Tag: pnb

Public sector banks’ corporate loans decline in Q1 as Covid, competition hurt, BFSI News, ET BFSI

Banking & Finance

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Lending to the corporate sector by public sector banks declined significantly in the first quarter as Covid kept the demand depressed and competition from private sector banks and the bond market rose.

The domestic corporate loans by the State Bank of India fell 2.23 per cent to Rs 7,90,494 crore in the quarter ended June 30, 2021, compared to Rs 8,09,322 crore in the same quarter last year. In the fi rst quarter of FY21, SBI reported 3.41 per cent growth in corporate advances.

Union Bank of India‘s share of industry exposure in domestic advances dropped to 38.12 per cent at Rs 2,40,237 crore from 39.4 per cent at Rs 2,47,986 crore in the same quarter a year ago. Corporate loans dropped 3% at Indian Bank during the last quarter. At PNB, corporate loans fell 0.57 per cent at Rs 3,264,66 crore in June quarter 2021 compared to

Rs 3,28,350 crore a year ago.

Up to May, the gross loans to large industries declined by 1.7 per cent year­-on­year, according to RBI data.

Ceding ground of private-sector rivals

The market share of public sector banks in loans declined to around 59 per cent (of all scheduled commercial banks’ outstanding credit) in December 2020 against around 65 per cent in December 2017.

However, during this period, PvSBs market share rose to around 36 per cent from around 30 per cent, going by Reserve Bank of India data.

Falling industrial credit

The share of banks in loans to the industrial sector dropped massively during 2014-2021 even as credit to the retail sector, including home loans, saw a boom.

As per the data, industrial credit fell to 28.9% by March 2021 from 42.7% at the end of March 2014.

“Over recent years, the share of the industrial sector in total bank credit has declined whereas that of personal loans has grown,” the Reserve Bank of India said in its Financial Stability Report.

The environment for bank credit remains lacklustre in the midst of the pandemic, with credit supply muted by persisting risk aversion and subdued loan demand and within this overall setting, underlying shifts are becoming more evident than before, it said.

Loans to the private corporate sector declined from 37.6% in 2014 to 27.7% at the end of March 2021. During the same period, personal loans grew from 16.2 to 26.3%, in which housing loans grew from 8.5% to 13.8%.

Fiscal 2021

Bank credit growth to the industrial sector decelerated 0.8% year-to-date as of May 21, 2021, due to poor loan offtake from the corporate sector.

Growth in credit to the private corporate sector, however, declined for the sixth successive quarter in the fourth quarter of the last fiscal and its share in total credit stood at 28.3 per cent. RBI said the weighted average lending rate (WALR) on outstanding credit has moderated by 91 basis points during 2020-21, including a decline of 21 basis points in Q4.

Overall credit growth in India slowed down in FY21 to 5.6 per cent from 6.4 per cent in FY20 as the economy was hit hard by Covid. and subsequent lockdowns.

Credit growth to the industrial sector remained in the negative territory during 2020-21, mainly due to the COVID-19 pandemic and resultant lockdowns. Industrial loan growth, on the other hand, remained negative during all quarters of 2020-21.”

The RBI further said working capital loans in the form of cash credit, overdraft and demand loans, which accounted for a third of total credit, contracted during 2020-21, indicating the impact of the coronavirus pandemic.

Shift to bonds

The corporate world focused on deleveraging high-cost loans through fundraising via bond issuances despite interest rates at an all-time low. This has led to muted credit growth for banks.

Corporates raised Rs 2.1 lakh crore in December quarter and Rs 3.1 lakh crore in the fourth quarter from the corporate bond markets. In contrast, the corresponding year-ago figures were Rs 1.5 lakh crore and Rs 1.9 lakh crore, respectively.

Bonds were mostly raised by top-rated companies at 150-200 basis points below bank loans. Most of the debt was raised by government companies as they have top-rated status.

