Tag: lakshmi vilas bank

Corporate exclusion from banking shrinks buyer pool for PSBs, BFSI News, ET BFSI

Banking & Finance

[ad_1]

Read More/Less


The Reserve Bank of India’s decision to keep corporates away from bank licences will help the government sidestep allegations that it is selling banks to big business. However, the number of prospective buyers for public sector banks (PSBs) will shrink.

In the absence of any deep-pocketed corporate house, the bidders for PSU banks would have to be either private or multinational banks, or private equity investors who would be in a position to come up with a couple of billion dollars to buy a bank. The challenge in the case of private equity investors is that they would look for an exit after a few years, while multinational banks are increasingly reducing their retail exposure as retail banking is becoming a domestic activity because of compliance costs.

Private players like HDFC Bank, Kotak, ICICI and Axis have the equity-raising capacity, but the pension liabilities would be a deterrent. In March this year, finance minister Nirmala Sitharaman had said that the salary and pension of bank employees will be protected in the case of privatisation. “The deal-breaker would be the pension liabilities of these banks,” said a private banker. The fact that the pension is inflation-linked makes it worse for any buyer.

The source added that this is the reason why the banks are trading at low valuations despite having cleaned up their loan books.

For private banks, a bank licence or a branch network does have the same appeal that it would have for a corporate house. More so given the disruption that digital is causing. “Unlike in the past when a domestic bank licence would draw a lot of interest, there was only one serious bidder for Lakshmi Vilas Bank — DBS. When the RBI was looking for someone to take over PMC Bank, despite the lure of a licence of a Mumbai-headquartered bank, there was again only one bidder,” pointed out a banker.

While the PSBs are in better financial shape, a buyer would need to put in more capital and probably see a hike in the cost of funds as the government ownership, which provides a cushion to depositors, will no longer be there. Since liberalisation, the central bank has taken the safe route of issuing bank licences to financial institutions. The first round of banks that got their licence was largely sponsored by financial institutions, including HDFC, ICICI, UTI, IDBI and some non-banking finance companies such as Centurion, Kotak Mahindra and Bandhan. The experience in granting licences to professionals has not been good (Global Trust Bank and Yes Bank). The absence of private non-bank financial institutions makes the divestment more challenging.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , , , ,

Here are the top 5 bank fixed deposit interest rates, BFSI News, ET BFSI

Personal Finance

[ad_1]

Read More/Less


The fixed deposit (FD) is one of the most popular investment avenues. Many investors prefer bank FDs over equities as the former are considered safe. The return earned from a bank FD is fixed and known at the time of investing unlike in case of equity.

Fixed deposits are also known as term deposits. This is because money is deposited with a bank for a fixed predetermined time period or term. Here are certain things that you must know while opening an FD account.

You can open a term deposit account with a bank where one already has a savings account. Some banks may allow you to open an FD account without having to open a savings bank account. However, you will be required to undergo a know-your-customer (KYC) process in case the bank allows you to place an FD without a savings account. You will be asked to provide self-attested photocopies of ID proof such as PAN, address proof such as Aadhaar, Voter ID card, passport etc. and coloured passport size photographs. You will be required to show the original documents which will be returned immediately post-verification.

  • Minimum and maximum investment amount

The minimum amount needed to open a fixed deposit account varies from bank to bank. However, there is no limit on the maximum amount which one can invest in an FD.The minimum and maximum tenure offered for which an FD can be placed varies from one bank to another. Usually, one can invest in FD for a minimum period of 7 days and for a maximum of 10 years. You can choose the period for which you wish to keep your FD as per your requirement.

Top 5 bank fixed deposit interest rates
Tenure: 1 year

Bank Name Interest rate (%) Compounded qtrly What Rs 10,000 will grow into
Indusind Bank 6.00 10613.64
RBL Bank 6.00 10613.64
DCB Bank 5.55 10566.66
Bandhan Bank 5.50 10561.45
South Indian Bank 5.40 10551.03

Tenure: 2 years

Bank Name Interest rate (%) Compounded qtrly What Rs 10,000 will grow into
Indusind Bank 6.00 11264.93
RBL Bank 6.00 11264.93
Bandhan Bank 5.50 11154.42
DCB Bank 5.50 11154.42
Karur Vysya Bank 5.50 11154.42

Tenure: 3 years

Bank Name Interest rate (%) Compounded qtrly What Rs 10,000 will grow into
RBL Bank 6.30 12062.63
Indusind Bank 6.00 11956.18
DCB Bank 5.95 11938.52
Karur Vysya Bank 5.50 11780.68
South Indian Bank 5.50 11780.68

