Volume XXXI Number 2 October 12, 2015

Weeklies

BI – Business India

BusW – Business World

BusT – Business Today

CMar – Capital Market

EPW – Economic and Political Weekly

SE – Southern Economist

Eco – Economist

For(Asia) – Fortune AsiaCI – Corporate India

Newspapers

BS – Business Standard

ET – Economic Times

FE – Financial Express

FT – Financial Times

H – Hindu

HBL – Hindu Business Line

HT – Hindustan Times

IE – Indian Express

TI – Times of India

Mint – Mint

Classifications

Economy Banking Agriculture & Rural Development Industry Small Scale Industry

International Economics Labour & Personnel Management Management Miscellaneous Books

CONTENTS

A. ECONOMY 1

B. BANKING 3

C. AGRICULTURE & RURAL DEVELOPMENT 16

D. INDUSTRY 16

E. SMALL SCALE INDUSTRY 18

F. INTERNATIONAL ECONOMICS 18

G. MANAGEMENT 20

H. MISCELLANEOUS 21

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BANKERS' BRIEF Vol. XXXI No. 2October 12, 2015

ECONOMY"Direct tax mop-up to miss target, but economy remains strong: FinMin: Sees 7.5%-plus GDP growth;

buoyant indirect taxes to make up for revenue shortfall" – The Finance Ministry said that direct taxcollections will fall short of target this fiscal largely due to sluggish growth in corporate taxes collections. Butthe Centre may come close to meeting the overall revenue projections of Rs.14.5-lakh crore, thanks to thebuoyancy seen on the indirect taxes front. Indirect taxes are growing at a healthy 37 per cent. HasmukhAdhia, Revenue Secretary in the Finance Ministry, said as against the budgeted revenue target of Rs.14.5-lakh crore, the Centre is likely to close the current fiscal with receipts of about Rs.14-lakh crore. A report. –(HBL Oct 6, 2015 p 1)

"Getting real about growth: Government target now in line with IMF's number" – An editorial. – (FEOct 7, 2015 p 6)

"India to remain the world fastest growing economy: IMF" – The International Monetary Fund (IMF)marginally lowered its 2015-16 growth forecast for India, which will still remain the world fastest growingmajor economy, and expressed optimism about its future prospects. IMF now expects the Indian economy togrow 7.3% this year, lower than the 7.5% it projected in July. It expects growth to accelerate to 7.5% thefollowing year. A report. – (Mint Oct 7, 2015 pp 1, 2)

"Indian economy to grow at 7.5% in 2015: Unctad: Growth of global economy expected to remainunchanged from last year at 2.5%" – India's gross domestic product (GDP) is expected to grow at 7.5per cent in 2015, according to a report released by the United Nations Conference on Trade and Development(Unctad). A report. – (HBL Oct 7, 2015 p 4)

"Industry must go beyond seminars & invest" – Excerpts from an interview with Arun Jaitley, financeminister. – (TI Oct 4, 2015 p 9)

"There is space for India in global trading arrangements" – Edited excerpts from an interview withJayant Sinha, Minister of State for Finance. – (Mint Oct 6, 2015 p 29)

"There's no confidence on new investments coming in" – Edited excerpts from an interview with MaheshVyas, Managing Director, Centre for Monitoring the Indian Economy (CMIE). It doesn't look very nice... notvery great. It has been a long wait hoping for an investment pickup. – (Mint Oct 7, 2015 p 29)

"We are away from price pressures, but we have to remain vigilant" – Excerpts from an interview withArvind Subramanian, Chief Economic Adviser. – (HT Oct 2, 2015 p 15)

"What's stopping growth?" – Apart from supply bottlenecks, a demand constraint looms large. An editorial.– (HBL Oct 7, 2015 p 8)

Chakravarty, Manas – "RBI says method of computing GDP deflator misleading" – An article. – (MintOct 6, 2015 p 18)

Chaudhuri, Saumitra – "Grow, but don't let go" – An article. – (ET Oct 8, 2015 p 12)

Chidambaram, P – "Now, do the heavy lifting" – An article. – (FE Oct 4, 2015 p 2)

Roy, Rathin – "Unfinished business" – In any reasonable country, Dr Raghuram Rajan's reputation would bethat of a rate-cutting governor. Cutting rates by 125 basis points within a year, against a background ofpersistently high inflationary expectations, and significant exchange rate management pressures indicatesquite a faith in the curative properties of low interest rates. His irritation with 'savants' is thus perfectlyunderstandable. There is more positive news about the Indian economy today than at any time this decade.The government and the private sector now both need to do their bit to translate this into higher sustainedgrowth. An article. – (BS Oct 2, 2015 p 9)

