RBI to defer putting lending, expansion curbs on PNB till Q1 results

Andhra Bank, Punjab and Sind Bank, and Canara Bank, too, are likely to make a similar presentation before the regulator

The Reserve Bank of India (RBI) may defer putting lending and expansion restrictions on Rs 143 billion fraud-hit Punjab National Bank (PNB) till the first-quarter results of 2018-19 are out.

The regulator has conveyed to the management of the bank in a recent meeting that it will examine, after looking at the June quarter results, whether PNB’s financial conditions warrant putting it under the prompt corrective action (PCA) framework.

“The regulator will take a call after the June-ended quarter results (are declared). The regulator has told PNB to improve recovery, shed risk-weighted assets, and focus on reducing expenditure till then,” an official said.

PNB, led by its Chief Executive Officer and Managing Director Sunil Mehta, made a presentation on its revival plan to the RBI last Monday, requesting the regulator to defer action under PCA till December, according to sources.

Most public sector banks (PSBs) declare their financial results for the April-June period between the end of July and beginning of August. So PNB may not face any business restrictions till at least August if the regulator has its way.

“Looking at the PCA framework, PNB, like a few other banks, fulfils a couple of important parameters to be added to the list. But PCA will not affect business operations as such. In the present situation, no bank is looking at aggressive credit growth, looking at branch expansion or aggressive hiring, and these are a few things that the banks have to go slow on under PCA,” said Karthik Srinivasan, senior vice-president—group head, financial sector ratings, Icra, adding, “it does not change life for any bank unless the RBI puts a specific lending restriction.” According to a recent report by Credit Suisse, with net non-performing assets (NPAs) over 8 per cent and common equity tier levels down to less than 6 per cent, PNB and Andhra Bank are likely candidates for PCA. Under RBI rules, fulfilling any of the three conditions — net NPA levels above 6 per cent, two years of consecutive losses, or the capital adequacy ratio below the regulatory requirement — could put banks under PCA. PNB suffered the highest ever loss by any domestic bank, at Rs 134 billion, mainly due to the Rs 143-billion swindle on account of fraudulent loans to jewellery firms belonging to Nirav Modi and Mehul Choksi and the RBI’s new provisioning norms. Last week, on the directives of the finance ministry, apart from PNB, Union Bank also met the regulator, urging a deferment of PCA by citing a revival plan.

Upcoming bank and government exams in 2017

The candidate should be careful while filling out the application

More than 1.5 crores candidates took up the bank exams of IBPS (Institute of Banking Personnel Selection) in the last three years and vacancies in the Indian banks equaling 68000 were occupied.

When it comes to making a career choice that promises security and financial stability, bank jobs in India have always been roped in first. Public sector banks are getting a tough competition from private banks. As a result, they are reaching out to rural and semi-urban areas. Despite the rise of Information Technology, millions of people still prefer bank jobs and apply for various positions in public sector banks.

Here’s the list of upcoming bank exams and jobs in 2017. It also features other government exams.

Listed are the important details regarding the Bank Exams and jobs for the year 2017-18:

How to Apply for SBI Management Executive Recruitment:

An aspiring candidate should have their valid active email ID for better communications regarding results other important announcements. It helps them receive Call Letter/Interview Advices and other important documents by email. The candidate has to register online through the Bank’s website https://bank.sbi/careers and www.sbi.co.in/careers and pay the application.
The candidate should scan their latest photograph and signature. This is essential for online application otherwise the application would be invalidated.

The candidate should go the bank’s website (www.bank.sbi/careers/) and (www.sbi.co.in/careers). In the Recruitment link, select the suitable online application format. Read more

RBI raises ATM withdrawal limit to Rs 10,000 a day

Up to Rs 1 lakh can be withdrawn per week from current accounts

Further relaxing the rules for cash withdrawal from automated teller machines (ATMs), the Reserve Bank on Monday raised the cap from Rs 4,500 a day to Rs 10,000 for each card, but within the existing weekly limit of Rs 24,000 per week, with immediate effect.

