borrowings. The funds will be raised through a mix of loans and bonds. This move comes after India's central bank required lenders to hold more capital for loans to NBFCs, increasing the cost of raising funds.

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Funding constraints and over-heating of credit in some geographies have also dented the growth momentum, microfinance industry association Sa-Dhan said, citing data from credit information company Crif High Mark.

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Yes Bank has entered into a co-lending partnership with Newtap Finance to offer personalized financing solutions on CRED. Dreamplug Technologies Private Limited (DTPL), the operator of CRED, will act as the Lending Service Provider (LSP) for Yes Bank and Newtap Finance in this partnership.

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Overseas credit card spending saw a significant rise post Covid-19 travel restrictions easing, outpacing prepaid payment instruments and debit cards. Despite a higher tax rate of 20% on international credit card transactions, spending increased by 63% between December 2022 and July 2024, driven by higher reward points and convenience. Debit cards saw only an 8% rise.

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RBI Governor Shaktikanta Das announced that the Reserve Bank of India is piloting the Unified Lending Interface (ULI) to enable frictionless credit. The platform is expected to be launched nationwide soon. This development was disclosed at the Global Conference on Digital Public Infrastructure and Emerging Technologies in Bangalore during the RBI@90 initiative.

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Domestic banks and non-banking financial companies raised their exposure to the Adani Group to 36% of its total debt by March 2024, lending ₹88,100 crore. The group’s debt increased due to capital expenditures in airports and green energy. However, a 45% rise in operating profit helped reduce its net debt-to-operating profit ratio to its lowest in six years at 2.19 times, down from 3.27 times a year earlier.

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Lenders to debt-laden Reliance Capital expressed concerns over the term sheet provided by IIHL for Rs 7,300 crore debt mobilisation, citing numerous conditions. The CoC sought further documents and moved to forfeit IIHL's Rs 2,750 crore escrow amount if defaults occurred. Interest on the debt from August 8 was also demanded.

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Anil Ambani faced a five-year ban from SEBI and a Rs 25 crore fine over fund diversion at Reliance Home Finance. Once flourishing in 2007, his ventures suffered severe setbacks after the 2008 financial crisis, ending in Reliance Capital's bankruptcy declaration in 2021.

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Research showed that while just 15% of insolvency cases have claims over Rs 1,000 crore, they make up 90% of recoverable value. Specialized tribunals are being recommended to expedite high-value cases, and Finance Minister Nirmala Sitharaman proposed new NCLT benches to tackle these concerns and improve resolution times.

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Secured lenders of Reliance Capital sought the National Company Law Appellate Tribunal's intervention to include interest on delayed payments by IndusInd International Holdings (IIHL). They also sought permission to forfeit ₹2,750 crore in case of default. This move followed a July NCLT order granting IIHL time extension for their resolution plan's implementation.

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India's HDFC Bank has decided against the $2 billion sale of a 20% stake in its non-banking subsidiary, HDB Financial Services, to Japan's MUFG. Instead, HDBC aims for HDB to be listed to comply with RBI regulations. The decision has disappointed Japanese officials who had shown strong support for the deal.

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India's banking sector is experiencing strong profitability and improved asset quality, but lagging deposit growth compared to credit growth presents challenges. Financial shifts, tax issues, and competitive investments are factors. Banks are exploring methods like better rates and special services to attract deposits. The divergence may end by June-October 2025.

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The minister emphasised on active outreach by RRB branches located in MSME clusters to ensure credit to small and micro enterprises, the statement noted, adding that she also highlighted that sponsor banks and RRBs must recognise the challenges that lie ahead, especially maintaining asset quality, expanding digital services and ensuring robust corporate governance.

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The investment was made through its consolidated subsidiary MUFG Bank and brings the total investment by MUFG in DMI Finance to Rs 4712 crores (approximately $565 million) adding to the $400 millon that MUFG invested in the company last April.

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This newly raised capital is to fund category expansion, product development through R&D and innovation, diversification of offerings, enhancing market presence, and catering to the evolving needs of the consumer in the home category.

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Tata Capital Ltd has applied to the Competition Commission of India for approval to merge with Tata Motors Finance Ltd. The merger, approved by both companies' boards in June, will see Tata Capital issuing equity shares to TMFL shareholders, resulting in Tata Motors holding a 4.7% stake. The move aligns with Tata Motors' focus on emerging technologies.

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For the June 2024 quarter margins for most non-bank lenders remained under pressure due to increased borrowings and lower fee income. NBFCs saw a mixed June quarter with some moderation in AUM growth led by weak disbursements and some marginal weakness in asset quality and credit costs due to seasonality, elections, and heatwave in northern states.

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Health insurance GST: Parthanil Ghosh of HDFC ERGO noted that the 18% GST on health insurance premiums has increased costs, affecting affordability. He suggested that reducing or exempting GST could lower premiums and improve penetration rates. Other challenges include financial literacy, trust issues, and the lack of a healthcare regulator, despite increased awareness post-pandemic.

