Tag: state bank of india

SBI YONO crossed 70.5 million downloads and a registered user base of 37.09 million, BFSI News, ET BFSI

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Country’s largest lender, State Bank of India‘s flagship digital offering YONO (You Only Need One) has crossed 70.5 million downloads, with a registered user base of 37.09 million and averages daily logins of around 10 million.

The bank laid out the details in its annual report and said it has been operating its analytical potential through AI/ML to increment efficiency, procuring new business and for risk management.
Post retail it added the service for its corporate customers too with five applications viz Corporate Internet Banking, Cash Management Product, Supply Chain Financing Unit, e-Trade and e-Forex. Currently, SBI is functioning to avail an entire digital trade finance solution to business clients on YONO platform.

The bank said, a digital journey has also been initiated for Forex rate booking and document upload facility to enhance customer convenience, which will help the bank increase income from Forex business.

The bank had also launched YONO offering in the UK, Mauritius, Maldives, Bangladesh, Sri Lanka and Canada. As of March 31, 2021, over 40,000 overseas customers have been onboarded on the YONO platform. SBI anticipation to inaugurate YONO in the countries such as Singapore, Bahrain, South Africa, and the USA by the end of FY2022.

The bank said it will continue accelerate its digital agenda as the scope and reach of YONO will be expanded further.



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SBI Chairman, BFSI News, ET BFSI

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MUMBAI: Although the second wave of the Covid-19 pandemic again brought businesses and economic activities to a standstill, Chairman of the State Bank of India (SBI), Dinesh Kumar Khara has expressed hope that the country’s economy would recover in the ongoing financial year.

The Chairman noted that the global economy contracted by 3.3 per cent in 2020 with the pandemic causing significant loss of lives and livelihood.

The GDP in India contracted by 7.3 per cent in FY2021 and the country experienced a second wave of infections with cases rising rapidly since March 2021, he said while addressing the 66th Annual General Meeting of the bank.

He, however, said that policy measures and the coordinated efforts of the Reserve Bank of India (RBI) and the Centre were directed towards enabling growth on a more durable basis during these difficult times.

“Notwithstanding the second wave of Covid-19, Indian economy, through its resilience, is poised for a recovery in FY2022,” the SBI chief told the shareholders of the bank.

Speaking on the performance of the bank in FY21, he said that although the last fiscal was an exceptionally challenging year for the entire world, the state-run bank was able to function against all odds with minimal disruption for the customers.

“The business continuity plans that were chalked out have worked well for the Bank and this is reflected in various parameters of the Bank’s performance in FY 2021.”

Notably the bank has achieved high level of digitization with share of Alternate Channels in total transactions increasing to 93 per cent in FY2021, thereby converting a challenging situation into an opportunity, the Chairman said.

He said that in the current financial year, SBI will continue to accelerate its digital agenda, adding that the scope and reach of YONO will be expanded further.

“With the rollout of pre-package insolvency for resolution, resumption of courts and formation of National Asset Reconstruction Company, efforts will be in full force to keep the momentum in stressed asset recovery in the current financial year.”

The bank is comfortably placed in terms of growth capital. Opportunities for lending in promising sectors will be explored to diversify the portfolio and contain risk.

“In conclusion, the bank adjusted to the challenges posed by the Covid-19 pandemic and is better positioned to tackle any subsequent wave. I am cautiously optimistic that the performance trajectory of FY2021 will continue in FY2022 as well.”



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ED, BFSI News, ET BFSI

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A State Bank of India (SBI)-led consortium that lent loans to fugitive businessman Vijay Mallya on Friday received Rs 5,824.5 crore in its accounts after shares of UBL, earlier attached under the anti-money laundering law, were sold recently, the ED said. Mallya is accused in a multiple banks loan default case of about Rs 9,000 crore.

The disputes resolution tribunal (DRT) had sold these shares on June 23 after the Enforcement Directorate had transferred shares worth about Rs 6,624 crore of UBL to the SBI-led consortium on the directions of a special PMLA court that is hearing the case involving Mallya in Mumbai.

These shares were attached under the Prevention of Money Laundering Act (PMLA) by the ED, a central probe agency.

“Today, SBI led consortium received Rs 5824.5 crore in its account from the sale of shares of United Breweries Limited.”

“The sale had taken place on 23.06.2021 as sequel to the transfer of the shares to the Recovery Officer by ED,” the central agency tweeted.

The rest of the shares worth about Rs 800 are “expected” to be sold and realised in the accounts of the SBI-led group of banks by June 25, it had earlier said.

