Category: Banking & Finance

Andhra Bank-Union Bank IT integration completed

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The IT integration of all branches of erstwhile Andhra Bank (e-AB) with Union Bank of India (UBI) has been completed, according to UBI.

In November 2020, the IT integration of all the branches of erstwhile Corporation Bank (e-CB) with UBI was completed.

Andhra Bank and Corporation Bank were amalgamated with UBI with effect from April 1, 2020, making the amalgamated entity the fifth largest public sector bank in the country.

As of March-end 2020, UBI had 4,281 branches. Following the amalgamation, the bank’s network jumped to 9,587 on April 1, 2020.

“All customers of erstwhile Andhra Bank and Corporation Bank have been successfully migrated to CBS (core banking solution platform) of Union Bank of India in record time…with least inconvenience to customers,” the bank said in a statement

There is no change in customers’ account numbers, debit cards or net banking credentials. The current IFSC code and cheques can be used till March 31, 2021, the bank added

Rajkiran Rai G, MD & CEO, said the integration of all branches and delivery channels of erstwhile Andhra Bank and Corporation Bank opens huge opportunity for UBI’s customers’ and enhances the bank’s capability to offer innovative products and services.

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Kotak Mahindra Bank Q3 net profit up 16%

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Private sector lender Kotak Mahindra Bank reported a 16.1 per cent increase in its standalone net profit at ₹1,853.54 crore for the third quarter of this fiscal against ₹1,595.90 crore in the same period last fiscal.

Net interest income for the quarter ended December 31, 2020, rose by 17 per cent to ₹4,007 crore, from ₹3,430 crore a year ago. Net interest margin for the quarter under review was at 4.51 per cent.

Other income was almost flat at ₹1,334.38 crore in the third quarter of this fiscal versus ₹1,341.43 crore a year ago.

Provisions rose by 34.9 per cent to ₹599.03 crore in the third quarter of this fiscal against ₹444 crore a year ago.

“Covid-related provisions as of December 31, 2020, stood at ₹1,279 crore,” the bank said in a statement on Monday.

One-time restructuring

In accordance with the Resolution Framework for Covid-19 announced by the RBI on August 6, 2020, as of December 31, 2020, the bank has approved, for certain eligible borrowers, one-time restructuring of 0.28 per cent of net advances, it further said. This is roughly ₹600 crore.

As of December 31, 2020, gross non-performing assets was 2.26 per cent and net NPA was 0.50 per cent.

Had the bank classified the borrowers more than 90 days overdue on December 31, 2020, as NPA, gross NPA would be 3.27 per cent (September 30, 2020: 2.70 per cent); net NPA would be 1.24 per cent (September 30, 2020: 0.74 per cent), it further said, adding that it has made provision for such advances, including towards interest accrued but not collected for the entire period, with moratorium.

The bank remained cautious in lending. Advances declined marginally to ₹2,14,103 crore as at December 31, 2020, from ₹2,16,774 crore as of December 31, 2019. Average savings deposits grew by 29 per cent to ₹1,07,363 crore for the nine months of 2020-21 compared to ₹83,049 crore in the corresponding period a year ago.

Jaimin Bhatt, Group President and Group Chief Financial Officer, Kotak Mahindra Bank, said there has been growth in segments such as home loan, consumer secured businesses and tractors. It is going slow in unsecured consumer loans, he told reporters.

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IDRBT gets new director – The Hindu BusinessLine

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D Janakiram has taken over as the new director of the Institute for Development and Research in Banking Technology (IDRBT), an arm of Reserve Bank of India.

Before joining IDRBT, he was a senior professor of computer science and engineering department, IIT Madras. He was also a Visiting Professor at the Rochester Institute of Technology (RIT) in the USA.

His current research focusses on building large scale distributed systems and challenges in big data processing and cloud computing and blockchain technologies.

”Janakiram brings with him immense experience in various fields of direct relevance to Banking and Financial Technology,’’ IDRBT said in a release issued on Monday.

A PhD from IIT Delhi, he was awarded the Boyscast Fellowship in 1997, the IBM Faculty Award in 2007 and Yahoo Faculty Grant in 2009. Having wrote over 150 research papers, Janakiram is the editor of six books. He authored on Grid Computing, Building Large Scale Software Systems and Grid and Cloud Computing.

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Net profit rises 16% to Rs 1,853.5 crore; NII up 17%, BFSI News, ET BFSI

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MUMABI: Kotak Mahindra Bank today reported a net profit of Rs 1,853.5 crore as against Rs 1,595.90 crore, reflecting a growth of 16 per cent on a year-on-year basis.