For AAA-rated corporate bonds, the yield was 6.85 per cent in May 2020, which fell to 5.38 per cent in April 2021 and to 5.16 per cent in May 2021.



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Banks to discuss next course of action on Vodafone Idea, BFSI News, ET BFSI

Banking & Finance

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NEW DELHI: Lenders to Vodafone Idea (VIL) are expected to hold talks to decide on the future course of action with regard to their exposure to the debt-laden telecom player which is struggling to stay afloat.

This comes in the wake of Aditya Birla Group chairman Kumar Mangalam Birla offering to hand over his stake in VIL to the government or any other entity so that the company remains functional.

Meanwhile, Birla on Wednesday stepped down as non-executive director and non-executive chairman of Vodafone Idea.

S S Mallikarjuna Rao, MD and CEO of Punjab National Bank, on Tuesday said the developments in the last few days were areas of concern for the banking industry, referring the AGR-related issues for the telecom players.

Rao, however, said PNB‘s exposure is not very high in VIL and it is not going to impact its balance sheet.

“However, we will be definitely discussing with other bankers to see what kind of action we need to take going forward considering the statement of K M Birla only yesterday,” Rao said, referring to the billionaire businessman’s offer to hand over his stake in VIL to the government or any other entity.

The Supreme Court has dismissed applications by telcos for recalculation of AGR-related dues.

According to official data, VIL had an adjusted gross revenue (AGR) liability of Rs 58,254 crore, out of which the company has paid Rs 7,854.37 crore and Rs 50,399.63 crore is outstanding.

The apex court, in an order passed in September last year, had asked the telecom players to settle their AGR related dues worth Rs 93,520 crore towards the government over a period of 10 years.

VIL’s gross debt, excluding lease liabilities, stood at Rs 1,80,310 crore as of March 31, 2021.

IDFC First Bank has marked the account of VIL as stressed and has made provisions of 15 per cent (Rs 487 crore) against the outstanding exposure of Rs 3,244 crore (funded and non-funded).

“This provision translates to 24 per cent of the funded exposure on this account. The said account is current and has no overdues as of June 30, 2021,” the lender said in its Q1FY22 investor presentation, referring to the account as “one large telecom account”.

Writing a letter to Cabinet Secretary Rajiv Gauba in June, Birla, who holds around 27 per cent stake in VIL, said investors are not willing to invest in the company in the absence of clarity on AGR liability, adequate moratorium on spectrum payments and most importantly floor pricing regime being above the cost of service.

“It is with a sense of duty towards the 27 crore Indians connected by VIL, I am more than willing to hand over my stake in the company to any entity- public sector/government /domestic financial entity or any other that the government may consider worthy of keeping the company as a going concern,” Birla said in the letter.

Among the other players, the AGR liability of Bharti Airtel is Rs 43,980 crore, Tata group Rs 16,798 crore, BSNL Rs 5,835.85 crore and MTNL Rs 4,352.09 crore.

Bharti Airtel has paid the government Rs 18,004 crore, Tatas Rs 4,197 crore and Reliance Jio has cleared its entire dues of Rs 194.79 crore.

Anil Ambani-owned Reliance Communications owes Rs 25,194.58 crore, Aircel Rs 12,389 crore and Videocon Telecommunications Rs 1,376 crore. However, these companies are under liquidation process.

Companies like Loop Telecom, Etisalat DB and S Tel, which jointly owe the government Rs 604 crore, have shut down their India operations.



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PNB expects recovery of Rs 14,000 cr in 3 qtrs; Rs 4-6K cr profit in FY22, BFSI News, ET BFSI

Banking & Finance

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New Delhi, Aug 3 (PTI) State-owned Punjab National Bank (PNB) on Tuesday said it expects a recovery of Rs 14,000 crore from bad loans during the three quarters and earn a profit of Rs 4,000-6,000 crore in 2021-22 aided by rationalisation of expenses along with robust recovery. Controlling the expenditure has got multiple dimensions, one of them is rationalisation of branches, PNB managing director S S Mallikarjuna Rao told reporters.