Tenure: 5 years

Bank Name Interest rate (%) Compounded qtrly What Rs 10,000 will grow into
RBL Bank 6.30 13669.00
Indusind Bank 6.00 13468.55
DCB Bank 5.95 13435.42
Axis Bank 5.75 13303.65
Karur Vysya Bank 5.75 13303.65

All data sourced from Economic Times Intelligence Group (ETIG)
Data as on September 24, 2021The interest rate offered on fixed deposits (FDs) will depend on the period for which you are investing in the FD and also vary from bank to bank for FDs for the same tenure. Senior citizens are typically offered higher interest rates. To receive the interest payment, you can choose either cumulative option or non-cumulative option.

Under the cumulative option, interest accrued on the deposit is reinvested and paid at the time of maturity along with principal amount.

In the non-cumulative option, interest is credited into the depositors account at the pay-out interval chosen at the time of placing the FD. Generally, one can choose from the options of receiving the interest on monthly, quarterly, half-yearly or annually basis as offered by the bank.

Interest received on FD is fully taxable in the hands of the investor. It will be taxed at the rates applicable to your income tax slabs. TDS will be deducted by the bank if the interest payment in a single financial year exceeds Rs 10,000, as per current tax laws. To avoid TDS, one can submit Form 15G or Form 15H (as applicable) to the bank.In case of any urgent requirements, one can break his/her FD before the maturity date. A penalty may be levied by the bank on premature withdrawals. The penalty amount varies from one bank to another.

While placing a FD, one must check the rules regarding pre-mature withdrawals. Sometimes, banks offer FDs without premature withdrawal facility as well as FDs without penalty on premature withdrawal.

One can use FD as a collateral to obtain a loan. The maximum loan sanctioned is usually a certain percentage of the principal deposit. This percentage may vary bank to bank.Nomination facility for Fixed Deposits (FDs) is also available.At maturity, if no specific instructions are given, most banks automatically renew the FD for the same period for which it was initially placed at the interest rates prevailing on the date the FD matures. If you do not want automatic renewal of your FD, you need to choose this option on the account opening form.

If you have forgotten to mention it, then you can visit the bank branch on the day of maturity and ask them to credit the proceeds into your savings account.

Nowadays banks offer the facility of opening an FD account online via Net banking through your account. One can invest in FD without having to visit a branch physically. However, remember that your bank may not issue you a printed FD receipt/advice if invested online.

Disclaimer: The data/information given above is subject to change therefore before taking any decision based on it, contact the bank/institution concerned.

For any queries or changes, please write to us on etigdb@timesgroup.com or call us at 022 – 66353963.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , , , , ,

Here are the top 5 bank fixed deposit interest rates, BFSI News, ET BFSI

Banking & Finance

[ad_1]

Read More/Less


The fixed deposit (FD) is one of the most popular investment avenues. Many investors prefer bank FDs over equities as the former are considered safe. The return earned from a bank FD is fixed and known at the time of investing unlike in case of equity.

Fixed deposits are also known as term deposits. This is because money is deposited with a bank for a fixed predetermined time period or term. Here are certain things that you must know while opening an FD account.

You can open a term deposit account with a bank where one already has a savings account. Some banks may allow you to open an FD account without having to open a savings bank account. However, you will be required to undergo a know-your-customer (KYC) process in case the bank allows you to place an FD without a savings account. You will be asked to provide self-attested photocopies of ID proof such as PAN, address proof such as Aadhaar, Voter ID card, passport etc. and coloured passport size photographs. You will be required to show the original documents which will be returned immediately post-verification.

  • Minimum and maximum investment amount

The minimum amount needed to open a fixed deposit account varies from bank to bank. However, there is no limit on the maximum amount which one can invest in an FD.The minimum and maximum tenure offered for which an FD can be placed varies from one bank to another. Usually, one can invest in FD for a minimum period of 7 days and for a maximum of 10 years. You can choose the period for which you wish to keep your FD as per your requirement.