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BALANCE OF PAYMENTSAcharya, Shankar – "BoP: Beware complacency" – The crisis two years ago was in the making for several

years. An article. – (BS Oct 8, 2015 p 9)

CASHLESS ECONOMY"Payments banks to help in move to 'cashless economy'" – The Finance Minister lays the blame for

incidence of tax evasion on previous governments and their high tax rates. A report. – (H Oct 5, 2015 p 15)

ENVIRONMENT

– CLIMATE CHANGE

"India pledges 35% cut in emissions: Implementation of plan by 2030 will require at least $2.5trillion, with 40% of power coming from non-fossil fuels" – India has pledged to reduce the intensity ofits carbon emissions by up to 35% by 2030 and meet 40% of its energy requirements from non-fossil fuelresources. A report. – (Mint Oct 3, 2015 pp 1, 2)

EXPORTS"Exports of top 5 sectors plunge 25% in Aug" – Exports of top five sectors - engineering, petroleum, gems

and jewelery, textiles and pharmaceuticals - fell by about 25 per cent to $13.33 billion in August due to globaldemand slowdown. These five sectors accounted for about 65 per cent of the country's total merchandiseexports in 2014-15. In August last year, exports of these sectors stood at $17.79 billion. – (FE Oct 3, 2015 p 3)

FOREIGN DIRECT INVESTMENT"Data drive: The FDI boost" – There are reasons for finance minister Arun Jaitley and Prime Minister

Narendra Modi to be upbeat on the foreign investment front. The UK-based Financial Times (FT) reportedthis week that India led the world in FDI during the January-June 2015 period. According to FT, Indiareceived $31 billion, leaving behind China ($28 billion) and the US ($27 billion). The RBI figure puts the FDIfigure in the first half of this year at $28.141 billion. A graphical report. – (FE Oct 3, 2015 p 7)

FOREIGN ECONOMIC RELATIONS

– GERMANY

"Federal Republic of Germany" – A special report on German Chancellor's visit to India. – (FE Oct 5, 2015pp 14-15)

FOREIGN EXCHANGE RESERVES"Forex reserves fall to $350 bn" – India's foreign exchange reserves fell $2.04 billion to $349.98 billion for

the week ended September 25. Foreign currency assets fell $1.98 billion to $326.58 billion. Gold reservesremained unchanged at $18.04 billion. Special drawing rights fell $48.3 million to $4.05 billion, while India'sreserve position with the International Monetary Fund stood at $1.32 billion recording a fall of $11.8 million.– (BS Oct 3, 2015 p 7)

FOREIGN PORTFOLIO INVESTMENTS

– GOVERNMENT SECURITIES

"RBI notifies hike in FPI limits for G-Secs" – The Reserve Bank of India notified that foreign portfolioinvestors (FPI) will be able to hold up to Rs.1.66 lakh crore worth of government securities from October 12onwards, an increase of Rs.13,000 crore from the current limit of Rs.1.53 lakh crore. – (FE Oct 7, 2015 p 8)

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SERVICES SECTOR"Services sector growth slows in Sept: Nikkei Services PMI drops to 51.3, its weakest expansion in

current growth phase" – Services output saw a slight and softer expansion across the country in September,the latest reading of the Nikkei Business Activity Index showed. The index went down to 51.3 in Septemberfrom 51.8 in August. A report. – (HBL Oct 7, 2015 p 1)

SMALL SAVINGS

– INTEREST RATES

"Govt may link PPF returns to bank deposits, RBI's rates" – The Centre may link interest rate on publicprovident funds (PPF) and post office deposits to bank deposit rates or RBI's repo rate and allow for quarterlyor half-yearly reset in returns on small savings schemes. A report. – (TI Oct 4, 2015 p 1)

BANKING

GENERAL"Pain not yet over for banks, but rate cut to offer relief: Debt burden but banks' latest results may

also be challenging as they would choose not to disclose information on composition of loans, sayanalysts" – Banks have been having a rough ride for a couple of years now, thanks to the soaring bad loans,poor demand for fresh loans and shrinking profitability. The September quarter might have been no better forthe state-run banks and some private peers with infrastructure loans but for the Reserve Bank of IndiaGovernor Raghuram Rajan's bonus half a percentage point reduction in policy rates which boosted the valueof their bond holdings. A report. – (ET Oct 8, 2015 p 10)

AXIS BANK"Axis Bank ties up with Snapdeal for collateral-free loans to its sellers" – Axis Bank has partnered with