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GST on health insurance: Finance Minister Nirmala Sitharaman faced calls to remove GST on health and life insurance, stressing these taxes existed before GST. The discussion highlighted India's challenges in insurance affordability and penetration. Experts argue that reducing GST could lower premiums and improve accessibility. High medical inflation and claim rejections also contribute to hesitancy in purchasing insurance.

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HDFC Bank is tackling a talent shortage in its wealth management sector by recruiting retail bankers from within and outside the organization. The bank's wealth team, which grows by up to 20% annually, manages wealthy clients in numerous cities. However, expanding in smaller towns is difficult due to a shortage of both high-net-worth individuals and qualified professionals.

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Foreign banks operating in India have requested the Reserve Bank of India (RBI) to extend the compliance deadline for the 2018 data localization guidelines to January 2025. These guidelines require that all payment system data related to Indian customers be stored exclusively within India. The banks have already started complying with the rules for new transactions but face challenges in moving or deleting historical data stored abroad.

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Amazon explored launching a separate app for its digital payments service, Amazon Pay, in India. The shift aimed to enhance visibility and usage outside the main e-commerce app. The strategy aligned with a recent Rs 600 crore investment in Amazon Pay India, reflecting the company's continued focus on the Indian market.

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Mumbai's banks saw their borrowings exceed ₹9 lakh crore by July 26, with credit growth outpacing deposit accumulation. As a result, lenders turned to short-term funding methods like interbank repo operations and infrastructure bonds. Despite some improvement in deposit accretion, banks continued to face liquidity shortages, prompting increased market borrowing to meet the rising credit demand.

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Bank of Baroda secured a ₹5,000 crore loan deal for SAIL, offering a 7.49% interest rate for a five-year period. Competing against major public and private sector banks, BoB's bid was the most competitive. SAIL will use the loan to fund its capital and working capital expenditures.

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Shriram Finance Ltd anticipated sustained growth in its micro and small enterprises sector, driven by demand for small loans. The company expected a yearly 25% growth in the MSME portfolio. In contrast, the commercial vehicle business saw slower growth. Shriram has diversified its operations and projects a notable rise in MSME loans soon.

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Future Enterprises, undergoing insolvency proceedings, saw Central Bank of India emerge as the frontrunner to acquire its 25% and 33% stakes in two insurance ventures with Generali. The committee of creditors approved the bank's bid to enhance its insurance sector presence while Future Enterprises sought to settle its debt issues.

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The firm is also exploring ways to raise funds through long-term bonds and debentures, he told ET, adding that TFCI will aggressively expand its wholesale and retail loan book as it is well capitalised at above 58%.

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Finance Minister Nirmala Sitharaman called for substantial reforms in multilateral development banks to secure additional funds for developing countries during the third Voice of Global South Summit. She stressed the need for swift and agile financing solutions and suggested fresh capital infusions. Highlighting a $4 trillion annual financing gap for sustainable development goals, Sitharaman urged for measures to optimize balance sheets and mobilize private capital. Emphasis was also placed on South-South cooperation to enhance development financing. An Independent Expert Group formed by the G20 was mentioned as part of ongoing reform efforts.

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Canara Bank is expanding its branches to address deposit mobilization challenges, with 150 new branches launched in FY23-24 and another 250 planned for FY25. CEO K Satyanarayana Raju emphasized investments in AI, ML, and cyber security. The bank plans partial stake divestment in its subsidiaries, aiming for listing by FY25-26.

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National Insurance Company Ltd (NIC) aimed to return to profit in the 2024-25 fiscal after nearly a decade of losses, reducing its FY 2023-24 loss to Rs 187 crore. The insurer targeted a Rs 100-200 crore profit, planned policy tariff revisions, and shifted focus towards retail health and motor insurance products.

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ICICI Prudential Life Insurance posted the sharpest reduction in margin among listed life insurance companies, with the value of new business (VNB) margin narrowing to 24% in the first quarter of fiscal 2025 from 30% a year earlier. Its annual premium equivalent (APE), meanwhile, rose 34.4% on year to ₹1,963 crore.

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RBI approved the appointment of former SBI Deputy Managing Director Salee Sukumaran Nair for a three-year term after S Krishnan's resignation. Nair, with over 35 years at SBI, has handled key assignments, including roles in corporate accounts and stressed assets. Shareholder approval is pending, and he is expected to start in September.

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BANKING

RBI increased policy repo rate hike by a cumulative 250 bps since May 2022, while the weighted average lending rates on fresh and outstanding rupee loans of scheduled commercial banks have increased by 181 bps and 119 bps respectively. Karur Vysya's net interest margin for the June quarter stood at 4.13%, down 6 bps as compared to what it was in the year-ago period. The bank earned a net profit of Rs 459 crore for the first quarter of the current fiscal, reflecting a 28% year-on-year rise.