Top 5 bank fixed deposit interest rates
Tenure: 1 year

Bank Name Interest rate (%) Compounded qtrly What Rs 10,000 will grow into
RBL Bank 6.10 10624.10
Indusind Bank 6.00 10613.64
DCB Bank 5.55 10566.66
Bandhan Bank 5.50 10561.45
IDFC First Bank 5.50 10561.45

Tenure: 2 years

Bank Name Interest rate (%) Compounded qtrly What Rs 10,000 will grow into
RBL Bank 6.10 11287.14
Indusind Bank 6.00 11264.93
Axis Bank 5.50 11154.42
Bandhan Bank 5.50 11154.42
DCB Bank 5.50 11154.42

Tenure: 3 years

Bank Name Interest rate (%) Compounded qtrly What Rs 10,000 will grow into
RBL Bank 6.30 12062.63
Indusind Bank 6.00 11956.18
DCB Bank 5.95 11938.52
IDFC First Bank 5.75 11868.13
Karnataka Bank 5.50 11780.68

Tenure: 5 years

Bank Name Interest rate (%) Compounded qtrly What Rs 10,000 will grow into
RBL Bank 6.50 13804.20
IDFC First Bank 6.00 13468.55
Indusind Bank 6.00 13468.55
DCB Bank 5.95 13435.42
Axis Bank 5.75 13303.65

All data sourced from Economic Times Intelligence Group (ETIG)
Data as on August 20, 2021The interest rate offered on fixed deposits (FDs) will depend on the period for which you are investing in the FD and also vary from bank to bank for FDs for the same tenure. Senior citizens are typically offered higher interest rates. To receive the interest payment, you can choose either cumulative option or non-cumulative option.

Under the cumulative option, interest accrued on the deposit is reinvested and paid at the time of maturity along with principal amount.

In the non-cumulative option, interest is credited into the depositors account at the pay-out interval chosen at the time of placing the FD. Generally, one can choose from the options of receiving the interest on monthly, quarterly, half-yearly or annually basis as offered by the bank.

Interest received on FD is fully taxable in the hands of the investor. It will be taxed at the rates applicable to your income tax slabs. TDS will be deducted by the bank if the interest payment in a single financial year exceeds Rs 10,000, as per current tax laws. To avoid TDS, one can submit Form 15G or Form 15H (as applicable) to the bank.In case of any urgent requirements, one can break his/her FD before the maturity date. A penalty may be levied by the bank on premature withdrawals. The penalty amount varies from one bank to another.

While placing a FD, one must check the rules regarding pre-mature withdrawals. Sometimes, banks offer FDs without premature withdrawal facility as well as FDs without penalty on premature withdrawal.

One can use FD as a collateral to obtain a loan. The maximum loan sanctioned is usually a certain percentage of the principal deposit. This percentage may vary bank to bank.Nomination facility for Fixed Deposits (FDs) is also available.At maturity, if no specific instructions are given, most banks automatically renew the FD for the same period for which it was initially placed at the interest rates prevailing on the date the FD matures. If you do not want automatic renewal of your FD, you need to choose this option on the account opening form.

If you have forgotten to mention it, then you can visit the bank branch on the day of maturity and ask them to credit the proceeds into your savings account.

Nowadays banks offer the facility of opening an FD account online via Net banking through your account. One can invest in FD without having to visit a branch physically. However, remember that your bank may not issue you a printed FD receipt/advice if invested online.

Disclaimer: The data/information given above is subject to change therefore before taking any decision based on it, contact the bank/institution concerned.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , , , , ,

Here are the top 5 bank fixed deposit interest rates, BFSI News, ET BFSI

Banking & Finance

[ad_1]

Read More/Less


The fixed deposit (FD) is one of the most popular investment avenues. Many investors prefer bank FDs over equities as the former are considered safe. The return earned from a bank FD is fixed and known at the time of investing unlike in case of equity.

Fixed deposits are also known as term deposits. This is because money is deposited with a bank for a fixed predetermined time period or term. Here are certain things that you must know while opening an FD account.

You can open a term deposit account with a bank where one already has a savings account. Some banks may allow you to open an FD account without having to open a savings bank account. However, you will be required to undergo a know-your-customer (KYC) process in case the bank allows you to place an FD without a savings account. You will be asked to provide self-attested photocopies of ID proof such as PAN, address proof such as Aadhaar, Voter ID card, passport etc. and coloured passport size photographs. You will be required to show the original documents which will be returned immediately post-verification.

  • Minimum and maximum investment amount

The minimum amount needed to open a fixed deposit account varies from bank to bank. However, there is no limit on the maximum amount which one can invest in an FD.The minimum and maximum tenure offered for which an FD can be placed varies from one bank to another. Usually, one can invest in FD for a minimum period of 7 days and for a maximum of 10 years. You can choose the period for which you wish to keep your FD as per your requirement.