Snapdeal to launch a pre-approved loan offer designed for small and medium enterprise (SME) sellers. – (FEOct 8, 2015 p 8)

– HOUSING FINANCE

"Axis Bank realigns home loan rates, introduces new slab" – Axis Bank introduced a new slab for itshome loan borrowers with offers starting at 9.6% onward. The newly introduced slab is for loans up to Rs.28lakh. For salaried borrowers, the home loans up to Rs.28 lakh will come at 9.6%, which is only 0.10% overits revised base rate of 9.5%. Loans above Rs.28 lakh will attract 9.65%. A report. – (FE Oct 8, 2015 p 8)

BANK OF BARODALele, Abhijit – "Bank of Baroda awaits new CEO" – Acceptance, working within govt system & staff

relations among the key challenges for the private sector veteran, P S Jayakumar who takes charge thisweek. A report. – (BS Oct 5, 2015 p 16)

– BILL DISCOUNTING FRAUD

"BoB investigating Rs.350-cr bill discounting fraud: Internal probe senior official suspended for irregularities inAhmedabad ops; lender to decide if it has to provide amount in Q2 nos." – Bank of Baroda is investigating abill discounting fraud running into Rs.350 crore. The listed bank, which has suspended a senior official afterit stumbled upon the irregularities in its Ahmedabad operations, will soon have to decide whether to providethe amount in the September-end earnings number. A report. – (ET Oct 6, 2015 p 9)

BANK OF MAHARASHTRA"BoM gets nod for Rs.394-crore issue" – At an EGM held in Pune, shareholders of Bank of Maharashtra

(BoM) approved raising the bank's equity capital through a preferential issue of 10.5 crore equity shares to

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the government at Rs.33.47 apiece, aggregating to Rs.394 crore. Post- issue, the government's shareholdingin the bank will increase to 81.61 per cent from the existing 79.80 per cent, according to a BoM statement. –(HBL Oct 7, 2015 p 10)

– BASE RATE

"BoM cuts base rate by 30 bps" – Bank of Maharashtra cut its base rate by 30 basis points to 9.70%following the 50 bps cut in repo rate by the RBI earlier this week. (This is) a move which will bring down theinterest cost to customers. The reduction is effective from October 5, 2015, according to the bank statement.This will benefit new and existing customers of the bank. – (TI Oct 2, 2015 p 15)

ICICI BANK"ICICI brings in card-less mVisa" – ICICI Bank has become the first institution worldwide to launch mVisa

-a card-less and device-less solution the payments company is betting on in the mobile space. ICICI Bankhas ncorporated the mVisa application in its Pockets app, which allows payments to be made by scanning astatic QR code and entering the amount. The app allows payments to be made by scanning a static QR codeand entering the amount. A report. – (TI Oct 3, 2015 p 19)

– BASE RATE

"ICICI Bank cuts lending rate by 35 bps" – ICICI Bank Ltd said it has cut its base rate by 35 basis points(bps) to 9.35%. In a statement, the lender said that the revised rate would be effective 5 October. ICICIBank joined two other private sector lenders Kotak Mahindra Bank Ltd and Yes Bank Ltd, which reducedtheir minimum lending rates by 25 bps each. A report. – (Mint Oct 2, 2015 p 5)

– DIGITAL BANKING

"A bank in your pocket: ICICI Bank has recorded over 2 million downloads of its digital bankingservice, Pockets, till now" – Quick facts: * ICICI Bank mobile wallet, Pockets, is targeted at first-timecustomers, especially the youth; * Allows users to instantly send or request money to/from an email address,mobile number, Facebook and bank account; * Over 2 million downloads since its launch in February; *ICICI Bank first offering that also targets non-ICICI Bank customers; * Users can also open a zero-balanceaccount with the bank. A report. – (BS Oct 6, 2015 p 7)

– HOUSING FINANCE

"ICICI Bank increases spreads on home loans" – ICICI Bank has increased its spreads on home loanrates and not passed on the entire benefit of base rate cuts to new borrowers. The bank said new womenborrowers and other borrowers will get home loans at a spread of 25 basis points and 30 basis points,respectively, over its base rate of 9.35 per cent. This means women and other borrowers will get home loans(up to Rs.5 crore) from the bank at 9.60 per cent and 9.65 per cent, respectively. The bank said existingborrowers will get the full benefit of the 35-basis-point cut in base rate. A report. – (HBL Oct 7, 2015 p 10)

IDBI BANK"Do not dilute govt stake in IDBI Bank to below 51%, officers' body petitions Jaitley: Wants Finance

