Punjab & Sind Bank Q2 rises 25.29% sequentially

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Punjab & Sind Bank (PSB) on Monday reported a net profit of ₹218 crore for the quarter-ended September 30 as against a net loss of ₹401 crore in the same quarter last fiscal.

On a sequential basis, net profit for the quarter under view grew 25.29 per cent as compared to net profit of ₹174 crore in the first quarter this fiscal.

S Krishnan, Managing Director & CEO, PSB expressed confidence that the public sector lender will be able to sustain this bottomline performance in the subsequent quarters as well.

Operating profit rises

Operating profit of the bank for the quarter increased 20.29 per cent to ₹249 crore as compared to ₹207 crore in the same quarter last fiscal.

Gross non performing assets stood at ₹9,823 crore as on September-end 2021 as against ₹9,055 crore in June-end 2021. It stood at ₹8,673 crore as on September 2020.

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HDFC reports 31.7% jump in standalone net profit in Q2

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Housing Development Finance Corporation (HDFC) Ltd on Monday reported a 31.7 per cent jump in its standalone net profit for the second quarter of the fiscal, led by higher dividend income as well as a drop in expenses.

It said that the individual approvals and disbursements grew by 67 per cent and 80 per cent, respectively, during the half-year ended September 30, 2021 compared to the corresponding period in the previous year. “Individual disbursements in the month of October 21 were the highest ever in a non-quarter end month,” it further said.

Spike in total income

For the quarter ended September 30, HDFC had a standalone net profit of ₹3,780.5 compared to ₹2,870.12 crore in the corresponding quarter last fiscal. Its total income increased by 4.2 per cent to ₹12,226.39 crore in the second quarter of the fiscal as against ₹11,732.70 crore in the same period last fiscal.

The net interest income for second quarter of the fiscal rose by 13 per cent to ₹4,108.51 crore from ₹3,646.54 crore a year ago. The net interest margin was 3.6 per cent for the quarter under review as against 3.7 per cent for the first quarter of the fiscal. Dividend income shot up to ₹1,171.26 crore in the July to September 2021 from ₹322.97 crore a year ago.

Home loans demand

“The demand for home loans continues to remain strong. Growth in home loans was seen in both the affordable housing segment as well as in high end properties. The increasing sales momentum and new project launches augurs well for the housing sector,” HDFC said in a statement on Monday.

The collection efficiency for individual loans on a cumulative basis improved to stand at over 98 per cent during the quarter ended September 30. The provisions as at September 30, 2021 stood at ₹13,340 crore

As per regulatory norms, the gross non-performing loans as at September 30, 2021 stood at ₹10,341 crore. This is equivalent to 2 per cent of the loan portfolio compared to 2.24 per cent as on June 30, 2021.

Expected credit loss was ₹452 crore for the second quarter of the fiscal, marginally higher than ₹436 crore a year ago. This was however, a 34.1 per cent drop from the expected credit loss of ₹686 crore as of June 30, 2021.

As at September 30, 2021, loans restructured under the RBI’s resolution framework for Covid-19 related stress (OTR 1 and 2.0) was equivalent to 1.4 per cent of the loan book compared to 0.9 per cent as at June 30, 2021.

Of the loans restructured, 63 per cent are individual loans and 37 per cent are non-individual loans. Of the total restructured loans, 35 per cent is in respect of just one account. Assets under management increased by 10.6 per cent to ₹5.97-lakh crore as of September 30 from ₹5.4-lakh crore a year ago.

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Yes Bank appoints Sharad Sharma as Non-Executive Director

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Yes Bank has co-opted Sharad Sharma as Non-Executive Director on its board of directors.

The appointment is with effect from November 1 and will help broad base the board, it said in a statement on Monday.

Sharma is a career banker with forty years of banking experience. He was the Managing Director of State Bank of Mysore from August 2012 to April 2016, where he was seconded from State Bank of India.

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RBI approves Bandhan Bank as ‘agency bank’ to conduct govt biz

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The Reserve Bank of India (RBI) has authorised Bandhan Bank as an agency bank for undertaking government business. With this, the bank joins ranks with a few other scheduled private sector banks to be empanelled as agency banks of the RBI.

The announcement comes close on the heels of a RBI guideline earlier in May this year that authorises scheduled private sector banks as agency banks of the regulator for the conduct of government business.

The guidelines were revised by the Central bank following the lifting of embargo put in place by Department of Financial Services, Ministry of Finance in 2012 on further allocation of government business to private sector banks through a communication dated February 24, 2021.

Handle transactions

As an agency bank of the RBI, Bandhan Bank will be able to handle transactions related to collection of State taxes and revenue receipts such as GST and VAT, collection of stamp duty and pension payments on behalf of the Central and the State governments.

The bank’s extensive branch network, especially in rural and semi-urban areas, and its digital banking capabilities would help bring governments and citizens closer to each other, the bank said in a press statement.

“The RBI’s decision will further help us contribute to nation-building and we thank the RBI for this approval. Bandhan Bank enjoys the trust of over 2.4 crore customers. We now have the opportunity to serve the government with our banking services,” Chandra Shekhar Ghosh, MD & CEO, Bandhan Bank said in the statement.