“We have succeeded in rationalising more than 500 branches. We are expecting to rationalise 1,000 branches by March 2022, which will give huge amount of reduction in the operational expenditure,” he said.

Currently, the bank has about 10,641 branches across the country.

On the recovery side, he said, the bank expects Rs 5,000-5,200 crore from NCLT cases by March 2022. This will help reduce bad debt or non-performing assets by about Rs 12,000 crore.

“In normal recovery we generally get around Rs 3,000 crore per quarter. So, another Rs 9,000-10,000 crore we are expecting in normal recovery,” he said.

Rao exuded the confidence that the bank should earn annual profit between Rs 4,000 crore and Rs 6,000 crore aided by strong recovery and cost rationalisation during the current financial year.

“Guidance for 2021-22 would be Rs 4,000-6,000 crore…at the balancesheet level the cost of deposits have been reduced drastically, cost to income ratio has been reduced, yield on advances has come down,” he said.

Besides, recoveries from NPAs where provision coverage ratio is 80 per cent, these will be write back, he said.

“So 50 per cent of profit will be contributed by the write back during the year. So profit would come from mix of cost rationalisation and write back,” he said.

With regard to further capital raising, he said, if you look at the capital adequacy ratio, it is 15.19 which is adequate to take care of 8-10 per cent credit growth.

“However, PNB, being a big bank, in order to insulate itself from the capital requirement for future and not to depend on the government, we will definitely look at discuss about it one month or so and take a call on that,” he said.

This exercise would be with a view to generating buffers not for meeting business requirement, he said. Currently, the government holds 73.1 per cent in the bank.

On the perceived threat on the telecom sector due to the AGR order of the Supreme Court, he said all the telecom players are requesting the government to look at it. “So the developments in the last few days are areas of concern for the banking industry,” he said.

PNB’s exposure is not very high that is going to impact the balance sheet, he said, adding “however, we will be definitely discussing with other bankers to see what kind of action we need to take going forward considering the statement of K M Birla only yesterday.”

The Supreme Court last month said it would pass orders on applications filed by telecom majors-Vodafone Idea, Bharti Airtel and Tata Tele Services Ltd-raising the issue of alleged errors in calculation in the figure of adjusted gross revenue (AGR)-related dues.

The apex court in September last year had given 10 years time to telecom service providers struggling to pay Rs 93,520 crore of AGR-related dues to clear their outstanding amount to the government.

Rao also said PNB will divest its stake in Canara HSBC OBC Life Insurance Company in the next 12 months.

The city-headquartered state-owned bank had acquired a stake in the life insurer post amalgamation of the erstwhile Oriental Bank of Commerce (OBC) into itself last fiscal year. The erstwhile OBC held 23 per cent stake in the life insurer, which by virtue of amalgamation has come to PNB.

Canara Bank owns 51 per cent stake, while HSBC Insurance (Asia Pacific) Holdings Ltd as a foreign partner owns 26 per cent.

It is also a promoter of another insurer PNB Metlife Insurance, owning the highest stake of 30 per cent. The company was set up in 2001, in which other shareholders include US-based Metlife with 26 per cent, Elpro (21 per cent) and M Pallonji & Company (18 per cent).

As per extant insurance guidelines of Insurance Regulatory and Development Authority of India (Irdai), one promoter cannot hold more than 10 per cent stake in two insurance ventures. PTI DP MR MR



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PNB eyes ₹4,000-6,000 cr net profit in FY’21-22: CEO

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Punjab National Bank (PNB) expects its net profit for the current fiscal to be around ₹ 4,000-6,000 crore, S.S.Mallikarjuna Rao, Managing Director & CEO, said on Tuesday. This guidance is significant as the bank had closed fiscal 2020-21 with a net profit of ₹ 2,022 crore.