Minister to uphold assurances given by his predecessors" – The All-India Bank Officers' Associationhas written to Finance Minister Arun Jaitley urging him not to act on his reported statement that the governmentcould consider the Axis Bank model for holding major stake in IDBI Bank. It has asked the minister to upholdassurances given by his predecessors on the floor of Parliament that government stake in public sectorbanks, including IDBI Bank, will not fall below 51 per cent. As of June-end 2015, the government held 76.50per cent stake in IDBI Bank. A report. – (HBL Oct 2, 2015 p 5)

"Govt exploring options to dilute stake in IDBI Bank" – The government is looking to dilute stake inIDBI Bank through strategic sale or public offering. Various options are being considered, including strategicsale and offer for sale (OFS), for dilution of the government stake in IDBI Bank, but these are at a preliminarystage. A report. – (FE Oct 3, 2015 p 5)

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IDFC BANK"IDFC Bank goes live with 23 branches: Personal banking business will formally start from January

next year" – IDFC Bank went live with a 'soft launch' at 23 locations, including 15 branches in ruralMadhya Pradesh, becoming the 91st scheduled commercial bank in the country. A report. – (HBL Oct 2,2015 p 5)

Sharma, Meghana – "An unconventional makeover: The contemporary wordmark and new identityfor IDFC Bank targets both rural and urban consumers" – The logo reflects this diversity and issymbolic of the upcoming colours of change in banking to meet the rapidly changing expectations of consumers,according to Rajiv Lall, Executive Vice-Chairman and MD, IDFC Bank. An article. – (FE Oct 6, 2015 Supl. p 2)

Vishwanathan, Vivina – "IDFC Bank's personal banking products" – An article. – (Mint Oct 2, 2015 p 21)

INDIAN OVERSEAS BANK"RBI action against IOB as NPAs surge" – Indian Overseas Bank (IOB) informed stock exchanges that

the Reserve Bank of India (RBI) had initiated a 'prompt corrective action' on the lender to improve internalcontrols and consolidate its business activities. The directions given by RBI are for improving the internalcontrol of the Bank and for the purpose of consolidation of the activities of the bank. A report. – (Mint Oct 6,2015 p 5)

"RBI diktat: IOB sets up 'war room' to address NPAs" – Indian Overseas Bank (IOB) has set up whatit calls a 'war room' to address the issues plaguing the bank, including mounting bad assets, after a call by theReserve Bank of India to take 'prompt corrective action'. R Koteeswaran, MD & CEO, IOB, said RBI'sonly aim was to shore up the bottom line of the bank. Though we have been making steady progress inrecoveries and maintaining decent operating profits, the ballooning NPAs have been eating into our profits. Areport. – (FE Oct 7, 2015 p 8)

"RBI has not capped our lending: IOB" – The Reserve Bank of India (RBI), which has initiated correctiveaction against Indian Overseas Bank (IOB), asked the Chennai-based lender to lower its bad loans, but notplaced any curbs on lending, according to R Koteeswaran, managing director and chief executive of thebank. The regulator had not stipulated any target to reduce IOB non-performing assets, but gave it one yearto improve its profitability and current and saving deposits. A report. – (Mint Oct 7, 2015 p 7)

"RBI pulls up bosses for IOB mess" – The Reserve Bank of India (RBI) has initiated corrective action atIndian Overseas Bank (IOB) on the grounds that its management is unable to revive it. IOB has reported lowreturn on assets for four consecutive quarters from July 2014. The bank branch expansion and recruitmenthave been curtailed but no lending curbs have been imposed. In a note to the Chennai-based bank, alsomarked to the government, RBI said its management was not proactive in arresting the decline in performance.A report. – (BS Oct 7, 2015 p 1)

KARUR VYSYA BANK"There's a need to stimulate credit demand: KVB chief: Bank cuts base rate by 35 bps to 10.40%"

– Karur Vysya Bank has decided to slash its base rate by 35 basis points to 10.40 per cent and the benchmarkprime lending rate (BPLR) from 15.75 per cent to 15.40 per cent, effective from October 5. The rate ofinterest on deposits of less than Rs.1 crore is also expected to go down by 25 bps. Commenting on thisdecision, KVB's Chief Executive K Venkataraman told that there is a need for stimulating credit demand. Areport. – (HBL Oct 2, 2015 p 5)

KOTAK MAHINDRA BANK

– CREDIT CARD FRAUD

"Bank left Rs.2.84 cr poorer after credit card data stolen" – Kotak Mahindra Bank recently detected amassive fraud in which 1,730 transactions worth Rs.2.84 crore were carried out using credit cards it hadnever issued. The cards, 580 in all, were fabricated by the fraudsters and used for online shopping andmaking payments in seven countries-Canada, USA, UK, Germany, Brazil, France and India-between July 2and September 10. A report. – (TI Oct 6, 2015 pp 1, 9)

