Month: June 2021

SVC Co-operative Bank net up 6 per cent at ₹150 cr in FY’21

Banking & Finance

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SVC Co-operative Bank’s net profit increased by 6 per cent year-on-year (yoy) to ₹150 crore in the financial year ended March 31, 2021 against ₹142 crore in the previous financial year (FY20).

The Board of directors of the Mumbai-headquartered multi-state urban co-operative bank recommended a dividend of 12 per cent for the year, subject to approval from the Members during the Annual General Meeting.

Deposits and advances

SVC Bank’s total deposits grew about 5 per cent to stand at ₹17,332 crore as at March-end 2021 against ₹16,501 crore as at March-end 2020, according to the Bank’s statement.

Within total deposits, the proportion of low-cost CASA (current account, savings account) deposits rose to 27 per cent from 24 per cent.

Total advances were up about 6 per cent to ₹12,328 crore as against ₹11,608 crore.

Within total advances, retail advances rose 14.51 per cent to Rs 2,077 crore and corporate advances were up by 4.66 per cent to Rs 10,251 crore.

Gross non-performing assets (NPA) showed a marginal uptick to 3.96 per cent of gross advances as at March 31, 2021 against 3.74 per cent as at March-end 2020, the statement said. Net NPA was unchanged at 1.81 per cent of net advances.

The Bank’s capital to risk-weighted assets ratio increased to 13.89 per cent as at March-end 2021 against 12.96 per cent as at March-end 2020.

The 115-year-old Bank has a presence across 11 states through 198 branches and 213 ATMs

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2 Banking Stocks That You Should Start “Selling Now”

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Union Bank of India

According to broking firm Emkay Global, the stock of Union Bank of India is a sell as the firm expects a target price of Rs 30 on the stock. That is a near 15- to 17% knock from the current market price of Rs 35.70.

52-week high 52-week low Current market price
Union Bank 45.25 23.10 35.80

So, a few of the reasons Emkay Global cites for selling the stock is the relatively weak asset-quality profile, subdued return ratios and traditionally sub-par capital position, calling for continuous dilution.

“Despite weak core profitability, Union Bank reported a strong beat in net profits at Rs 13.2 billion (est. a loss of Rs 4.6 billion), driven by lumpy recovery from Bhushan Power and a tax reversal. The bank expects higher profitability in FY22 due to tax benefit on accumulated losses,” the broking firm has said.

Punjab National Bank

Punjab National Bank

Punjab National Bank is another sell by Emkay Global. According to the firm, sub-par growth and elevated stressed assets remain a concern.

The Punjab National Bank stock, which is currently trading at Rs 42.50, has a price target of Rs 33 by the brokerage firm.

52-week high 52-week low Current market price
PNB 46.40 26.40 42.5

“Despite the lumpy resolution of Bhushan Power & Steel in Q4, Punjab National Bank reported relatively moderate profitability vs. peers at Rs 5.9 bilion (est. Rs 6.2 billion), mainly due to the continuation of subdued growth and higher interest reversals on NPAs/waiver. We raise our target price to Rs 33 from Rs 29, mainly taking into account the earnings upgrade and revision in subs/investment value to Rs 7 from Rs 4. However, we retain Sell and underweight in EAP due to continued concerns around the bank’s asset quality and its sub-par return ratios compared with other Public Sector Banks,” the brokerage firm has said.

Conclusion

Conclusion

Banking stocks have no doubt rallied significantly following the opening-up of lockdowns across India. But, the over exuberance maybe a little overdone for the time being, given that the second wave of lockdowns, is likely to have some bearing on asset quality.

Also, some of the banks have raised capital and there is some serious equity dilution that has happened. To expect banking stocks to give whopping returns from here would a little far-fetched. Investors might continue to hold onto banking stocks and not buy, however, to expect significant gains from here on will be optimistic.