The ED had issued a statement on Wednesday stating that about 40 per cent of the money lost by banks in alleged frauds perpetrated by fugitive businessmen Nirav Modi, Mehul Choksi and Mallya has been recovered so far due to its “swift” action in attaching and freezing their assets.

Mallya, who fled to the UK, is being probed by the ED and the CBI for a Rs 9,000 crore alleged bank fraud linked to the operations of his now defunct Kingfisher Airlines.

On Wednesday, the ED had said the banks had “recovered” Rs 1,357 crore by a similar sale of shares in the case against Mallya.

The liquor baron has lost his case against extradition to India and as he has been denied permission to file appeal in the UK Supreme Court, his extradition to India has become final, the ED had said.

Commenting on the development, Union Finance Minister Nirmala Sitharaman had tweeted on Wednesday that “Fugitives & economic offenders will be actively pursued; their properties attached & dues recovered.”



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Will stay focused on recovering stressed assets in FY22: SBI chairman Dinesh Kumar Khara

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Khara also highlighted that bank is comfortably placed in terms of growth capital. “The opportunities for lending in promising sectors will be explored to diversify the portfolio and contain risk,” he further added.

The chairman of State Bank of India (SBI), Dinesh Kumar Khara, on Friday said that the bank would remain focused on recovering stressed assets even in FY22. In his address to shareholders at bank’s annual general meeting (AGM), Khara said that rollout of pre-packages, resumption of courts and formation of National Asset Reconstruction Company (NARCL) would help in recovery efforts.

FE had earlier reported that SBI is likely to send bad loans worth Rs 20,000 crore at NARCL. Despite Covid-19, the total recovery from advances under collection accounts (AUCA) rose 10% at Rs 10,297 crore in FY21, compared to Rs 9,250 crore in FY20. Khara also said that bank will continue to accelerate its digital agenda and the scope and reach of YONO will be expanded further.

“The bank adjusted to the challenges posed by the Covid-19 pandemic and is better positioned to tackle any subsequent wave. I am cautiously optimistic that the performance trajectory of FY21 will continue in FY22 as well,” Khara said at 66th AGM of the bank. The bank had reported highest ever net profit of Rs 20,410 crore in FY21, against net profit of Rs 14,488 crore in the previous year. The return on assets (RoA) for the lender improved by 10 basis points (bps) to 0.48% in FY21, compared to 0.38% in FY20. Similarly, return on equity (RoE) improved by 220 bps to 9.94%.

Last month, CLSA in its report had estimated SBI’s RoE to increase to 15% by FY23. “SBI’s multiples have increased to 0.8x March23 book from and 0.3x March 2023 book, but with +15% RoE expectation, we still see a deep value.” CLSA said.

Khara also highlighted that bank is comfortably placed in terms of growth capital. “The opportunities for lending in promising sectors will be explored to diversify the portfolio and contain risk,” he further added.

The capital adequacy position of the bank improved from 13.06% in March 2020 to 13.74% in March, 2021. The tier I capital has increased by 44 bps to 11.44%.

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Banks see revival from July, tank up capital to meet loan demand, BFSI News, ET BFSI

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Banks are hoping for revival from the next month as Covid infections and lockdowns ease and have started raising capital to meet the likely loan demand jump.

State-owned Indian Bank has raised Rs 1,650 crore through the QIP launched earlier this week. In March this year, the committee of directors of capital raising of the bank had accorded approval for raising equity capital aggregating up to Rs 4,000 crore through QIP in one or more tranches.

State Bank of India has received its board’s approval to raise Rs 14,000 crore through the issuance of additional tier 1 capital.

Kolkata-based Uco bank has received a board approval for Rs 500 crore tier 2 issue, over and above an earlier approval for up to Rs 3,000 crore through share sales.

Bank of Maharashtra has received shareholders’ approval to raise up to Rs 5,000 crore equity capital through various modes, including rights issue and preference issue.

The shareholders approved the proposal at the bank’s annual general meeting (AGM) held on June 24, 2021, through audio/visual means.

Banks see revival from July, tank up capital to meet loan demand

Gradual recovery

The non-food year-on-year credit growth was recorded at 5.7% as on June 4, slower than 6.2% seen a year back, Reserve Bank of India data showed. This reflects risk aversion from both borrowers and lenders. However, bankers and brokerages are expecting an uptrend here on.

“We continue to believe that credit growth will bounce back in the near-term from the short-term ‘second wave’ disruption,” HDFC Securities said in a note earlier in the month. The credit demand is primarily expected from the retail segment as seen in earlier months while corporate demand is likely to be muted.

Corporate credit growth is likely to be subdued as companies are still deleveraging and may not go for capex soon.