Top 5 bank fixed deposit interest rates
Tenure: 1 year

Bank Name Interest rate (%) Compounded qtrly What Rs 10,000 will grow into
RBL Bank 6.10 10624.10
DCB Bank 6.00 10613.64
Indusind Bank 6.00 10613.64
Bandhan Bank 5.50 10561.45
IDFC First Bank 5.50 10561.45

Tenure: 2 years

Bank Name Interest rate (%) Compounded qtrly What Rs 10,000 will grow into
RBL Bank 6.10 11287.14
DCB Bank 6.00 11264.93
Indusind Bank 6.00 11264.93
Bandhan Bank 5.50 11154.42
Karur Vysya Bank 5.50 11154.42

Tenure: 3 years

Bank Name Interest rate (%) Compounded qtrly What Rs 10,000 will grow into
DCB Bank 6.50 12134.08
RBL Bank 6.30 12062.63
Indusind Bank 6.00 11956.18
IDFC First Bank 5.75 11868.13
Canara Bank 5.50 11780.68

Tenure: 5 years

Bank Name Interest rate (%) Compounded qtrly What Rs 10,000 will grow into
DCB Bank 6.50 13804.20
RBL Bank 6.50 13804.20
IDFC First Bank 6.00 13468.55
Indusind Bank 6.00 13468.55
Axis Bank 5.75 13303.65

All data sourced from Economic Times Intelligence Group (ETIG)
Data as on August 5, 2021The interest rate offered on fixed deposits (FDs) will depend on the period for which you are investing in the FD and also vary from bank to bank for FDs for the same tenure. Senior citizens are typically offered higher interest rates. To receive the interest payment, you can choose either cumulative option or non-cumulative option.

Under the cumulative option, interest accrued on the deposit is reinvested and paid at the time of maturity along with principal amount.

In the non-cumulative option, interest is credited into the depositors account at the pay-out interval chosen at the time of placing the FD. Generally, one can choose from the options of receiving the interest on monthly, quarterly, half-yearly or annually basis as offered by the bank.

Interest received on FD is fully taxable in the hands of the investor. It will be taxed at the rates applicable to your income tax slabs. TDS will be deducted by the bank if the interest payment in a single financial year exceeds Rs 10,000, as per current tax laws. To avoid TDS, one can submit Form 15G or Form 15H (as applicable) to the bank.In case of any urgent requirements, one can break his/her FD before the maturity date. A penalty may be levied by the bank on premature withdrawals. The penalty amount varies from one bank to another.

While placing a FD, one must check the rules regarding pre-mature withdrawals. Sometimes, banks offer FDs without premature withdrawal facility as well as FDs without penalty on premature withdrawal.

One can use FD as a collateral to obtain a loan. The maximum loan sanctioned is usually a certain percentage of the principal deposit. This percentage may vary bank to bank.Nomination facility for Fixed Deposits (FDs) is also available.At maturity, if no specific instructions are given, most banks automatically renew the FD for the same period for which it was initially placed at the interest rates prevailing on the date the FD matures. If you do not want automatic renewal of your FD, you need to choose this option on the account opening form.

If you have forgotten to mention it, then you can visit the bank branch on the day of maturity and ask them to credit the proceeds into your savings account.

Nowadays banks offer the facility of opening an FD account online via Net banking through your account. One can invest in FD without having to visit a branch physically. However, remember that your bank may not issue you a printed FD receipt/advice if invested online.

Disclaimer: The data/information given above is subject to change therefore before taking any decision based on it, contact the bank/institution concerned.

For any queries or changes, please write to us on etigdb@timesgroup.com or call us at 022 – 66353963.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , , , , ,

DBS tops Forbes ‘World’s Best Banks’ list in India, BFSI News, ET BFSI

Banking & Finance

[ad_1]

Read More/Less


DBS has been named by Forbes in their list of World’s Best Banks 2021. DBS was ranked #1 out of 30 domestic and international banks in India for the second consecutive year. This is the third edition of the ‘World’s Best Banks’ list by Forbes, conducted in partnership with market research firm Statista. Over 43,000 banking customers across the globe were surveyed on their current and former banking relationships. The customer survey rated banks on general satisfaction and key attributes like trust, digital services, financial advice, and fees.

“This year’s list includes a record number of award winners, reflecting consumers’ increasing confidence in their banks,” revealed Forbes in its official announcement. Commenting on the recognition, Surojit Shome, Managing Director and CEO, DBS Bank India, said, “We are humbled and proud to be featured on the ‘World’s Best Banks’ list for the second consecutive year. Over the years, we have built a strong customer-centric franchise, and this recognition shines the light on the resilience and a strong sense of purpose demonstrated by our employees to support customers amid the global crisis. We will continue to deepen customer relationships and build journeys that proactively address their needs.”