Rao said that he expects over 50 per cent of this guided net profit for 2021-22 to be contributed by write-back of provisions made on NPAs (bank has over 80 per cent provision coverage ratio).

The bottomline will also be bolstered by cost optimisation and branch rationalisation exercise the bank will continue to undertake this fiscal. PNB, which had rationalised (merged) over 380 branches in Q1, is looking to rationalise about 1000 branches by March end this fiscal and go in for setting up new smaller sized branches that are more digitally driven and expand in regions like South and Western India where PNB is not that strong in terms of branch distribution and needs to be strengthened, Rao said at a virtual press conference post the declaration of Q1 results of the bank.

This rationalisation is expected to give huge reduction in operational expenditure for PNB and thereby gain synergies out of the three-way amalgamation with United Bank of India and Oriental Bank of Commerce that comes into force from April 1 next year, he said.

75% hike in profit

PNB on Monday evening reported a 75 per cent increase in standalone net profit for the first quarter ended June 30 at ₹1,023.46 crore as against net profit of ₹586.33 crore in the March quarter. On a year-on-year basis, net profit grew 232 per cent when compared to net profit of ₹ 308.45 crore net profit recorded in the June quarter last year.

Going forward, Rao said that PNB expects to make cash recovery of ₹5,000 crore from NCLT itself this fiscal and reduce debt of ₹12,000 crore. “Apart from that, we get normal recovery ₹ 3,000 crore every quarter as normal recovery. So I am expecting cash recovery of ₹14,000 crore and much higher debt reduction of ₹ 20,000- 22,000 crore”, he said.

Also read: PNB Q1 net up 75% sequentially to ₹1,023 crore

For the quarter under review, PNB made recoveries of about ₹8,000 crore including realisation of ₹1,000 crore from the grounded Kingfisher Airlines.

Rao said that he expects credit growth to pick up from second quarter. The credit growth is expected to improve in the next three quarters compared to what has been so far this year and the bank expects overall credit growth to be 8-10 per cent this fiscal. PNB is looking to bring down its net NPA below 5 per cent by end March 2022.

Valuation controversy

Asked on the recent valuation controversy on PNB Housing Finance, a company in which PNB holds about 32 per cent stake, Rao said that he would wait for the Securities Appellate Tribunal (SAT) to come out with its order and then on the basis of that order the housing finance lender as well as PNB will look at various options. “This issue is a matter of interpretation of law. This can be put to conclusion decisively only by judiciary, non-judiciary and regulator. We are awaiting judgement of SAT and we are bound to follow the judgement given by SAT. I do not want to presuppose what kind of order will come and we will take a call only after the SAT order comes. We will go by the SAT order both in letter and spirit”, Rao said.

He made it clear that PNB had not asked PNB Housing to reconsider the Carlyle deal, but only asked the housing finance lender to follow the directions specified in SEBI’s letter to PNB Housing. “ It’s not a question of going diametrically opposite of what has been done in the deal. We (PNB) have only told them (PNB Housing) that SEBI’s communication to PNB Housing may be looked into in terms of reconstruction of the entire process. This is now in the domain of SAT and we will wait for the SAT order”, he said.

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PNB Q1 net up 75% sequentially to ₹1,023 crore

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Aided by lower provisioning for non-performing assets and tight control on operating expenses, Punjab National Bank (PNB) on Monday reported a 75 per cent growth in standalone net profit for the first quarter ended June 30 at ₹1,023.46 crore against ₹586.33 crore in the March quarter.

On a year-on-year basis, its net profit grew a whopping 231.81 per cent compared to ₹308.45 crore in the same quarter last year.

It maybe recalled that the three way amalgamation of Punjab National Bank, United Bank of India and Oriental Bank of Commerce had come into effect from April 1 last year. This is the first time when a like-to-like comparison of Q1 of the banking behemoth (amalgamated bank) is available, say some banking industry observers.