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SBI launches video call life certificate submission facility for pensioners

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State Bank of India (SBI) has launched a Video Life Certificate (VLC) facility for pensioners.

With this facility, pensioners can schedule a video call with SBI staff at their convenience and complete the process of life certificate submission without having to visit the bank branch, India’s largest bank said in a statement.

Pensioners have to log on to www.pensionseva.sbi, click on ‘Video LC’ and enter their SBI pension account number. They will have to submit the OTP received on their registered mobile numbers.

After reading the terms and conditions, pensioners can click on ‘Start Journey’.

“Pensioners will have to keep their original PAN card in place, click on ‘I am ready’ and grant permission to start the video call,” the Bank said.

Dinesh Khara, Chairman, SBI said, “We believe this facility will digitally empower pensioners and enable them to submit their life certificates without any hassle of visiting the branch amid Covid-19. ”

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Centrum-BharatPe backed Unity SFB commences operations

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The Reserve Bank of India on Monday said Unity Small Finance Bank (Unity SFB) Ltd has commenced operations as a small finance bank (SFB) with effect from November 1.

Unity SFB, which has been jointly established by the Centrum Financial Services Ltd (CFSL) and Resilient Innovations Private Limited (BharatPe) to carry on SFB business in India, was granted banking licence by RBI on October 13.

“The bank, which will be a digital first bank, commences operations with Centrum’s MSME and micro finance businesses and teams that has a capital infusion of about ₹1,100 crore, total assets worth ₹2,400 crore, active customer base of over 2 lakh, 145 offices including a branch in Centrum House, Mumbai,” said Centrum Group and BharatPe in a joint statement.

‘Tech-first products’

Jaspal Bindra, Executive Chairman, Centrum Group, said, “We aim to make it a truly new age bank. The bank is well capitalised, significantly higher than the minimum regulatory requirement (of ₹200 crore), giving us the platform to build a robust technological infrastructure, hire the best talent and work with credible vendor partners.”

Ashneer Grover, Co-Founder and Managing Director, BharatPe, said that with the capitalisation and approvals in place, Unity SFB will now focus on building tech-first products. RBI had accorded “in-principle” approval to CFSL, a wholly owned subsidiary of Centrum Capital, on June 18 to set up a SFB.

The aforementioned approval was in specific pursuance to CFSL’s February 2021 offer in response to the scam-hit Punjab and Maharashtra Co-operative (PMC) bank’s November 2020 Expression of Interestnotification.

Amalgamation process

The grant of banking licence to Unity SFB and commencement of its operations sets the stage for RBI to place in the public domain a draft scheme of amalgamation of PMC Bank with the SFB. The last step will be the government’s sanction for the scheme.

Bindra expects the amalgamation to be complete by next month-end. This development should warm the distressed hearts of PMC bank depositors. They have been struggling to get their deposits back for more than two years amid the Covid-19 pandemic.

Once CFSL takes over PMC bank, it would get a ready-made branch network of about 100 branches in Mumbai and in a few States. CFSL provides credit to small and mid-size companies.

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Insurance claim liable to be rejected if lapsed on account of non-payment of premium: SC

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An insurance claim can be rejected if the policy has lapsed on account of non-payment of premium, said the Supreme Court which stressed that the terms of an insurance policy have to be strictly interpreted.

The apex court observation came while setting aside an order of the National Consumer Disputes Redressal Commission (NCDRC) that ordered additional compensation in a road accident case.

A bench of Justices Sanjiv Khanna and Bela M Trivedi said it is a well-settled legal position that in a contract of insurance there is a requirement of Uberrima fides i.e. good faith on the part of the insured.

“It is clear that the terms of insurance policy have to be strictly construed, and it is not permissible to rewrite the contract while interpreting the terms of the policy,” the bench said.

The top court was hearing an appeal filed by the Life Insurance Corporation (LIC) against the judgement of the NCDRC that had set aside the order passed by the State Commission.

In the case, the woman’s husband had taken a life insurance policy under the Jeevan Suraksha Yojana from the Life Insurance Corporation under which a sum of . ₹3.75 lakh was assured by LIC.

Besides this amount, in case of death by accident an additional sum of ₹3.75 lakh was also assured.

The insurance premium of the said policy was to be paid six-monthly, however, there was a default in payment.

On March 6, 2012, the husband of the complainant met with an accident and succumbed to the injuries on March 21, 2012.

The complainant after the death of her husband filed a claim before LIC and was paid a sum of ₹3.75 lakh to her. However, the additional sum of ₹3.75 lakh towards the Accident claim benefit was denied.

The complainant, therefore, approached the District Forum by filing a complaint seeking the said amount towards the Accident claim benefit. The District Forum allowed the appeal of the woman and directed the payment of an additional sum of ₹3.75 lakh towards the Accident claim benefit.

The State Consumer Disputes Redressal Commission set aside the order which was further challenged in the National Consumer Disputes Redressal Commission.