Felix Kapel, Lead Analyst at Statista for the World’s Best Banks project, said, “DBS India excels in multiple sub-dimensions. The general satisfaction and customer recommendation of DBS is great. These factors have helped DBS retain the No.1 spot in India.”

Recently, DBS Bank India was recognised as ‘India’s Best International Bank 2021’ by Asiamoney. DBS was named ‘Safest Bank in Asia’ for the 12th consecutive year by New York-based trade publication Global Finance in 2020. The bank was also Global Finance’s pick for ‘Best Bank in the World’ in the same year, making it the third consecutive global Best Bank accolade received by DBS. Previously, DBS was named ‘World’s Best Bank’ by leading financial publication Euromoney in 2019. DBS Bank has been present in India for 26 years and has grown consistently by strengthening its small and medium-sized enterprise business and consumer lending operations to build scale and become a full-service bank. Further, it has showcased a long-term commitment to India with the establishment of its local wholly-owned subsidiary, DBS Bank India Limited (DBIL) and the recent acquisition of Lakshmi Vilas Bank.

The amalgamation of Lakshmi Vilas Bank with DBIL in November 2020 bolstered the bank’s physical presence in the country. DBS now has a network of nearly 600 branches across 19 states in India. To view the complete Forbes list, visit https://www.forbes.com/worlds-best-banks/#5c1a16312951 About DBS DBS is a leading financial services group in Asia with a presence in 18 markets. Recognised for its global leadership, DBS has been named “World’s Best Bank” by Euromoney, “Global Banks of the Year” by The Banker and “Best Bank in the World” by Global Finance.

DBS was also ranked No 1 in India by Forbes in its 2020 list of the World’s Best Banks. DBS Bank has been present in India for 26 years, having opened its first office in Mumbai in 1994. DBS Bank India Limited is the first among the large foreign banks in India to start operating as a wholly-owned, locally incorporated subsidiary of a leading global bank. DBS provides an entire range of banking services for large, medium and small enterprises and individual consumers in India. In 2016, DBS launched India’s first mobile-only bank – digibank, which now has ~1 million savings accounts. In November 2020, Lakshmi Vilas Bank was amalgamated with DBS Bank India Limited.

The bank now has a network of nearly 600 branches across 19 states in India. DBS provides a full range of services in consumer, SME and corporate banking. As a bank born and bred in Asia, DBS understands the intricacies of doing business in the region’s most dynamic markets. DBS is committed to building lasting relationships with customers and positively impacting communities through supporting social enterprises as it banks the Asian way. It has also established an SGD 50 million foundation to strengthen its corporate social responsibility efforts in Singapore and across Asia. In 2020, DBS introduced the “Towards Zero Food Waste” initiative as part of a global sustainability practice to encourage a shift in behaviours and mindsets to reduce food waste. With its extensive network of operations in Asia and emphasis on engaging and empowering its staff, DBS presents exciting career opportunities. The bank acknowledges the passion, commitment and can-do spirit in all our 30,000+ staff representing over 40 nationalities.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , ,

Govt may table amendment to DICGC Act in monsoon session, BFSI News, ET BFSI

Banking & Finance

[ad_1]

Read More/Less


In a bid to ensure timely support to depositors of stressed banks, the government may bring amendment to DICGC Act in the monsoon session with the objective to provide account holders easy and time-bound access to funds to the extent of the deposit insurance cover.

Last year, the government raised insurance cover on deposit five-folds to Rs 5 lakh with a view to provide support to depositors of ailing lenders like Punjab and Maharashtra Co-operative (PMC) Bank. Following the collapse of PMC Bank, Yes Bank and Lakshmi Vilas Bank too came under stress leading to restructuring by the regulator and the government.

The amendment to the Deposit Insurance and Credit Guarantee Corporation (DICGC) Act, 1961 is the budget announcement made by the Finance Minister and the Bill is almost ready, sources said.

It is expected that the Bill will be tabled in the upcoming monsoon session after being vetted by the Union Cabinet, sources added.

Once the Bill becomes the law, it will provide immediate relief to thousands of depositors who had their money parked in stressed lenders such as PMC Bank and other small cooperative banks.

As per the current provisions, the deposit insurance of up to Rs 5 lakh comes into play when the licence of a bank is cancelled and liquidation process starts.