For the quarter under review, PNB’s total income for the quarter under review stood at ₹22,515 crore, slightly lower than total income of ₹22,532 crore recorded in the previous quarter. In the first quarter last fiscal, it had registered total income of ₹ 24,293 crore.

Also read: PNB moves court seeking restoration of assets of Nirav Modi’s firms seized by ED

Operating profit increased to ₹6,098.65 crore from ₹5,634.31 crore in the March quarter. Its operating profit in June quarter last year was ₹5,280 crore.

Operating expenses of the bank fell sharply in the first quarter ended June 30 this year at ₹4,722 crore as against ₹5,045 crore in the March quarter. In the June quarter last year, operating expenses had come in at ₹5,156 crore.

Provision for NPAs for the quarter under review stood at ₹3,248 crore against ₹5,294 crore in the March quarter this year and ₹4,836 crore in the June quarter last year.

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Forcing minimum claim period of 1 year on bank guarantees wrong, says Delhi HC, BFSI News, ET BFSI

Banking & Finance

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In a ruling that will help infrastructure and construction companies, the Delhi High Court said forcing a minimum claim period of 12 months for bank guarantees is wrongful, rejecting interpretations that existing laws rendered shorter claim periods void.

Ruling on a petition filed by engineering conglomerate Larsen & Toubro Ltd against Punjab National Bank, a single-judge bench of the High Court observed, “It is clear that respondent No 1 (PNB) is erroneously of the view that they are in law mandated to stipulate a claim period of 12 months in the bank guarantee, failing which the clause shall be void under Section 28 of the Contract Act.”

The court directed the lender to take a relook at such agreements.

“It (Section 28) deals with the right of the creditor to enforce his rights under the bank guarantee, in case of refusal by the guarantor to pay, before an appropriate court or tribunal,” Justice Jayant Nath observed in a 43-page order issued on Wednesday. It does not deal with the claim period – a time within which the beneficiary is entitled to claim the guarantee.

Experts said the ruling will particularly benefit infrastructure and construction companies that need to issue bank guarantees while fulfilling contracts for government bodies and public sector undertakings.

“This decision will have far-reaching consequences because it will give both banks and companies the much-needed flexibility in entering into contracts related to bank guarantees,” said Ashish K Singh, managing partner of law firm Capstone Legal.

Anil Goel, founder and chairman of insolvency professional company AAA Insolvency Professionals, said, “Construction companies bidding for projects should have the flexibility to bank guarantee from banks. Multiple options to get it should help them bid for more projects and save costs substantially.”

L&T, in its petition, argued that PNB’s insistence on a bank guarantee (BG) for 12 months, due to misinterpretation of Section 28, has unnecessarily made the company liable to pay commission charges for such extended BG when the principal contract would be for a much shorter period.

Also, companies have to maintain collateral security – or margin money against which a bank guarantee is issued – for supporting an extended claim period, which affects their capability to do business by entering new contracts, L&T said.

Hemant Kumar, group general counsel of L&T, confirmed the passing of an order by the Delhi High Court but refused to divulge any details.

An email query to PNB remained unanswered as of press time Friday.

L&T had made the Indian Banks’ Association (IBA) and the Reserve Bank of India (RBI) parties in the case.

As per the court order, PNB’s stand is due to letters issued by IBA on December 12, 2018, to its member banks, stating that if a bank issues a claim period of less than one year on top of the guarantee period then such a bank guarantee would not have the benefit of Exception 3 to Section 28 of the Contract Act.

Exception 3, inserted as an amendment to the Act in 2013, allowed lenders to limit the period to make a claim up to one year, down from the minimum of three years provided under the Limitation Act.

BGs are provided on a case to case basis depending on banks and individual clients. The margin money varies, but normally it is about 10-20% of the bank guarantee amount, industry insiders said.