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RBL BANK (RATNAKAR BANK)"RBL Scoops up Rs.500 Cr, Value Balloons to 75% of Bank of India: ADB, CDC & family offices

among entities investing at Rs.190-200 per share" – RBL Bank has been valued at nearly three-fourths the market cap of public sector biggie Bank of India in a pre-IPO round led by Asian DevelopmentBank (ADB) and existing investor and private equity firm CDC. A report. – (ET Oct 2, 2015 p 1)

RESERVE BANK OF INDIA"Centre's delay in approving pension updation scheme irks RBI retirees" – Reserve Bank of India

retirees are frustrated over the Centre delaying final approval to the pension updation scheme of the apexbank. The in-principle approval came during March 2014, recall retirees. A report. – (HBL Oct 8, 2015 p 10)

STATE BANK OF BIKANER AND JAIPUR"SBBJ launches Mudra Card" – Jyoti Ghosh, MD, State Bank of Bikaner & Jaipur has launched SBBJ

MUDRA card under Pradhan Mantri Mudra Yojna (PMMY) on Oct, 29th. – (ET Oct 5, 2015 p 6)

STATE BANK OF INDIA"SBI partners German bank for rural lending" – State Bank of India and the German development bank

KfW, have concluded a $300 million (Rs.1,956 crore) loan facility to support rural and micro-enterpriselending in India. The loan has a maturity of 15 years. – (FE Oct 8, 2015 p 8)

"We are the cheapest in the market at 9.55%: SBI chief Arundhati Bhattacharya explains the bank20 basis point cut in home loan rates" – An interview with SBI Chief Arundhati Bhattacharya. This timethe base rate cut has been quite huge at 40 basis points, we have currently passed on 20 basis points to newhome loan owners, not to the old ones, according to Arundhati Bhattacharya, Chairperson, SBI. – (HBL Oct6, 2015 p 6)

– HOUSING FINANCE

"SBI tinkers with spread, passes on lower benefit to new home loan borrowers" – Borrowers havebeen rejoicing at various banks announcing 30-35 basis points cut in their base rates (minimum lending rate),after the RBI slashed its key policy rate by 50 basis points last week. But home loan borrowers may not seethe full benefit of such cuts being passed on to their rates, if the latest move by SBI is any indication. Thebank announced a 40 basis point reduction in base rate last week. But it has lowered its home loan rates byjust 20 basis points, from 9.75 per cent to 9.55. These rates will be applicable to new borrowers effectiveOctober 5. A report. – (HBL Oct 5, 2015 p 1)

SYNDICATE BANK"Syndicate Bank raises Rs.1,000 cr" – Syndicate Bank has raised Rs.1,000 crore by issuing tier-II bonds

through private placement. The bank has finalised the issue of unsecured redeemable non-convertible Basel-III complaint tier-II bonds in the nature of debentures aggregating to Rs.1,000 crore. – (HBL Oct 2, 2015 p 5)

UCO BANK"Strategic debt restructuring is yet to develop in India" – Edited excerpts from an interview with Charan

Singh, Executive Director, UCO Bank. – (BS Oct 3, 2015 p 7)

UNION BANK OF INDIA"Union Bank buys KBC Asset's 49% stake in joint venture" – Union Bank of India will buy KBC Asset

Management's 49 per cent stake in Union KBC Asset Management. A report. – (HBL Oct 6, 2015 p 10)

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VIJAYA BANK

– BASE RATE

"Vijaya Bank cut base rate to 9.65%" – Vijaya Bank has announced a reduction in its base rate by 20 basispoints with effect from October 8 pursuant to the cut in repo rate announced by RBI last week. Accordingly,the revised base rate will be 9.65 per cent per annum as against the existing rate of 9.85 per cent. Since June2015, the Bank has so far effected 60 bps reduction in its base rate. With the latest reduction in base rate, itis expected that the sluggishness in credit offtake shall ease and poised to grow further. Further, the retailconsumer front shall stand to benefit, especially housing and vehicle segment. – (HBL Oct 5, 2015 p 18)

YES BANK"YES Bank, MatchMove Pay tie up" – YES Bank has announced a tie-up with Singapore-based MatchMove