DICGC, a wholly-owned subsidiary of the Reserve Bank of India, provides insurance cover on bank deposits.

Finance Minister Nirmala Sitharaman in the Budget speech in February said the government had approved an increase in the Deposit Insurance cover from Rs 1 lakh to Rs 5 lakh for bank customers last year.

“I shall be moving amendments to the DICGC Act, 1961 in this session itself to streamline the provisions, so that if a bank is temporarily unable to fulfil its obligations, the depositors of such a bank can get easy and time-bound access to their deposits to the extent of the deposit insurance cover. This would help depositors of banks that are currently under stress,” she had said.

It could not be presented in the Budget session due to curtailment of the last session following the spread of second wave of COVID-19 pandemic.

It is to be noted that the enhanced deposit insurance cover of Rs 5 lakh is effective from February 4, 2020. The increase was done after a gap of 27 years as it was static since 1993. The cover is provided by the Deposit Insurance and Credit Guarantee Corporation (DICGC), a wholly-owned subsidiary of the RBI.

With increased insurance cover, the banks are paying a higher premium of 12 paise against 10 paise per Rs 100 deposited without any additional burden on account holders.

The deposit insurance scheme covers all banks operating in India, including private sector, cooperative and even branches of foreign banks. There are some exemptions such as deposits of foreign governments, deposits of central and state governments, and inter-bank deposits.

It can be recalled that way back in 2009, the Raghuram Rajan committee on financial sector reforms had recommended strengthening the capacity of the DICGC, a more explicit system of prompt, corrective action, and making deposit insurance premia more risk-based.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , ,

Will Citi consumer biz sale fetch premium amid Covid uncertainty?, BFSI News, ET BFSI

Banking & Finance

[ad_1]

Read More/Less


Citi‘s decision to exit 10 Asia-Pacific markets including India was an impact of the accelerated disruption caused by the Covid 19 pandemic which has forced large banks to refocus management bandwidth and capital across the globe.

The disruption caused by Covid has forced all banks to realign their strategy as building a localised retail model especially in India where phyigital is emerging, is tough. Also, there is competition from new lenders like Bandhan and IDFC First and small finance banks.

“We believe our capital, investment dollars, and other resources are better deployed against higher returning opportunities in wealth management and our institutional businesses in Asia,” said Jane Fraser, CEO at Citi, while announcing the shutdown of consumer banking business in Asia including in India.

With consumer business being very competitive with the lender having to invest in people, technology and process.

India consumer business

Macquarie Research has valued Citibank’s India retail business at around $2 billion, based on their Basel III disclosures in the country. This makes India the most valuable business among the 10 markets in the Asia-Pacific where Citi plans to exit consumer business. These 10 markets

are collectively valued between $6.3 billion and $8 billion by Macquarie.

According to a report by the Australian bank, going by SBI Card’s valuation, Citi’s 2.7 million cards would imply a figure of $2.7 billion. “This is above the top end of our valuation… To the extent that a single buyer is able to purchase multiple businesses at once, we would expect some sort of valuation discount in order to expedite Citi’s exit,” the report said.

“As the deal does not come with bank licences nor distribution, the sale is likely to take place in fragments. Across the region, there are very few banks who have the requisite footprint to bolt-on all of Citi’s various retail businesses,” the report had said.

The report identifies DBS, OCBC and StanChart as possible cross-border buyers, but is uncertain about HSBC. Besides the 10 Asia-Pacific markets, Citi announced its plans to exit consumer banking from three other markets — the Philippines, Poland and Russia. A Bloomberg report quoted a Citi official stating that the bank was looking to sell its entire operations in India in one go.

“We have always been open to exploring sensible bolt-on opportunities in markets where we have a consumer banking franchise and where we can overlay our digital capabilities to serve our customers better,” a representative for DBS told Bloomberg.

The reasons for exit

Also, due to regulations, Citibank was not able to build scale in consumer banking. To be sure, RBI has allowed foreign banks to set up branches or acquisitions if they shift from the current branch model to wholly-owned subsidiary model. DBS India shifted to the subsidiary model and has expanded hugely with the acquisition of Lakshmi Vilas Bank.

Citi has expanded its retail business in the early 2000s and was among the pioneers of corporate sector salary business with its Suvidha accounts, but was hit after the 2008 financial crisis globally, which saw the break up of the bank. It was then steered out of the crisis by Indian born CEO Vikram Pandit.