The lender reported a gross non-performing assets ratio of 2.26 per cent for the reported quarter as against 2.55 per cent in the previous quarter.

Notwithstanding the Supreme Court’s standstill on bad loan recognition, the lender said that the gross NPA ratio would have stood at 3.27 per cent in the December quarter and net NPA ratio would have been at 1.24 per cent.

The lender’s net interest income rose 17 per cent on year to Rs 4,007 crore, while the net interest margin was largely stable on year at 4.51 per cent.

The private sector bank reported a 4.5 per cent sequential growth in advances in the quarter to Rs 2.14 lakh crore, which fared better than most peers who have reported earnings so far. However, on a year-on-year basis the lender’s loan book fell 1.2 per cent reflecting the conservative strategy adopted by the bank since onset COVID-19 pandemic.

Kotak Bank said that its Covid-related provisions stood at Rs 1,279 crore as on December 31, while it has approved restructure of loans under the special recast window provided by the Reserve Bank of India to the tune 0.28 per cent of net advances.

The bank said that proforma net non-performing assets at the end of the December quarter stood at Rs 2,646 crore with provisions worth Rs 2,262 crore held against them.

The lender reported strong operating performance in the quarter as the operating profit jumped 29 per cent year-on-year to Rs 3,083 crore.



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Kotak Mahindra Bank Q3 net profit up 16%

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Private sector lender Kotak Mahindra Bank reported a 16.1 per cent increase in its standalone net profit at ₹ 1,853.54 crore for the third quarter this fiscal as against ₹ 1,595.90 crore in the same period last fiscal.

Net interest income for the quarter ended December 31, 2020 rose by 17 per cent to ₹ 4,007 crore, from ₹ 3,430 crore a year ago. Net interest margin for the quarter under review was at 4.51 per cent.

Other income was almost flat at ₹ 1,334.38 crore (₹ 1,341.43 crore).

Provisions soared by 34.9 per cent to ₹ 599.03 crore in the third quarter this fiscal as against ₹ 444 crore a year ago.

“Covid related provisions as at December 31, 2020 stood at ₹ 1,279 crore,” the bank said in a statement on Monday.

In accordance with the Resolution Framework for Covid-19 announced by RBI on August 6, 2020, as at December 31, 2020, the bank has approved, for certain eligible borrowers, one-time restructuring of 0.28 per cent of net advances, it further said.

As at December 31, 2020, gross non performing assets was 2.26 per cent and net NPA was 0.50 per cent.

Had the bank classified the borrowers more than 90 days overdue on December 31, 2020 as NPA, gross NPA would be 3.27 per cent (September 30, 2020: 2.70 per cent); net NPA would be 1.24 per cent (September 30, 2020: 0.74 per cent), it further said, adding that it has made provision for such advances including towards interest accrued but not collected for the entire period, with moratorium.

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Ruptok Fintech raises ₹10 cr from Canadian investment firm Wurk

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Ruptok Fintech Private Ltd, a fintech-platform for gold loans, has raised ₹10 crore in an Angel funding round from Canadian investment firm Wurk.

The company will use the funding to fuel up its business and operations in Jaipur and Mumbai by March , and to acquire manpower, the company said in a statement.

“During the pandemic, we have witnessed several people facing liquidity crunch and selling their assets to accomplish their financial needs. Our idea behind launching Ruptok last year was to offer an easy financing options to the customers at the comfort of their doorstep,” Ankur Gupta, Founder and CEO of Ruptok Fintech, said.

Founded in July 2020 by serial entrepreneur Ankur Gupta and Akshita Gupta (Head HR) and Yashwardhan Aeren (Head Product Development), Ruptok provides instant loans against gold jewellery within 30 minutes.

“Indian fintech market has witnessed a tremendous growth trajectory in past few years, especially during pandemic. The global crisis has brought a fundamental shift in consumers’ behaviour and preferring most of the services at their doorstep. At present, the market is attracting a pool of innovative ideas and distinctive solutions to address the core solutions of the consumers by providing the utmost convenience,” Barbara Holding, a Wurk spokesperson, said.

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PMC Bank revival: Phased deposit withdrawal likely for customers

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Harried depositors of the scam-hit Punjab and Maharashtra Co-operative (PMC) Bank may be allowed to withdraw deposits in a phased manner, spread over 4-5 years, if it gets revived by an equity investor/ group of investors.

Such a move will assure the investor of a relatively stable liability base (deposits) even as the new management goes about mobilising fresh deposits, in all probability under a new brand name, according to sources aware of the modalities of the revival plan.