Disclaimer

Disclaimer

The 2 stocks mentioned above for a “sell” are taken from a brokerage report by Emkay Global. We are not a qualified financial advisor and any information herein is not investment advice. It is informational in nature. All readers and investors should note that neither Greynium nor the author of the articles, nor the brokerage would be responsible for any decision taken based on these articles. Please do consult a professional advisor. Greynium Information Technologies Pvt Ltd, its subsidiaries, associates and authors do not accept culpability for losses and/or damages arising based on information in GoodReturns.in



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Reserve Bank of India – Notifications

Notifications

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RBI/2021-22/51
DCM(Plg).No. 51961/10.27.00/2021-22

June 8, 2021

The Chairman & Managing Director
Chief Executive Officers
All Banks

Dear Sir,

Preservation of CCTV recordings

Please refer to our circular DCM (Plg) No. 1712/10.27.00/2016-17 dated December 13, 2016 wherein the banks were advised to preserve the CCTV recordings of operations at bank branches and currency chests for the period from November 08, 2016 to December 30, 2016, until further instructions, to facilitate coordinated and effective action by the enforcement agencies in dealing with matters relating to illegal accumulation of new currency notes.

2. In continuation to the above, keeping in view the investigations pending with law enforcement agencies, proceedings pending at various courts, you are advised to preserve the CCTV recordings of operations at bank branches and currency chests for the period from November 08, 2016 to December 30, 2016 in a proper way, till further orders.

3. Please acknowledge receipt.

Yours faithfully,

(Sudip Malik)
General Manager

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Is Covid-19 Vaccination a Must To Buy Term Insurance?

Personal Finance

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Insurance

oi-Sneha Kulkarni

|

Those who have not yet been vaccinated against the Covid-19 virus will find it difficult to purchase a term life policy, as companies such as Max Life and Tata AIA are now requiring mandatory Covid-19 vaccine certificates for term life insurance buyers, and other insurers are likely to follow suit, according to the report.

In a country with already inadequate insurance coverage, purchasing a safety net has grown more expensive, with premiums rising as a result of an increase in claims caused by virus infections.

Is Covid-19 Vaccination A Must To Buy Term Insurance?

Max Life only issues term insurance to persons over the age of 45 who can present their final vaccination certificates, while Tata AIA only issues coverage to individuals who have had their first shot, regardless of age, as per the report.

Customers who have been vaccinated and want to get health insurance can get up to a 5% discount from Reliance General Insurance.

While it is a positive step from the insurer’s perspective, it will have a detrimental impact on those who have not yet been immunized. This could be due to a vaccine scarcity, and if a final vaccination certificate is required, a person will have to wait 84 days before receiving the second dose. In a country of 1.38 billion people, only 23.28 crore people had fired their first shot as of Monday.

Some insurers, including ICICI Prudential, Tata AIA, and Aegon Life, have implemented a seven to fifteen-day “cooling off period” following vaccination. New policy applications are temporarily postponed.

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ICICI gets 2 million customers of other banks on iMobile Pay, BFSI News, ET BFSI

Banking & Finance

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‘iMobile Pay’ is ICICI Bank’s mobile banking application whose revamped version is now being used by two million customers of other banks pan India. The bank has reached this figure in a span of just five months after making ‘iMobile Pay’ open to all, including customers of other banks.

ICICI Bank opened its mobile banking platform ‘iMobile Pay’ to customers of all banks in December 2020. It was a first-in-the-industry initiative that provided the significant convenience of interoperability, as it enabled users of any bank to link their account to the app and begin transacting digitally. It also offered them access to an entire range of ICICI Bank services including savings account, home loan, credit card, personal loan among others.

“ICICI Bank has always believed in introducing innovations that simplify banking for customers. In line with this philosophy, the ICICI Bank was the first to introduce a mobile banking app in the country in 2008, called ‘iMobile’. The Bank has transformed the app and renamed it ‘iMobile Pay’ five months ago to offer interoperability so that anyone, including customers of other banks, can experience the benefits of hassle-free payments and digital banking of ICICI Bank through this app. This was made possible by leveraging NPCI’s interoperable infrastructure.” said Bijith Bhaskar, Head- Digital Channels & Partnership, ICICI Bank in a statement.