Citi India, which operates as a branch of the global giant, has a balance sheet size of Rs 2.18 lakh crore. HSBC with a balance sheet size of Rs 2.11 lakh crore and Standard Chartered with Rs 1.84 lakh crore in 2019-20.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , ,

Distraught depositors want PMC Bank revived soon

Banking & Finance

[ad_1]

Read More/Less


Distraught depositors of the scam-hit Punjab and Maharashtra Co-operative (PMC) Bank want the Reserve Bank of India (RBI) to speed up revival/reconstruction of the bank as they are in dire need of money to meet exigencies arising from the second wave of the Covid-19 pandemic.

Some of the depositors, especially the elderly, are barely able to get by despite having lakhs and crores of rupees locked up in the bank, as the RBI clamped down on deposit withdrawal since September 24, 2019, capping it at ₹1 lakh per depositor for the entire period that the bank is under Directions.

With RBI extending its Directions against the bank for the fourth time from April 1 to June 30, 2021, depositors are wringing their hands in despair that even after 19 months no solution to their woes is in sight.

RBI extends ‘directions’ against PMC Bank by 3 months

They pointed out that while depositors of other troubled banks such as YES Bank and Lakshmi Vilas Bank were rescued in double-quick time, when it comes to their bank, the rescue process has been drawn out.

Complex process, says RBI

Chander Purswani, President, PMC Depositors’ Forum, said: “The Bank should be revived/ reconstructed on SOS basis…Depositors are losing their lives amid the raging pandemic. These are testing times for all of us. The authorities should have some mercy on us.”

PMC Bank revival: Phased deposit withdrawal likely for customers

In a statement issued on March 26, 2021, the RBI observed that PMC Bank had received binding offers from certain investors for its reconstruction, in response to the Expression of Interest (EOI) floated by the bank in November 2020.

“RBI and PMC Bank are presently engaging with prospective investors in order to secure best possible terms for the depositors and other stakeholders while ensuring long-term viability of the reconstructed entity,” the central bank said.

The RBI also emphasised that given the financial condition of PMC Bank, the process is complex and is likely to take some more time.

Depositors’ angst: tweets say it all

Vasu Chhabria (@vasuchhabria) tweeted: “Reqst PMCBank Reconstruction/Resolution on war footing. Depositors losing lives. Pls don’t punish innocent citizens tax payers.

“Delay is costing lives. 19 months passed 118 depositors dead. What is their fault? It’s their hard earned money…”

Prem Kodnani (@drkodnani) tweeted: “If corona virus symptoms 1: difficult to get tested 2: difficult to get ambulance 3: difficult to get bed 4: difficult to get oxygen 5: difficult to get Remedesivir 6: to get all this, we require money…”

Srikanth Iyer (@SrikanthIyer10) tweeted: “Pls have humanity towards us v r also citizens of India rescue us by merging Pmc Bank with nationalised bank immediately it’s need of the hour…We can’t have access to our own hard-earned money.”

PMC bank was placed under RBI Directions with effect from the close of business on September 23, 2021, due to a huge fraud perpetrated by the promoter of a real estate group and some bank officials.

The Centrum-BharatPe combine is believed to be the front-runner in the race to buy PMC Bank.

As per the EOI floated by PMC Bank in November 2020, 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 (SFB) by making an application to RBI, subject to compliance with the RBI guidelines on Voluntary Transition of Primary (Urban) Co-operative Banks (UCBs) into SFBs.

[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , , , , , , , ,

RBI to conduct customer satisfaction survey on bank mergers, BFSI News, ET BFSI

Banking & Finance

[ad_1]

Read More/Less


The Reserve Bank of India (RBI) has decided to conduct a customer satisfaction survey to find out the impact of the recent mergers of state-owned banks on banking services being availed by individuals.

Among other things, the respondents will be asked whether the merger was positive from the point of customer services. The choice before the customer will be to tick one of the following options — strongly agree; agree; neutral; disagree; or strongly disagree.

The proposed survey will cover a total of 20,000 respondents from 21 states, including Uttar Pradesh, Maharashtra, West Bengal, Tamil Nadu, Bihar, Karnataka, Madhya Pradesh, and Gujarat. In all, there will be 22 questions.

Of the 22, a set of four questions has been drafted separately for assessing customer service and grievance redress issues of customers of branches of banks that have been merged with other banks in the year 2019 and 2020.

Among public sector banks, Dena Bank and Vijaya Bank were merged with Bank of Baroda; Oriental Bank of Commerce and United Bank of India with Punjab National Bank; Syndicate Bank with Canara Bank; Allahabad Bank with Indian Bank; Andhra Bank and Corporation Bank with Union Bank of India.