Besides, current account holders can now withdraw up to Rs 1 lakh per week. Earlier, they were allowed to withdraw only up to Rs 50,000 in cash in a week. This facility has been extended to overdraft and cash credit accounts as well.

Already the cash availability has improved vastly in cash vending machines as more new notes are getting released in the system, but the weekly limit persists. The enhanced withdrawal limit, will help banks to bring down the transaction cost, which has now been waived off by the central bank till March.

The RBI had imposed these limits in November after the government announced a ban on all high-value currency notes, and said it would replace them with new notes.

The withdrawal limits are unlikely to be removed completely until the RBI has supplied the economy with sufficient amount of new notes, analysts said.

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PAC may summon PM Modi over cash ban issue if RBI's reply not satisfactory

PAC meeting to discuss issue of demonetisation has been called on January 20

Breaking News : The Public Accounts Committee (PAC) of Parliament can call Prime Minister Narendra Modi on the issue of demonetisation if it is not satisfied with the answers given by top finance ministry officials and the RBI Governor Urjit Patel, to whom a detailed questionnaire has been sent.

A PAC meeting on this issue has been called on January 20th, in which the RBI Governor Urjit Patel, Finance Secretary Ashok Lavasa and Economic Affairs Secretary Shaktikanta Das will be present.

"We have not yet received answers to the questions we have sent to them. They will reply few days before the January 20th meeting. Their replies will be discussed in detail," PAC Chairman and senior Congress leader K V Thomas told PTI.

Asked if the PAC would call the Prime Minister if replies were not satisfactory, he said: "The committee has all right to call anybody involved in the matter. But that will depend on the outcome of the January 20th meeting. We can call PM on demonetisation issue if members unanimously decide."

In a meeting with the PM after demonetisation announcement made on November 8, Thomas said, "I had met him and he said that the situation will be normal after 50 days by December-end. But it does not looks like."(more)

Demonetisation trouble not over, to spill over into new year: Bankers

AIBEA GS expressed his anger at state of bank employees who are being targets of customers' wrath

Breaking News : A mere four days before the demonetisation deadline of December 30, by when the pains of customers are supposed to allay -- as Prime Minister Narendra Modi said -- bankers seemed to nurse no hopes of any comfort and expected long queues to slither into the new year and into the months that follow.

"The rush is still there and there's no hope of any respite. How can there be any when the RBI (Reserve Bank of India) is providing only 20-30 per cent of total cash required at the banks?" All India Bank Employees Association (AIBEA) General Secretary C.H. Venkatachalam told IANS.

"The situation has not improved much. We had written to even RBI Governor Urjit Patel, apprising him of the situation. But then this is India, you cannot expect a swift reply from anyone. There's no transperancy," he said.

Venkatachalam expressed his anger also at the sorry state of bank employees who are being targets of disillusioned customers' wrath for no fault of theirs.

He blamed RBI for eroding customers' confidence in the institution of banks by not coming up with any satisfactory answers for the instances of new currency being seized all over the country, while none of this is reaching the legitimate candidates.(more)

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'Demonetisation may have cost banks Rs 3,000 cr per day'

On Wednesday, the Reserve Bank of India (RBI) withdrew its previous directive that required deposits above Rs 5,000 in old currency notes be justified to two bank officers. To understand the impact of this move, Business Standard spoke to the HARVINDER SINGH, general secretary of the All India Bank Officers Confederation.

The Reserve Bank of India (RBI) has withdrawn its previous directive that required deposits above Rs 5,000 in old currency notes to be explained to bank officers. What do you make of this?

Breaking News : We have been pleading before RBI and Ministry of Finance that instructions issued for general public must be always clear. What was happening was that instructions issued through electronic media or notifications were reaching banks much later than when the people at large were coming to know. There was time gap between the implementation of the instructions issued by the RBI/government because when the instructions reach banks, they would have to modify their systems so that the instructions are implemented.