“Many customers are entering into a new relationship with the Bank after downloading the app. They are opening savings accounts and applying for a credit card, home loan and personal loan among others.” he added.

The ‘pay to contact’ feature enables the customers to send money either to a mobile number or a UPI ID of their contacts, who are registered on any payment app or a digital wallet. In addition to this, features like ‘scan to pay’, bill payments, ‘check balance’ have seen maximum usage, as quoted by the bank. It has also added bill payment services on the app, to enable payments for DTH, utility services such as electricity, gas and water, FASTag recharge (including that of other banks), insurance and mobile postpaid among others.



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20 lakh customers of other banks log in to ICICI Bank mobile app

Banking & Finance

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Over 20 lakh customers of other banks are now using ICICI Bank’s revamped mobile banking app.

“The bank has paced to the milestone in a span of just five months after making iMobile Pay open to all, including customers of other banks,” ICICI Bank said in a statement on Tuesday.

Also read: 10 lakh customers of other banks using ICICI Bank’s mobile app

Trends reveal that customers are using features such as pay to contact, bill payments and scan to pay.

ICICI Bank had opened its mobile banking platform to customers of all banks in December last year.

“The bank has transformed the app and renamed it ‘iMobile Pay’ five months ago to offer interoperability so that anyone, including customers of other banks, can experience the benefits of hassle-free payments and digital banking of ICICI Bank through this app. This was made possible by leveraging NPCI’s interoperable infrastructure,” said Bijith Bhaskar, Head – Digital Channels and Partnership, ICICI Bank.

Also read: ICICI Bank revamps app to offer services of any bank

The app has seen an encouraging response from metro cities and leading state capitals including New Delhi, Bengaluru, Chennai, Hyderabad, Lucknow, Patna, Jaipur, Ahmedabad, among others.

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Reserve Bank of India – Press Releases

Press Releases

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Sr. No. State Notified Amount
(₹ Cr)		 Amount Accepted
(₹ Cr)		 Cut off Price (₹) / Yield (%) Tenure (Yrs)
1. Andhra Pradesh 1000 1000 7.00 17
1000 1000 7.01 18
2. Gujarat * 1000 1500 6.72 9
3. Punjab 1000 1000 6.81 10
4. Rajasthan 1000 1000 6.80 10
500 500 7.07 25
5. Tamil Nadu 1500 1500 93.12/7.0485 Re-issue of 6.49% Tamil Nadu SDL 2050 issued on July 22, 2020
1500 1500 94.62/7.0481 Re-issue of 6.63% Tamil Nadu SDL 2055 issued on July 08, 2020
6. Telangana 2500 2500 7.04 30
  Total 11000 11500    
* Gujarat has accepted an additional amount of ₹500 crore in today’s auction.

Ajit Prasad
Director   

Press Release: 2021-2022/335

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2 New Special FD Schemes For Customers Who Have Taken COVID Vaccine

Personal Finance

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UCOVAXI-999 Scheme By UCO Bank

According to a PTI source, city-based UCO Bank is providing individuals who have taken at least one dose of a COVID-19 vaccination a 30 basis point (bps) higher rate on 999-day fixed deposits. “We are also taking minor steps to encourage vaccination drives. We are offering UCOVAXI-999… for a limited period till September 30,” a bank official stated. UCO Bank also stated on its Twitter account that “Are you #vaccinated? #UCOBank introduces #UCOVAXI999, an attractive Fixed Deposit Scheme for the Vaccinated Individuals! Contact nearby Branch for details! T&C Apply!.” If an investor is vaccinated and deposits in UCO Bank Fixed Deposit for 999 days or above 2 Years up to 3 Years then he or she will get an interest rate of 5.3% respectively under the UCOVAXI-999 scheme of the bank. But in case the investor is not yet vaccinated, then he or she will get the applicable rate of 5.00% only for the same period.