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Govt set to extend tenures of MDs of PNB, UCO, Bank of Maha, BFSI News, ET BFSI

Banking & Finance

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The finance ministry has moved a file for extension of tenure of three public sector banks’ managing directors, including Punjab National Bank (PNB), according to sources.

Besides, the ministry has also recommended the Department of Personnel and Training (DoPT) for extension of 10 executive directors (EDs) of various public sector banks.

Tenure extension

The three-year term of S S Mallikarjuna Rao, MD and CEO of PNB, is coming to an end on September 18 but the finance ministry has recommended for extension for four months till January 31, 2022, when Rao attains his superannuation age of 60 years.

Atul Kumar Goel’s term as MD and CEO of UCO Bank has been recommended for a two-year extension beyond November 1 this year. A S Rajeev, MD and CEO of Bank of Maharashtra, has been suggested for an extension of two years beyond December 1.

The finance ministry has simultaneously forwarded the name of S L Jain for the appointment of MD and CEO of Indian Bank. The BBB, the headhunter for state-owned banks and financial institutions, had recommended the name of Jain in May after the interview, according to reports.

With regard to EDs, the ministry has recommended names of 10 for extension of their term till their superannuation age or two years, whichever is earlier.

The MD and CEO of a public sector undertaking is given a maximum tenure of five years as a government guidelines.

The ministry sought extension of the executives from the Appointments Committee of Cabinet (ACC). The proposal has been sent to the Dof Personnel and Training for the same after consultation with BBB. The final call for extension will be taken by the ACC.

Board seats vacant

Ten of the 12 public-sector banks, except State Bank of India (SBI) and Bank of Baroda do not have a chairman.

Also, most non-official director posts, which are occupied by professionals from other fields, remain vacant. There are no employee representatives on PSB boards at present.

A large bank can have four executive directors, six non-official directors (of whom up to three could be shareholder directors), a workman director, and an employee director, in addition to a nominee each of government and the RBI, the non-executive chairman and MD & CEO.

With posts vacant, banks are finding it difficult to fill the quorum of their board sub-committee meetings such as risk management, capital raising, audit and even management committee meetings.



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FinMin moves file for extension of 3 MDs, 10 EDs of govt-owned banks, BFSI News, ET BFSI

Banking & Finance

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New Delhi, Jul 25 () The finance ministry has moved a file for extension of tenure of three public sector banks’ managing directors, including Punjab National Bank (PNB), according to sources. Besides, the sources said the ministry has also recommended the Department of Personnel and Training (DoPT) for extension of 10 executive directors (EDs) of various public sector banks.

The three-year term of S S Mallikarjuna Rao, MD and CEO of PNB, is coming to an end on September 18 but the finance ministry has recommended for extension for four months till January 31, 2022, when Rao attains his superannuation age of 60 years.

Atul Kumar Goel’s term as MD and CEO of UCO Bank has been recommended for a two-year extension beyond November 1 this year. A S Rajeev, MD and CEO of Bank of Maharashtra, has been suggested for an extension of two years beyond December 1.

The finance ministry has simultaneously forwarded the name of S L Jain for the appointment of MD and CEO of Indian Bank. The BBB, the headhunter for state-owned banks and financial institutions, had recommended the name of Jain in May after the interview.

With regard to EDs, the ministry has recommended names of 10 for extension of their term till their superannuation age or two years, whichever is earlier.

The MD and CEO of a public sector undertaking is given a maximum tenure of five years as a government guidelines.

According to sources, the ministry sought extension of the executives from the Appointments Committee of Cabinet (ACC). The proposal has been sent to the Dof Personnel and Training for the same after consultation with BBB. The final call for extension will be taken by the ACC.

Interestingly, the Banks Board Bureau (BBB) has also invited applications for appointment of new MDs of PNB.