While the principal withdrawal could be in tranches of either 20 per cent of outstanding deposit each year over the next five years or 25 per cent over the next four years, existing depositors are likely to be allowed unfettered access to the accrued interest.

“If depositors can withdraw the interest on deposits, they can get on with their lives.

“Senior citizens, who depended on interest income on deposits to meet monthly expenses, have faced untold misery ever since the Bank was put under RBI Directions in September 2019,” said a depositor.

Currently, deposit withdrawals are capped at ₹ 1 lakh per depositor for the entire duration of the Directions.

ALSO READ Investors given time till Feb 1 to submit final bids for PMC Bank

Potential investors

Potential investors who have submitted expression of interest (EoI) to invest in the Bank include the Centrum Group-BharatPe combine and the UK-based Liberty Group.

RBI is likely to announce the name of the investor who will steer the fortunes of the Bank before the extended validity period of its Directions ends on March 31, 2021.

If PMC Bank revives with the help of an investor, it can serve as a template for the revival of other distressed urban co-operative banks.

The Directions against PMC Bank were necessitated as RBI came across a nexus between borrowers (promoters of a real estate group) and some Bank officials, with the alleged fraud/ financial irregularities pegged at about ₹4,355 crore.

ALSO READ RBI extends restrictions on PMC Bank to March

Conversion into SFB

AK Dixit, PMC Bank’s Administrator, in a letter to customers and stakeholders, said: “As you are aware, the bank had issued EoI on November 03, 2020, inviting investors for revival/ reconstruction of PMC Bank.

“Initially, four investors had shown their interest. Further process has been undertaken by three of them.”

As per the EoI, subsequent to commencement of the normal day-to-day operations, it will be open for the investor(s) to convert the bank into a Small Finance Bank by making an application to RBI.

“The investor(s) should ideally bring in the capital required for enabling the bank to achieve the minimum required capital to risk weighted assets ratio (CRAR) of 9 per cent.

“However, the investors may explore the option of restructuring a part of deposit liabilities into capital/capital instruments,” the EoI said.

The bank may also approach the Deposit Insurance and Credit Guarantee Corporation (DICGC) for its support for payment up to ₹ 5 lakh (insured deposits) to depositors under the provisions of the DICGC Act, 1961, it added.

According to the EoI, PMC Bank was having total deposits of ₹ 10,727.12 crore, total advances of ₹ 4,472.78 crore and gross NPA (non-performing assets) of ₹ 3,518.89 crore as on March 31, 2020. Further, the share capital of the bank is ₹ 292.94 crore. However, the bank registered a net loss of ₹6,835 crore during 2019-20 and has a negative net worth of ₹ 5,850.61 crore.

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YES Bank: ED raids Omkar Realtors in money laundering case

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The Enforcement Directorate on Monday conducted raids on at least 10 premises of a Mumbai-based realty group in connection with its money laundering probe in the YES Bank alleged bank fraud case, official sources said.

They said premises of Omkar Realtors and Developers, that includes seven residential and three official in Mumbai, were searched by the central probe agency.

Emails sent by PTI to the realty group did not elicit a response. The action is being carried out under the Prevention of Money Laundering Act (PMLA) and the raids are aimed at gathering more evidence, they said.

Also read: Cox & Kings: A tale of plunder

The Omkar Group is promoted by its chairman Kamal Kishore Gupta and Managing Director Babulal Varma, they said.

The group is alleged to have misused various permissions given under the slum rehabilitation authority (SRA) schemes and is alleged to have “diverted” around ₹450 crore taken by way of loan from YES Bank, ED sources said.

YES Bank co-promoter Rana Kapoor and and DHFL promoters Kapil Wadhawan and Dheeraj Wadhawan were arrested in this case by the ED last year and they are in judicial custody at present. The ED had booked Kapoor, his family members and others under the PMLA after studying a CBI FIR that alleged that dubious multi-crore loans were given by YES Bank to various entities in contravention of the law and in lieu of purported kickbacks given to the Kapoor family.

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‘We have not sold a single loan to any ARC’

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The turnaround for YES Bank has been much faster as it could usually take at least two to three years, believes Prashant Kumar, Managing Director and CEO, YES Bank. In an interview with BusinessLine, Kumar said the bank is hoping to continue with the growth in advances in the fourth quarter with good demand from retail and MSME segments. Edited excerpts:

How has the bank managed such a robust growth in net interest income?