“Corporate willingness for new investments remains low currently as the economy is still recovering from the devastating second wave. Investment scenario is tepid as gauged by new investment announcements, which saw 67% decline in FY21 as per CMIE,” SBI’s economic research said.

Banks are better placed this year to support credit growth with as many as 12 public banks reporting annual net profit in FY21 after five consecutive years of losses. “Apart from trading gains, the return to profitability was supported by lower credit provisions on their legacy non-performing assets, after the high provisions made during the last few years,” ratings company Icra said.

Experts see the revival to be gradual in the second quarter and expected to be much better from September, aided by good monsoon and festive season.

The demand for credit would likely come from the retail and micro, small and medium enterprises segments.



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SBI offers revamping of loan for personal segment borrowers

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State Bank of India (SBI) has announced offering restructuring of loans to its eligible personal segment borrowers who availed home loans, Xpress credit, education loans and auto loans before April 1, 2021.

According to the bank, the eligible borrowers may access the following link and opt for restructuring (under Resolution Framework 2.00).

The link: https://covid19restruct.sbi.co.in:8443/EMIRestruct/EMI_CustomerLogin.jsp

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Not ICICI Bank or HDFC Bank, this lender is the best in India, as per Forbes, BFSI News, ET BFSI

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DBS Bank has been adjudged the best bank of India, ahead of top private banks HDFC Bank and Kotak Mahindra Bank and top lender State Bank of India.

In the third edition of the ‘World’s Best Banks’ list released by Forbes. DBS Bank has clinched the top position in a list of the best banks in India, DBS Bank has won the title for the second consecutive year among 30 domestic and international banks operating in India. The list was compiled by Forbes in partnership with market research firm Statista.

The order

CSB Bank is in the second position, ICICI Bank in the third, HDFC Bank in the fourth. Kotak Mahindra Bank follows at the fifth position while Axis Bank is at the sixth spot. The country’s top lender State Bank of India is in seventh position, followed by Federal Bank at eighth, Saraswat Bank at ninth and Standard Chartered Bank at the tenth spot.

The survey

Over 43,000 banking customers across the globe were surveyed on their current and former banking relationships. Banks were rated on general satisfaction and key attributes like trust, fees, digital services and financial advice, according to Forbes.

DBS Bank India was also 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.



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India Inc cut Rs 1.7 lakh crore debt during pandemic, leave banks high and dry, BFSI News, ET BFSI

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Ignoring the government exhortations to unleash animal spirits and step up investments in the country, India Inc preferred to play safe during the pandemic.

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

According to data analysis SBI research wing, the top 15 sectors with more than 1,000 listed entities reported over Rs 1.7 lakh crore of debt reduction in 200-21.

Refineries, steel, fertilizers, mining & mineral products, and textile alone reduced debt by more than Rs 1.5 lakh crore during FY21.

Fertilizers, mining and minerals, FMCG, cement products, consumer durables, and capital goods were among the sectors where loan reduction of 20 per cent or more was reported during FY21.

According to data from the Reserve Bank of India, loan growth fell to a 59-year low of 5.6% on year as of March 31. Credit was logging a 6.4% in the previous fiscal.

Low interest rates

As interest rates drop to an all-time low, corporates are reducing their loan liabilities to facilitate a lower finance cost, which resulted in the primary issuance of bonds to increase by nine per cent.

The spread of AAA bonds for a 10-year tenor declined from 124 bps in April 2020 to 70 bps in April 2021.

Similarly, the spread for 5 year and 3-year bonds declined from 89 bps and 147 bps in April 2020 to 9 bps and 30 bps in April 2021 respectively.

“This trend is continuing in FY22 also,” said Soumya Kanti Ghosh, Group Chief Economic Adviser, State Bank of India.

These companies not only reduced their loan liabilities at lower finance cost, but also increased their cash and bank balance by around 35% in March, as compared to March 2020, suggesting a conservative approach to conserve cash during uncertain times.

Corporate willingness for new investments also remains tepid as the economy is still recovering from the second wave.



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Banks stare at over Rs 40,000 crore haircut in Videocon resolution, BFSI News, ET BFSI

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Lenders to Videocon Industries face over Rs 40,000 haircut after the National Company Law Tribunal allowed billionaire Anil Agarwal’s Twin Star Technologies to take over Videocon Industries Ltd for about Rs 3,000 crore.

Twin Star, a part of Vedanta Group, will pay around Rs 500 crore within 90 days as upfront payment and the rest as non-convertible debentures over a period of time.