Immune India Deposit Scheme of Central Bank of India

Immune India Deposit Scheme of Central Bank of India

In a bid to encourage its customers to get vaccinated, the Central Bank of India has also recently launched a new fixed deposit scheme called “Immune India Deposit Scheme” which is in force from 13.04.2021. An existing customer who has taken at least one dose of COVID-19 vaccine with proof of it will be eligible for the scheme. For the general public, senior citizens, staff, ex-staff, and senior citizen ex-staff, the scheme will be offered in MIDR, QIDR, MMDC, and FDR. The deposit must be made for 1111 days and no deposit for a longer or shorter period will be allowed under the scheme. A deposit can be made under this scheme by making an initial contribution of Rs 1000 up to a ceiling of Rs 2 Cr. Immune India Deposit Scheme – for individuals who are vaccinated, an additional interest rate of 25 basis points (bps) above the applicable card rate is offered. As a result, the scheme’s rate of interest will be 5.35 per cent, subject to change. Senior citizens, on the other hand, are eligible for additional interest as applicable. The Scheme is only valid until December 31, 2021. Premature withdrawal is permitted, and the applicable rate of interest for the deposit period will be provided, subject to the regulations regulating premature withdrawal. The bank has stated some guidelines on its official website that “Branch will ensure that customer provides any satisfactory proof of getting administered a jab of any COVID-19 vaccine. Branch will note down reference ID of Vaccination or keep in record hard copy of certificate to this effect.” Eligible customers can also collect the Deposit Receipt generated under this scheme online by applying and providing the COVID-19 vaccination reference ID on online platforms of the bank. As with other Term Deposit Schemes, an OD facility against this deposit, a Nomination Facility, and a Joint Account facility (if the first holder meets the Scheme’s rules) are allowed.

What should you do?

What should you do?

Fixed deposits are unquestionably among the strongest short-term and long-term investment possibilities. They provide a high rate of return, flexible tenor and liquidity options. Though fixed deposits are primarily for risk-averse investors, the new schemes mentioned above may be a smart choice for you if you have a short-term goal, and you have been vaccinated. If a higher return is all that matters, you can still invest in savings accounts, recurring deposits, debt, or large-cap mutual funds.



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4 Risks of Investing In Fixed Deposits

Personal Finance

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Liquidity Risk

Fixed Deposits may be withdrawn at any point of time, and though you may not get the pledged interest, as a result, they are called liquid assets since they may be liquidated at any moment. Bank FDs are simple to liquidate, meaning that you can break your FD before it matures. Unfortunately, a penalty may be imposed, and the amount of the penalty differs from one bank to the next. In the instance of tax-saving FDs, you can withdraw before the 5-year term expires. If we take liquidity risk as an example, customers need to pay a penalty of 0.50 per cent across all maturities for premature withdrawals from SBI FDs up to Rs 5 lakh. The bank has set the penalty for premature withdrawals from SBI fixed deposits of more than Rs 5 lakh but less than Rs 1 crore at 1% for all tenure. On deposits that are kept for less than 7 days, no interest will be provided.

Bank default risk

Bank default risk

In case of a bank default, an investor is solely insured by the Deposit Insurance and Credit Guarantee Corporation (DICGC). Savings accounts, fixed deposits (FD), current accounts, recurring deposits (RD), and other deposits are covered by DICGC’s insurance. Each depositor at a bank is covered up to a total of Rs 5 lakh for both principal and interest amounts, according to DICGC norms. If you have a fixed deposit in the same bank as a joint holder with your spouse, brother, or children, or if you open an FD as a guardian of a minor, and so on, all of these FDs will be regarded as maintained in a different capacity and right, and each account will be insured up to Rs 5 lakh individually. The DICGC insures all commercial banks in India, including foreign banks, local area banks, and regional rural banks and cooperative banks. The DICGC, on the other hand, does not cover deposits in primary cooperative societies. Furthermore, deposits in any NBFC, HFC, or corporate entity are not covered by DICGC. However, one should keep in mind that if you have deposited Rs 5 lakhs in a fixed deposit, you will only be paid for the principal amount, not the interest earned on the deposits if your bank collapses and if the total amount of the principal and accumulated interest is less than Rs 5 lakh, you would be paid the whole amount.