Also, Lakshmi Vilas Bank was merged with DBS Bank.

The questions related to mergers are: ‘I did not face any problem in availing services after the merger’; ‘I faced problems in the following product(s)/service(s)/area(s)’; and ‘The nature of problem I faced in the product(s)/service(s)/area(s)’.

The participants will also be asked: “overall, the merger has been positive from customer service perspective”; and options against this are ‘strongly agree’; ‘agree’; ‘neutral’; ‘disagree’; and ‘strongly disagree’.

While inviting quotations for conducting the ‘Bank Customers’ Satisfaction Survey’ from survey agencies, the central bank said the approved vendor will be required to conduct interview over phone with recording of customers of bank branches falling in identified states.

The RBI will provide the contact number of the customers of bank branches selected from the 21 states. The selected agency will have to complete the survey work and submit the report to the RBI by June 22, 2021.

Request for quotations (RFQ) document said the questions have been framed to capture the customer’s experience and perception of the grievance redress mechanism of his/her bank. It is also for awareness about the grievance redressal mechanism of the bank and the banking ombudsman.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , , , ,

SBM Bank bets on tie-ups to grow India ops; not to add branches, BFSI News, ET BFSI

Banking & Finance

[ad_1]

Read More/Less


SBM Bank India, the wholly-owned subsidiary of the Mauritian government’s SBM, is betting on partnerships with fintechs and non-bank entities to grow its business here and is not interested in growing its branch network like DBS Bank India did with an acquisition, a top official has said. SBM Bank India wants to grow its business through granular liabilities collection and booking fees by aiding in various banking transactions, its managing director and chief executive Sidharth Rath said.

It can be noted that DBS, the only other wholly-owned subsidiary, acquired struggling private sector lender Lakshmi Vilas Bank last year, which gave it access to 563 branches.

“DBS has their own strategy. Yes, they have gone for inorganic growth … we are also doing inorganic but through partners, let me put it this way,” Rath said.

When asked specifically if it will be interested in tie-ups or deals where equity changes hands – which are otherwise referred to as ‘inorganic’ growth – Rath said at present, it is focused to grow through technology-led and digital-led platforms.

“Going forward, one doesn’t know what it (SBM) would be, how it is going to look, but it is going to be under them (parent State Bank of Mauritius) only,” he said, not discounting the possibility of a strategic partnership, a public issue or even an acquisition like DBS.

The bank is not keen on adding to its brick and mortar branch network, which right now consists of six outlets in metro cities and two in unbanked rural areas, Rath said, adding that it may at best look at adding two more branches in FY22.

The strategy for the new fiscal year will be to scale up on the foundation of the partnership-led model by getting new customers or forging new tie-ups.

A large part of the focus is on driving retail business, which consists only 10 per cent of the Rs 3,500 crore loan book as of March 31, and take it to 25 per cent by end of the next fiscal, Rath said.

Neeraj Sinha, the head of consumer and retail banking at SBM explained that there a slew of fintechs who have developed the right platform, user interface and also a customer base, which are looking at growing, and can help by tying up with a bank.

Being an upstart venture, SBM is open to tie-up with such entities so as to create win-win proposition for both the partners and also the end customer, he said, giving out details of some of the over 20 partnerships it has.

He said as part of one partnership, it has tied up with an entity which will help connect it with those having credit rejections repeatedly. Against a fixed deposit with the bank, SBM will lend the person and help her build a better credit history over a period of time, he said.

Similarly, given the working capital shortage with small businesses, it has a tie-up where a non-bank gives it access to those desirous of getting the card. The customer makes a fixed deposit (FD) with the bank to get the card and enjoy a 30-day credit like the one available for any consumer, he said.

Sinha said that already, over a fourth of its current account deposits are courtesy such tie-ups and the number of customers onboarded through such pacts is 1.5 lakh.

“I am not competing with them (the partners), and hence, I am also the natural choice for the fintechs to come and work with. Lack of size becomes an advantage for me there. This is a typical challenger bank strategy,” Sinha said.

The bank’s overall balance-sheet including both advances and deposits stood at Rs 6,000 crore as on March-end, the share of the low-cost Current Account Saving Account (CASA) deposits was 21 per cent and the capital buffers were at 24 per cent.

When asked if the bank will need any capital, Rath hinted that there will be no need, pointing out that one needs to deliver on the capital as well. He, however, added that whenever needed, the parent will be giving the capital.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , , ,
1 2