Pay that will enable the bank's customers who do not own credit cards or even online banking facilities toimmediately start making purchases online or in-app. Initially, MatchMove Pay, which is a mobile paymentplatform provider, will launch its mobile wallet platform-as-a-service in India through YES Bank's infrastructure,thereby offering the latter's customers an alternative online payment solution via its pre-paid virtual cardslicensed by MasterCard, the private sector bank said in a statement. It added that the next stage of growthwill see YES Bank and MatchMove extending the platform in a co-branded model to airlines, e-commercestores, and lifestyle apps to enable in-app, one-click purchases instantly, safely and easily. – (HBL Oct 8,2015 p 10)

ARAB COUNTRIES"Arab banking and finance" – A special report. – (FT Oct 7, 2015 Supl. pp 1-8)

EUROPE

– EUROPEAN CENTRAL BANK

"Bankers guided on how to talk to private sector" – The European Central Bank has set out guidelines forhow top central bankers should interact with the private sector, after a spat over information divulged by oneof its board members at a private event earlier this year. A report. – (FT Oct 7, 2015 p 4)

"Communication remains the right tool for Draghi" – The case for further stimulus is not yet clear. Betterto watch and wait. An editorial. – (FT Oct 2, 2015 p 10)

UK"UK banking's sorry tale draws slowly to a close" – Mis-sold payments insurance showed the industry at

its very worst. An editorial. – (FT Oct 3, 2015 p 8)

BANCASSURANCE"Banks to be accountable for mis-selling insurance" – Banks will be made accountable for any insurance

product mis-sold through them, according to T S Vijayan, Chairman, Insurance Regulatory and DevelopmentAuthority of India. – (ET Oct 3, 2015 p 4)

"Banks to be liable for the insurance they sell: Irdai chief T S Vijayan says intermediaries shouldwork in the best interest of insurance policyholders" – The Insurance Regulatory and DevelopmentAuthority of India (Irdai) is set to make corporate agents, including banks and their employees, liable for allinsurance policies they sell. Irdai Chairman T S Vijayan said the regulator would consider corporate agentsan intermediary, which would benefit the customer. As of now, corporate agents are considered entitiesworking on behalf of an insurance company, a distributor of its products. An insurance broker, on the otherhand, sells products of multiple insurers. While an insurance broker can be held liable for the sale of aproduct, agents can't. A report. – (BS Oct 2, 2015 pp 1, 14)

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"IRDA crackdown on MIS-selling: Banks & insurers may have to rethink tie-ups" – Rather thanbeing just distributors, banks may seek equity partnerships. Bancassurance, the sale of insurance productsthrough banks, which is the most preferred route for growth of the sector, may be at risk. A report. – (ET Oct8, 2015 p 10)

Kumar, Dhirendra – "IRDA's latest rules an attempt to clean up bancassurance" – It very muchremains to be seen whether IRDA's focus on the actual employee, or its shifting of liability to banks willactually have any effect. An article. – (ET Oct 5, 2015 p 8)

BANK CAPITAL

– BANK OF INDIA / UNION BANK OF INDIA

"BoI, UBI issue equity shares worth Rs.3,534 crore" – Bank of India (BoI) and Union Bank of India(UBI) have issued equity shares worth Rs.2,455 crore and Rs.1,079 crore respectively to the government onpreferential basis for capital infusion. A report. – (FE Oct 4, 2015 p 11)

BANK LENDING

– SUGAR MILLS

"Banks get 15 days to lend to sugar mills" – The government has given 15 more days to banks fordisbursing Rs.1,900 crore soft loans to sugar mills to help them clear cane arrears to farmers that total overRs.12,000 crore. Out of the Rs.6,000 crore soft loan approved by the government to bail out the sugarindustry, mills applied to avail loans for only Rs.2,700 crore. However, banks have been able to disburse onlyRs.800 crore till the 30 September deadline and the rest Rs.1,900 crore is still to be given. – (Mint Oct 3, 2015 p 9)

BANKING ABROAD

– UK

"New rules force banks to capitalize UK units: FT report" – Some of India biggest banks like the StateBank of India (SBI) are being forced to inject hundreds of millions of pounds to capitalise new UK subsidiariesunder new rules. A recent tightening of regulations by the Bank of England for foreign banks offering retailservices to UK consumers means that as many as 50 overseas lenders with branches in the country couldface similar obligations, 'The Financial Times' reported. – (Mint Oct 5, 2015 p 3)

BANKING REGULATOR"Rate cut to boost investments: Rajan" – It (the relationship with finance minister Arun Jaitley) has been

great. I think these reports of differences tend to exaggerate and sometime over-complicate what is essentiallya very strong relationship, according to Raghuram Rajan, Governor, RBI. – (HT Oct 7, 2015 p 13)