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BANKING

Gold-loan NBFCs experienced reasonable growth in disbursements due to robust credit demand and operational resilience. The May 2024 RBI advisory limited cash disbursements over Rs 20,000, prompting a shift to digital channels. Despite a minor increase in turnaround time, gold-loan NBFCs saw a 12% rise in June disbursements.

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BANKING

Sumit Bali has been appointed by Yes Bank to head its retail business and collections from August 26. With extensive experience in retail banking, Bali joins Yes Bank after his tenure at Axis Bank. His appointment comes at a critical time as Yes Bank is in talks with Sumitomo Mitsui and Emirates for a stake acquisition.

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The central bank is expected to introduce these rules later this year and bankers are worried they will hurt profitability in the medium term.

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The Ministry of Corporate Affairs has introduced new accounting standards for insurance contracts, harmonizing them with global norms. These standards, effective April 1, 2024, are expected to enhance transparency and attract foreign investments in the insurance sector by allowing better risk assessment and comparison with global peers.

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The Reserve Bank of India has warned banks about the dangers of relying too heavily on third-party vendors. Deputy Governor J. Swaminathan mentioned a recent ransomware attack as a cautionary example and proposed linking insurance premiums to the risk levels of financial institutions to encourage stronger risk management.

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Life insurers are pushing sales aggressively to lock in customers before the new surrender value norms take effect on October 1. These new rules, which require insurers to offer guaranteed surrender values from the first year on non-participating products, are expected to pressure profit margins and change commission structures.

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Indian Renewable Energy Development Agency Ltd (IREDA) announced plans to establish a subsidiary to finance small businesses and retail customers involved in renewable energy projects. The subsidiary will partner with microfinance firms and other non-banking finance companies to provide support in areas lacking adequate banking services.

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Bajaj Finance Ltd. intended to raise up to $500 million from overseas markets. The company is negotiating with at least four foreign banks for terms of the loan, which will be priced against the Secured Overnight Financing Rate. This move comes after new RBI rules limited domestic borrowing options for shadow financiers.

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The Reserve Bank of India (RBI) recently took feedback from banks and financial institutions dealing with Russian funds registered in India. Some Russian financial institutions earlier sounded out RBI on a mechanism to let them use rupees lying in special accounts in India, for investment in stocks and securities here.

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Rana Ashutosh Kumar Singh has assumed the role of Managing Director in charge of Risk Compliance and the Stressed Assets Resolution Group at State Bank of India (SBI), following government approval last week. Gajendra Singh Rana, previously the chief general manager of the Mumbai circle, has been appointed as Deputy Managing Director for retail and real estate. Singh's new role includes overseeing departments previously managed by former MD Alok Choudhary. The recent changes come ahead of CS Setty's appointment as SBI chairman, succeeding Dinesh Khara, whose term ends on August 28.

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BoB and Canara Bank have increased their lending rates by 5 basis points on six-month and one-year tenures with effect from August 12. UCO Bank, too, has raised its lending rates by 5 bps, effective from August 10. One bps is 0.01 percentage point.

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The government and banks sought advice from attorney general R Venkataramani to regain public sector banks' power to issue look-out circulars against defaulters. Consultations with stakeholders and potential legal amendments are underway. Courts have previously ruled against banks issuing LOCs independently. A swift resolution is expected by involving the banking regulator, RBI, and possibly the Supreme Court.

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CareEdge Ratings has raised concerns about the credit-deposit ratios of Non-Banking Financial Companies (NBFCs) due to declining deposits. The rating agency suggests that these ratios could affect NBFCs' ability to secure funds. The report also highlights the need for increased regulatory supervision, which could lead to higher compliance costs. The State Bank of India (SBI) reported that credit growth in Indian banks is outpacing deposit growth, despite increased investments in mutual funds and equities.

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Finance Minister Nirmala Sitharaman emphasized the need for banks to focus on increasing smaller, consistent deposits, which are crucial for the banking system, as concerns grow over the widening gap between deposits and credit. She highlighted that while deposits grew by 10.6% as of late July, credit expanded by 13.7%, creating potential liquidity issues. RBI Governor Shaktikanta Das supported this view and noted that banks should innovate deposit schemes to attract more funds.

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BANKING

Finance Minister Nirmala Sitharaman urged banks to prioritize 'core banking' in a meeting with RBI's Central Board of Directors. The session reviewed budget provisions and the economic outlook after the 2024-25 Union Budget. The RBI kept the repo rate at 6.5%, forecasting a 7.2% economic growth rate for the fiscal year 2024-25.

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Jagdishan acknowledged that the banking landscape changed dramatically after the lender decided to merge with parent HDFC in April 2022, but he defended the decision.

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Morgan Stanley Asia Singapore and HDFC Flexicap Fund were among investors that bought Nexus Select Trust units valued at over ₹4,354 crore from Blackstone. This transaction reduced Blackstone's stake in the REIT from 43.1% to 22%. Units sold through open market block deals were priced at ₹138 each, slightly above the floor price.

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