Inflation Risk

Inflation Risk

FD returns can often be on par with or even less than inflation, resulting in wealth destruction for the holder. Fixed deposit investors must pay extra attention to their asset allocation under the context of rising inflation and dropping interest rates, especially for those in the highest tax bracket. Even though many people consider volatility to be a concern while investing in mutual funds, inflation must be considered a significant risk when investing in fixed-income securities like fixed deposits. When evaluating returns on your deposit, it’s crucial to keep inflation in mind and understand the distinction between estimated returns and real returns. When it comes to fixed deposits, banks’ interest rates rarely surpass inflation. Furthermore, when interest income is taxed, fixed deposit returns especially in long-term deposits may go down below the inflation rate. To stay ahead of the interest rate advantage, it is preferable to invest in a short-term fixed deposit. Short-term depositors in lower tax brackets may be unaffected by inflation.

Interest Rate Risk

Interest Rate Risk

Bank FDs have the potential of locking you in for a lengthy period of time at a poor rate of return. For a long time, most banks have been reducing their FD rates. If you’re a fixed-income investor who relies on interest rate return, you’ll have to face hardship if you invested in a 5-year lock-in period. By considering interest rate risk, you will not gain if interest rates rise in the economy since you are locked into the FD at the present rate which is not a good sign for any investor. But if you have a 5% FD and market rates drop by 1%, you will effectively gain since you will be generating more than the market. To mitigate the interest rate risk of a fixed deposit, split your investments into different amounts and invest them for different periods of time. Splitting your deposit will protect you from interest rate swings while also providing you with greater returns.



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PM Kisan Pension Scheme: How Farmers Can Get Rs. 36000 Yearly through PM Mandhan Yojana

Personal Finance

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PM Kisan Pension Scheme: Who is eligible?

The objective of this project is to provide all of the country’s farmers with a monetary cushion in the form of a monthly pension. This programme is available to all farmers over the age of 60 who are registered under the Pradhan Mantri Kisan Samman Nidhi Scheme.

Under the PM Kisan Maandhan Yojana, any farmer between the ages of 18 and 40 can participate. He is required to contribute in part until he reaches the age of 60.You can take advantage of this design, which contains only 2 hectares of cultivable land. The Village Level Entrepreneur must contribute an initial monetary investment.

How to Register for PM Kisan Maandhan Yojana online?

How to Register for PM Kisan Maandhan Yojana online?

tep 1: Visit https://maandhan.in/ and

Step 2: look for Pradhan Mantri Kisan Maandhan Yojana

Step 3: Click Self enrollment

Step 4: Enter OTP

What is the monthly contribution for PM Kisan pension scheme?

The monthly contribution ranges from Rs 55 to Rs 200. Farmers who reach the age of 60 will receive a monthly pension of 3000 rupees or a yearly pension of 36000 rupees under this program.

PM Kisan Mandhan Yojana offline registration

PM Kisan Mandhan Yojana offline registration

Farmers who want to participate in the program must go to their nearest Common Service Centre (CSC). Details such as the Aadhaar Card Number and IFSC Code of Savings Bank Account are required.

For authentication, the person will fill in the Aadhaar number, subscriber’s name, and date of birth as they appear on the Aadhaar card. After that, the system will determine the monthly payment due based on age. The first subscription fee will be paid in cash to the VLE by the subscriber. A Kisan Pension Account Number will be generated, as well as a Kisan Card.



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