BANKING TECHNOLOGY

– FINANCIAL SOFTWARE AND SYSTEMS

Ramakrishnan, N – "A brilliant conductor of banking orchestras: Nagaraj Mylandla's company helpsbanks operate ATMs, reconcile accounts" – It is a critical role we play in the banking industry. Everybank is touched by us in some form or the other, according to Nagaraj V Mylandla, Managing Director,Financial Software & Systems. An article. – (HBL Oct 6, 2015 p 2)

BASE RATE"More banks cut lending rate: Home loans to get cheaper: Union Bank" – With big banks, such as

State Bank of India and ICICI Bank cutting their base rates (or the minimum lending rates) over the last oneweek, more banks joined the bandwagon. Union Bank of India reduced its base rate by 0.35 percentagepoints to 9.65 per cent from 10 per cent. Standard Chartered too announced a reduction of 0.25 percentage

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points in its base rate from the current level of 9.75 per cent to 9.50 per cent. State Bank of Mysore hasrevised downward its base rate to 9.65 per cent from 9.90 per cent, effective from October 7. CorporationBank has announced a reduction of 20 basis points in its base rate. A report. – (HBL Oct 6, 2015 p 10)

Kulkarni, Preeti – "Will new base rate formula help you?" – RBI is set to introduce a new formula forcalculating the base rate. Here's what it will mean for borrowers. An article. – (ET Wealth Oct 5, 2015 p 8)

– BANK LENDING

"After RBI move, more banks cut lending rates" – Syndicate Bank and United Bank of India cut theirbenchmark lending rates by up to 0.30%, making home and auto loans cheaper for new as well as existingcustomers. Karur Vysya Bank also announced a cut in its base rate by 0.35% to 10.40%.The new rate iseffective from October 5, according to the bank statement. The rate cut has been triggered by RBI revisingdownward its benchmark short-term lending (repo) rate by 0.50% in its fourth bimonthly monetary policyreview. Following this, about 20 banks from public and private sectors have cut interest rates by up to 0.40%.A report. – (FE Oct 4, 2015 p 11)

– BANK OF INDIA

"Bank of India cuts Base Rate" – Bank of India has decided to reduce its Base Rate by 25 basis points to9.70 per cent (from existing 9.95 per cent). The revised Base Rate would take effect from October 5, 2015.– (ET Oct 5, 2015 p 6)

– CENTRAL BANK OF INDIA

"Central Bank of India reduces Base Rate" – Central Bank of India has made downward revision of BaseRate by 25 basis points with effect from 8th October. Accordingly, the Base Rate is revised from existing9.95 per cent to 9.70 per cent. – (ET Oct 5, 2015 p 6)

– JAMMU & KASHMIR BANK

"J&K Bank slashes base rate" – J&K Bank said that it has reduced its base rate by 35 basis points to 9.50per cent from 9.85 per cent with immediate effect. – (HBL Oct 8, 2015 p 10)

– STATE BANK OF HYDERABAD

"SBH cuts base rate by 20 bps" – The State Bank of Hyderabad (SBH) has reduced its base rate by 20 basispoints from 9.95 per cent to 9.75 per cent with effect from October 8. Following the recent announcement ofa reduction in policy rates by the RBI. – (HBL Oct 7, 2015 p 10)

– STATE BANK OF MYSORE

"SBM cuts base rate by 25 bps" – State Bank of Mysore has reduced base rate by 25 basis points to 9.65%with effect from October 7. – (FE Oct 7, 2015 p 8)

BILL DISCOUNTING"RBI to tighten bill discounting norms" – With increasing cases of fraud coming to light, especially in the

gems & jewellery and textiles sectors, the RBI is likely to tighten guidelines relating to bill discounting forbanks. What is bill discounting?: * It is a transaction where a firm sells its accounts receivable at a discountedvalue to banks; * This helps the firm meet its working capital requirement without taking loans; * If the buyeror seller doesn't honour the transaction due to mala fide intentions, it leads to fraud; * There may be genuinereasons, but in the recent past many cases of fraud have surfaced. A report. – (HBL Oct 7, 2015 p 10)

COOPERATIVE BANKING"RBI panel's suggestions: UCB federation to set up 3-member panel" – The National Federation of

Urban Cooperative Banks and Credit Societies Ltd, an apex body of these lenders, will form a three-membercommittee which will present its objections against RBI panel's recommendation on urban cooperative banks(UCBs). A report. – (TI Oct 5, 2015 p 13)

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CROWD FUNDINGPersaud, Avinash – "Crowd financing is not banking" – A large part of the problem of financing development

is not the absence of cash, but an inability to mobilize it. An article. – (Mint Oct 7, 2015 p 31)