For example, one instruction came that we will permit withdrawal of 2.5 lakhs per family where there are marriages. Lot of conditionality were put. But these instructions were made viral during the mid of the day but actually these instructions were received by banks two days after. For these 2-3 days bank officers were facing a lot of problem.

Right from the day this policy of demonetization was declared we have been pleading with the RBI and government that you consult with us. We will give you the ground level problems. We will give you suggestions for smoother implementation. But no opportunity was ever granted to us.Read more.

Now, banks asking for source of funds deposited in old currency

A day after the Union government announced that bank customers would now need to provide satisfactory explanation while depositing more than Rs 5,000 in old currency notes, every bank has come out with its own way to evaluate its customers.

At one of the Central Bank branches in the national capital, the bank manager appeared reluctant to accept old currency in the denomination of Rs 500 and Rs 1,000. “This new scheme is to fix the bank officials. They will ask me why I took money in old currency,” said the visibly upset manager, who did not wish to be identified.

The manager was asking each customers to write an application detailing why she didn’t deposit the money before December 20. The bank has also designed a form asking the customers to fill details like name, account number, and since when she had held an account at the branch.

The customers were also being asked about the details of their last deposit. Some customers were asked to attach copies of their PAN, along with their application letters.

The customers in their applications mentioned various reasons for not depositing the money earlier. However, long bank queues and December 30 being the initial deadline for depositing cash were the most cited reasons on the application forms.

At another public sector bank, the branch manager was yet to begin the process of accepting old currency notes above Rs 5,000 in total value. “I am yet to get directions from my seniors,” the manager said on the condition of not being identified. But the manager was clear that no old currency would be accepted if the customer didn’t have any concrete reasons.

“I will ask for evidence of hospitalisation or travel because I don’t want to face any inquiry in the future,” the manager said.

Private banks, a few of which are under scrutiny over money laundering to businessmen, are more sceptical. The second-largest private bank has come out with a form asking customers to detail the source of funds, besides other details.

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Full text: RBI caps deposits exceeding Rs 5,000 to just one before 30 Dec

The new restrictions are meant to encourage deposits of demonetised currency notes under the Taxation and Investment Regime for the Pradhan Mantri Garib Kalyan Yojana, 2016.

The RBI on Monday restricted deposits of demonetised Rs 500 and Rs 1,000 notes in excess of Rs 5,000 only once till December 30 -- after strict scrutiny.

The new restrictions are meant to encourage deposits of demonetised currency notes under the Taxation and Investment Regime for the Pradhan Mantri Garib Kalyan Yojana, 2016.

In its notification, the Reserve Bank of India instructed all the banks to give full credit to demonetised notes over Rs 5,000 only in the case of accounts compliant with 'Know Your Customer' (KYC) norms

If the accounts are not KYC compliant, then the credit for deposits of demonetised currencies will be restricted to Rs 50,000.

Here is the full text of the RBI notification:

RBI/2016-17/189

DCM (Plg) No. 1859/10.27.00/2016-17

December 19, 2016

The Chairman / Managing Director/ Chief Executive Officer,

Public Sector Banks/ Private Sector Banks / Foreign Banks/ Regional Rural

Banks / Urban Cooperative Banks/ State Cooperative Banks

Dear Sir,

Withdrawal of Legal Tender Character of existing ? 500/- and ? 1000/- Bank Notes (Specified Bank Notes) - Deposit of Specified Bank Notes (SBNs) into bank accounts

Please refer to Circular DCM (Plg) No.1226/10.27.00/2016-17 dated November 08, 2016 on the captioned subject. On a review of the provisions ii, iii and iv at C of Para 3 dealing with credit of the value of SBNs into bank accounts it has been decided to place certain restrictions on deposits of SBNs into bank accounts while encouraging the deposits of the same under the Taxation and Investment Regime for the Pradhan Mantri Garib Kalyan Yojana, 2016 as indicated below: Read more

Lining up at the ATM? Here's how your cash actually gets there

From the printing press to the ATM, its a journey that starts with calculations at the Reserve Bank of India

Everyone likes money, especially with the Modi government's Demonetisation policy in full swing. But how does the Rs 100 note, which has reasserted its real value, and the new Rs 500 and Rs 2,000 notes reach your nearest automated teller machine (ATM)?