For PNB, the BBB on June 16, had sought public application for the MD and CEO post. The eligibility criteria as announced in public notice is that the applicant should be in the age group of 45 to 57 years in mainstream banking, of which, at least one year has to be at the board level.

The compensation offered is in line with the MD and CEO of a large public sector bank, it said. DP ANZ HRS hrs



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PNB moves court seeking restoration of assets of Nirav Modi’s firms seized by ED

Banking & Finance

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The Punjab National Bank (PNB) on Wednesday moved multiple applications before a special PMLA court here, seeking restoration of the assets of two firms owned by fugitive diamond merchant Nirav Modi, who is accused of duping the bank.

The bank submitted the applications before special judge V C Barde under the relevant provisions of the Prevention of Money Laundering Act (PMLA).

The Enforcement Directorate (ED) had earlier confiscated assets worth over ₹329.66 crore of Nirav Modi under the fugitive economic offenders law. The confisticated property includes assets of Firestar Diamond International Pvt Ltd and Firestar International Limited, firms owned by Modi.

Nirav Modi and his uncle Mehul Choksi, both prime accused in the case, along with others are being probed by the Enforcement Directorate (ED) on money laundering charges for allegedly perpetrating an over $2 billion (more than ₹13,000 crore) bank fraud in connivance with bank officials and by issuance of fraudulent Letters of Undertaking (LoUs) at the Brady House PNB branch in Mumbai.

The court has asked the ED to file its reply on July 28.

Nirav Modi (49) was declared a fugitive economic offender by the PMLA court in December 2019. Following that, the court had authorised the ED to confiscate the assets under the provisions of the Act. He is currently lodged in a UK jail after being arrested in London in March 2019 and is currently fighting extradition to India.

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SC seeks response of Centre, RBI on plea of PNB against disclosure of info under RTI, BFSI News, ET BFSI

Banking & Finance

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NEW DELHI: The Supreme Court has refused to grant interim stay on the RBI‘s notice asking Punjab National Bank to disclose information such as defaulters list and its inspection reports under the RTI Act, and sought responses from the Centre, federal bank and its central public information officer.

The apex court tagged the plea of the Punjab National Bank (PNB), which is a public sector unit bank, with a similar pending case filed by HDFC Bank against the RBI’s direction.

“Issue notice. Tag with writ petition (Civil) No.1159 of 2019 (HDFC plea),” a bench comprising justices S Abdul Nazeer and Krishna Murari said, and fixed the plea for hearing on July 19.

Banks are aggrieved by the notices issued by the RBI to them under Section 11(1) of the Right to Information (RTI) Act asking them to part with information pertaining to their inspection reports and risk assessment.

The RTI Act empowers the RBI’s central public information officer (CPIO) to seek information from banks for information seekers.

Earlier on April 28, the top court, on legal grounds, had refused to recall its famous 2015 judgment in the Jayantilal N Mistry case, which had held that the RBI will have to provide information about banks and financial institutions (FIs) regulated by it under the transparency law.

Several FIs and banks, including Canara Bank, Bank of Baroda, UCO Bank and Kotak Mahindra Bank had filed applications in the top court seeking a recall of the 2015 judgment in the Jayantilal N Mistry case, saying the verdict had far-reaching consequences and moreover, they were directly and substantially affected by it.

The banks had contended that the pleas for a recall of the judgment, instead of a review, is “maintainable” as there was a violation of the principles of natural justice in view of the fact that they were neither parties to the matter nor heard.

“A close scrutiny of the applications for a recall makes it clear that in substance, the applicants are seeking a review of the judgment in Jayantilal N Mistry. Therefore, we are of the considered opinion that these applications are not maintainable,” the apex court had held.

While dismissing the pleas, the bench, however, had made it clear that it was not dealing with any of the submissions made by the banks on the correctness of the 2015 judgment.

Now, the apex court is seized of several pleas of banks like HDFC and Punjab National Bank against the RBI’s direction to disclose information under RTI.



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