The offer by the Dhoot family entailed repayments until 2035, which was not acceptable to many banks on Videocon’s Committee of Creditors (CoC), according to reports. Dhoot’s settlement offer was made for 13 out of the 15 Videocon group companies, which are jointly going through the Corporate Insolvency Resolution Process (CIRP). Two group companies — KAIL and TREND — were not covered under the offer. Though the bid is less, the Twin Star offer of Rs 3,000 crore is slightly higher than the liquidation amount of Rs 2,600 crore.

Videocon Industries and its 13 group entities owe Rs 61,770 crore to financial creditors. The State Bank of India claim is Rs 11,152 crore while IDBI Bank owes Rs 9,922 crore.

The Committee of the Creditors of Videocon Industries had voted in favour of the resolution plan of Twin Star Technologies Ltd, for 13 group companies with 95 per cent votes on December 11, 2020.

The NCLT order

A two-member Mumbai bench of the NCLT comprising members – H P Chaturvedi and Ravikumar Duraisamy – approved the resolution plan by Twin-Star Technologies.

Videocon Industries also confirmed the development through a regulatory filing. NCLT has pronounced the order on June 8, 2021 (Tuesday) approving the Resolution Plan for the Consolidated Corporate Debtors including the Company, under Section 31 of the Code, it said.

“The Approval Order has not yet been published and is currently awaited. Videocon Industries further informed, “in terms of the Resolution Plan, the equity shares of the Company are proposed to be delisted”.

Accordingly, an appropriate disclosure would be made upon receipt of the copy of the order by the NCLT approving the Resolution Plan, it added. This approval will also now consolidate Vedanta’s hold in Ravva oil field. Vedanta’s interest in Videocon is principally driven by the latter’s 25 per cent stake in the Ravva oil field in the KG Basin.

Following that the resolution plan was moved by the resolution professional before NCLT.

Later, the resolution Plan, as approved by the CoC, was filed with the NCLT for its approval on December 15, 2020. NCLT has conducted a consolidated corporate insolvency resolution process by combining Videocon Industries and other 12 Videocon group companies.



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Banks stare at over Rs 40,000 crore haircut in Videocon resolution, BFSI News, ET BFSI

Banking & Finance

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Lenders to Videocon Industries face over Rs 40,000 haircut after the National Company Law Tribunal allowed billionaire Anil Agarwal‘s Twin Star Technologies to take over Videocon Industries Ltd for about Rs 3,000 crore.

Twin Star, a part of Vedanta Group, will pay around Rs 500 crore within 90 days as upfront payment and the rest as non-convertible debentures over a period of time.

The offer by the Dhoot family entailed repayments until 2035, which was not acceptable to many banks on Videocon’s Committee of Creditors (CoC), according to reports. Dhoot’s settlement offer was made for 13 out of the 15 Videocon group companies, which are jointly going through the Corporate Insolvency Resolution Process (CIRP). Two group companies — KAIL and TREND — were not covered under the offer. Though the bid is less, the Twin Star offer of Rs 3,000 crore is slightly higher than the liquidation amount of Rs 2,600 crore.

Videocon Industries and its 13 group entities owe Rs 61,770 crore to financial creditors. The State Bank of India claim is Rs 11,152 crore while IDBI Bank owes Rs 9,922 crore.

The Committee of the Creditors of Videocon Industries had voted in favour of the resolution plan of Twin Star Technologies Ltd, for 13 group companies with 95 per cent votes on December 11, 2020.

The NCLT order

A two-member Mumbai bench of the NCLT comprising members – H P Chaturvedi and Ravikumar Duraisamy – approved the resolution plan by Twin-Star Technologies.

Videocon Industries also confirmed the development through a regulatory filing. NCLT has pronounced the order on June 8, 2021 (Tuesday) approving the Resolution Plan for the Consolidated Corporate Debtors including the Company, under Section 31 of the Code, it said.

“The Approval Order has not yet been published and is currently awaited. Videocon Industries further informed, “in terms of the Resolution Plan, the equity shares of the Company are proposed to be delisted”.

Accordingly, an appropriate disclosure would be made upon receipt of the copy of the order by the NCLT approving the Resolution Plan, it added. This approval will also now consolidate Vedanta’s hold in Ravva oil field. Vedanta’s interest in Videocon is principally driven by the latter’s 25 per cent stake in the Ravva oil field in the KG Basin.

Following that the resolution plan was moved by the resolution professional before NCLT.

Later, the resolution Plan, as approved by the CoC, was filed with the NCLT for its approval on December 15, 2020. NCLT has conducted a consolidated corporate insolvency resolution process by combining Videocon Industries and other 12 Videocon group companies.



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