The NCDRC set aside the order passed by the State Commission.

The apex court said in the instant case, condition no. 11 of the policy stipulated that the policy has to be in force when the accident takes place.

“In the instant case, the policy had lapsed on October 14, 2011, and was not in force on the date of accident i.e. on March 6, 2012. It was sought to be revived on March 9, 2012, after the accident in question, and that too without disclosing the fact of the accident which had taken place on March 6, 2012,” the apex court said in its October 29 order.

The top court said apart from the fact that the complainant had not come with clean hands to claim the add on/extra Accident benefit of the policy, the policy in question was not in force on the date of the accident as per condition no. 11 of the policy, the claim for extra Accident benefit was rightly rejected by the Corporation.

“Since clause 3 of the said terms and conditions of the policy permitted the renewal of the discontinued policy, the appellant-Corporation had revived the policy of complainant by accepting the payment of premium after the due date and paid ₹3,75,000 as assured under the policy, nonetheless for the Accident benefit, the policy had to be in force for the full sum assured on the date of accident as per the said condition no. 11,” the bench said.

The apex court said the accident benefit could have been claimed and availed of only if the accident had taken place after the renewal of the policy.

“The Court, therefore, is of the opinion that the impugned order passed by the NCDRC setting aside the order passed by the Commission and reviving the order passed by the District Forum was highly erroneous and liable to be set aside,” the bench said.

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Aditya Birla Capital reports 43% jump in Q2 net profit

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Aditya Birla Capital reported a 42.6 per cent surge in its consolidated net profit to ₹376.9 crore in the second quarter of the fiscal, led by robust growth in revenue. Its net profit was ₹264.34 crore in the corresponding quarter of last fiscal.

This was its highest ever consolidated quarterly profit.

For the quarter ended September 30, total revenue from operations rose by 21.7 per cent to ₹5,593.22 crore from ₹4,595.17 crore in the same period last year.

Also see: Primary market to sparkle with IPOs worth over ₹30,000 crore in November

“The company, through its subsidiaries, continues to maintain its track record of delivering strong performance through market and macroeconomic cycles, backed by its diversified business model,” it said in a statement on Monday.

Its retailisation strategy has led to the active customer base growing by 42 per cent year-on-year to about 2.8 crore.

Rise in AUM

Overall assets under management across asset management, life insurance and health insurance businesses grew 24 per cent-year on year, to over ₹3,70,290 crore.

The overall lending book (NBFC and housing finance) was ₹59,060 crore as of September 30.

The gross premium across life and health insurance for the half year grew 25 per cent year-on-year to ₹5,685 crore.

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Muthoot Finance launches ‘special Diwali Dhamaka’ campaign

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Muthoot Finance has launched a ‘special Diwali Dhamaka Campaign’ offering gold loans at a low interest rate of just 57 paisa per month (calculated for ease on a ₹100 gold loan) or 6.90 per cent per annum.

The unique and limited period offer comes with a host of other value-added benefits such as maximum loan value, no processing charges, no pre-payment or part payment fees, etc.

The purpose of the campaign is to get maximum first-time loan seekers to avail gold loans and help them meet their objectives. The campaign aims to encourage everyone, particularly hesitant first-time loan seekers to avail gold loans convincingly from India’s Gold Loan Specialist – Muthoot Finance.

Abhinav Iyer, General Manager, Marketing & Strategy, The Muthoot Group, said, “With over 25,000 tonnes of gold stocked in Indian households and less than 5 per cent of this being monetised by way of gold loans, I feel there is tremendous opportunity to unlock the latent potential of this emotional currency to turbo-charge economic growth and realise our government’s vision of Atmanirbhar Bharat.”

Muthoot Finance has seen healthy demand for gold loans and there is optimism about rising consumer confidence in the festive season. “With gradual improvement in the economic situation, much can be attributed to pent-up demand after almost 18 months of pandemic-led lull,” he said.

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Former SBI Chairman Pratip Chaudhuri arrested in loan scam case

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Former State Bank of India Chairman Pratip Chaudhuri was arrested on Sunday from his Delhi home in a case related to a hotel group in Jaisalmer.

The case is related to a hotel property owned by Godawan group that SBI seized after it was declared as a nonperforming asset (NPA). It is learnt that the loan amount involved in 2008 was ₹24 crore.

It maybe recalled that Chaudhuri had assumed charge as SBI Chairman on April 7, 2011 and retired on September 30, 2013.

Chaudhuri was arrested by Jaisalmer police on Sunday on the basis of arrest orders issued by the Chief Judicial Magistrate Court at Jaisalmer. The hotel property of Godawan Group was seized in lieu of the loan extended by SBI. Pratip Chaudhuri was the Chairman of SBI at that time when the property was seized.

With SBI selling the confiscated property in 2016 to Alchemist ARC, an asset reconstruction company, the hotel group went to court claiming that the bank transferred the property to ARC at much lower rate than the then prevailing market rate.

Interestingly, Chaudhuri had after retirement joined the Alchemist ARC company as director.

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