Some of the recovery has been booked as interest income, which has given a boost to the NII. This robust growth in NII will continue but it will depend on whether you will make recovery for interest. This may not happen in all the cases; normally there is always a haircut.

How is the growth in advances?

We had set a target of ₹10,000 crore of disbursements in the third quarter for retail and MSMEs and we disbursed ₹12,000 crore. Corporate disbursements were at ₹2,000 crore. We are seeing demand from the retail and MSME segments but corporate demand is yet to pick up.

We were earlier lending to large project finance companies on the corporate side but we are not doing that as a strategy now as we don’t have that kind of size of balance sheet. But we will definitely participate in working capital requirement and small requirement of term loans like ₹300 crore on the corporate side but not very large. Aviation, hospitality and real estate have been impacted badly by the pandemic as well as sectors related to entertainment, and shopping malls.

For the fourth quarter, we have not kept a target on advances but would like to do the same as the third quarter.

Also read: This is the peak in terms of NPAs and slippages: YES Bank chief

How have operating expenses come down?

We are avoiding wasteful expenses. Due to the pandemic, we realised people can work from home. In our Mumbai building, we have vacated two floors from 12 floors and will be in a position to vacate another two floors in the coming months. Similarly, in Delhi, we have shifted our premises from Chanakyapuri and are moving to Noida.

So, will the bank go for branch expansion?

In terms of business growth, we need to expand the branch network. Till now, our branches have been concentrated largely in northern and western India. Our presence in southern, eastern and central India is very small. We need to wait for two to three quarters but we are coming out with a strategy of opening branches in the areas where we are not there. Branch expansion will be a part of the strategy but we need to wait and see the real impact of the pandemic.

Also read: YES Bank posts Q3 net of ₹151 crore

What about deposit mobilisation?

Growth on deposits is always a slow process. Earlier, YES Bank’s deposit was at ₹2-lakh crore plus. But at that time, there was a very large deposit book of the government, which has come down. Some States are not placing deposits with private sector banks and we are also not getting deposits from the Central government. The government deposit book was ₹45,000 crore but now it is only at ₹7,000 crore to ₹8,000 crore. On retail and corporate deposit book, we are back on track. Our focus will be to open CASA accounts.

What is happening on the bad bank proposal? Are you looking to sell off any NPAs?

We are waiting for regulatory approvals. We have not sold a single loan to any ARC (asset reconstruction company) and we have no plans. If we are able to set up our own ARC, then we will transfer it to our own ARC. Selling doesn’t make any sense, it brings in hardly 20 per cent. We are able to recover much more.

What are your expectations from the Budget?

Real estate has been impacted by Covid-19 and has been under difficulties in the last three to four years. Addressing this sector is important as a large number of people are also impacted. People are paying EMIs but not getting their flats. This sector, if taken care, will give a boost to infrastructure. Banks would be able to recover their loans and the government will also get huge taxes. Also, hopefully the Budget will continue to provide support to MSMEs. It has a big role in the GDP and needs support in terms of releasing payments, protection, and ease of doing business.

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Paytm Insider launches ‘Shoutouts’ to let people gift personalised celebrity video message

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Paytm Insider, an entertainment platform to discover and find tickets, augments its new feature, Shoutouts, where one can now book a personalised video message for their friends and acquaintances from their favorite celebrities across multiple creative circuits.

The multiple genres of artists include popular influencers, actors, music artists, sports personalities, comedy artists, RJs, celebrity lookalikes, poets’ models, among others, as per the official release.

Some of the renowned celebrities on the platform include comedy artists like Kaneez Surka, Atul Khatri, Supaarwoman, Ahsaan Qureshi, Upasana Singh, Kumar Varun.

The feature also includes music artists and actors like Sreerama Chandra, Florence Vohera, Sultaan, Hiten Tejwani, Delnaaz Irani, Sharman Joshi, among many others.

Also read: Paytm Money launches F&O trading at ₹10 per order

Paytm Insider has collaborated with OML, Kommune, Wysh, and Bandage Talent Agency Pvt Ltd to roll out this feature.

To avail it, one needs to select the artist, specify the details such as the occasion and the recipient’s name, and they will receive the message via email within the specified time.

Speaking on the new feature, Shreyas Srinivasan, CEO of Paytm Insider, said in the official release: “With Shoutouts, we’re making the important days of your life even more special by adding the celebrity touch to them. Be it your friends, family, or your team, you can now deliver your messages through their favorite artists. There’s nothing quite as cherished as personalized gifts, and this is definitely taking it to the next level. Leave them grateful and starstruck with a Paytm Insider Shoutout!”

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