From the printing press to the ATM, its a journey that starts with calculations at the Reserve Bank of India and culminates in the execution of a very complicated logistics plan.

From the printing press to the ATM:

1) Finding our the country's cash needs: The RBI first calculates India's annual cash requirement. According to an Indian Express report, the calculation takes into account the quantity of notes in circulation, those which might have been destroyed, and how many would be needed for replacement. Other factors, the report added, such as projected GDP growth and inflation are also accounted for. The process starts early in the calendar year, before the new fiscal year begins, and RBIinforms the Ministry of Finance about the amount of currency that needs to be printed.

2) Telling the printing presses: India has four printing presses: One in Nashik (Maharashtra), one in Dewas (Madhya Pradesh), another in Mysuru (Karnataka( and the last in Salboni (West Bengal). These presses print out the notes after an order is placed with them and instructions are received regarding denominations and quantity of notes to be printed. The high-security paper used to print the notes comes from the currency paper mills in Mysuru and Hoshangabad.

3) Distributing the notes across the country: Once the notes have been printed, they need to be distributed across 19 regional centres of the RBI. Along with these centres, there are 4,000currency chests which serve areas not covered under these centres and they too need to receive the freshly printed notes. However, as explained by the IE report, even after these notes have reached their destinations, they do not hold any value till they are backed by cash or securities of equal value.Read more

Decoding the big ATM problem: India just doesn't have enough engineers for the job

Decoding the big ATM problem: India just doesn't have enough engineers for the job

Ten days on, the banking sector is yet to recover from the government's Demonetisationmove. There are two main reasons for this. One, there is just not enough new notes being supplied by the Reserve Bank of India (RBI), even after running its printing presses over time. And the second, there are not enough technicians to recaliberate automated teller machines in the countries.

Only once the ATMs are recalibrated and enough Rs 500 notes are printed, the chaos will be under control, say bankers.

Even as top bankers are assuring public that the situation will normalise in a week, bankers behind the counters think otherwsie.

The new 500 notes have not been released in rural areas. Most of the branches just 20-30 kilometers from metros have not seen the new 500 rupee note as the currency chests are currently available only in cities. Even in metros, the stockpile of the new notes is thin.

A public sector bank branch manager in the outskirt of Kolkata told Business Standard that the currency chests are now dispensing soiled, old Rs 100 notes. Several customers withdrawing money from banks confirmed this. Customers who have withdrawn Rs 100 notes are not releasing them for daily transactions. Hoarding has ensured that the central bank is being forced to release old scrapped notes to the general public again.

The lack of technicians is the bigger problem.Read more.

Nifty hovers above 8,550; Tata Motors up 4%

Nifty hovers above 8,550; Tata Motors up 4%

Markets have shrugged off the clearance of GST in the upper house and are trading in a narrow range with Sensex and Nifty swinging between negative and positive zone.

By 10:25 am, the S&P BSE Sensex was up 48 points at 27,746 and the Nifty50 gained 14 points to trade 8,559. Broader markets are outperforming the benchmark indices- BSE Midcap and Smallcap indices are up 0.5% each.

"Contrary to popular belief, the passage of the GST Constitutional Amendment marks only the beginning of a fairly tedious procedure that should ultimately result in the implementation of a unified GST in India at best by 2HFY18. Even as the adoption of a unified GST is one of the most remarkable tax reforms from a long-term perspective, in the short-term we highlight that this is likely to result in (1) a mild pick-up in inflation as hitherto untaxed goods and services are now brought under the tax net, (2) a meaningful loss of jobs in the informal sector as this sector will no longer be able to fly under the radar of the taxman and (3) consequently trigger pro-electorate measures in the form of higher revenue expenditure from FY18 onwards as the Modi-led BJP Government begins preparing for the 2019 General Elections," adds Ritika Mankar Mukherjee, Senior Economist, Ambit Capital.(more)