CUSTOMER SERVICE"After telecom, banking on govt's radar for poor service quality" – The telecom sector is not the only

one where the regulator has cracked the whip on service quality. The RBI is planning to follow suit, withregulatory action expected on a charter of consumer rights that the banking regulator has developed afterpublic consultation last year. Under this, the RBI will intensify field visits to check mis-selling as well as theproper functioning of bank infrastructure such as branches and ATMs. There have been mounting complaintsfrom customers on bank infrastructure such as ATMs either not working or being out-of-cash for extendedperiods of time, especially over the weekends. A report. – (IE Oct 5, 2015 p 13)

DEPOSITOR AWARENESS"20 entities to get funding for promoting depositor awareness: XLRI Jamshedpur, Indian School of

Microfinance for Women among those selected by RBI" – The Reserve Bank of India released thenames of 20 entities selected for grant of financial assistance from the Depositor Education and Awareness(DEA) Fund. These 20 entities, including Consumer Education and Research Society (Ahmedabad), ConsumerUnity & Trust Society (Jaipur), Xavier Labour Relations Institute (Jamshedpur), and Indian School ofMicrofinance for Women (Ahmedabad), have been selected out of 90 applications received for registration.A report. – (HBL Oct 2, 2015 p 5)

EXECUTIVE APPOINTMENTS

– PUBLIC SECTOR BANKS

"Govt set to elevate 4 EDs as PSB heads" – The government has identified four executive directors ofpublic sector banks for appointing them as managing directors, taking forward the appointment processwhich entailed selecting at least two candidates with experience in the private sector. Sources said IndianBank executive director MK Jain is expected to be elevated as MD of the Chennai-headquartered lender. JK Garg, who currently is executive director at UCO Bank, is likely to move to Corporation Bank as MD,while S N Patel will head from Oriental Bank of Commerce to Andhra Bank, if his appointment is cleared bythe appointments committee of cabinet. R K Thakkar, who is executive director at Dena, may be headed toUCO Bank as managing director. Punjab National Bank executive director K Bramhaji Rao and AndhraBank's S K Kalra are said to be on the waiting list. A report. – (TI Oct 7, 20158 p 21)

FINANCIAL INCLUSIONTripathi, Ashutosh Kumar – "A pointless number chase" – Financial inclusion is meaningful only if the poor

are enabled to actually use such services. An article. – (HBL Oct 8, 2015 p 8)

FINANCIAL SECTORSchuknecht, Ludger – "What bankers can teach stimulus-addicted economists" – Macroeconomic

myopia contrasts with much more convincing global action to repair the financial sector. An article.– (FT Oct 6, 2015 p 13)

FOREIGN BANKING

– DOHA BANK

"Doha Bank to open 12 branches in 3 years" – After waiting for nearly eight years, Qatar-based Doha Bank hascommenced business with its first branch in Mumbai. The bank, which is looking to float a new subsidiary, isplanning to have at least 12 branches and exposure of $5 billion in India. – (BS Oct 7, 2015 p 7)

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FORWARD MARKET"RBI buys over one-year forward $ to limit swap outflow impact in 2016" – The Reserve Bank of India

(RBI), perhaps for the first time in many years, has booked dollar/rupee forwards exceeding one-year tenureof up to $3.04 billion during July and August, data from the central bank showed. A report. – (FE Oct 8, 2015 p 8)

GOLD MONETISATION SCHEME"Gold monetisation, bond schemes to be launched in Nov" – The government said the proposed schemes

on gold monetisation and sovereign gold bonds would be launched next month, as they aimed to wideninvestment options for individuals as well as households and also discourage imports of the precious metal. Areport. – (FE Oct 6, 2015 p 2)

HOUSING FINANCESharma, Ashwini Kumar – "Banks may charge higher interest rate on home loans with high risk

weight" – An article. – (Mint Oct 5, 2015 p 15)

IBA

– DENA BANK

"Dena Bank" – Shri Ashwani Kumar, a veteran banker, and Chairman and Managing Director of Dena Bankhas been elected as Chairman of Indian Banks Association (IBA). – (BS Oct 6, 2015 p 10)

INTEREST RATESBandyopadhyay, Tamal – "How real is real interest rate?" – An article. – (Mint Oct 5, 2015 p 9)

Merwin, Radhika – "Rate cut: borrowers gain is depositors loss: Some banks have been trimmingtheir savings deposit rates too" – An article. – (HBL Oct 3, 2015 p 9)

– BANK LENDING

Merwin, Radhika – "Lending rates are falling, Really?" – Ask borrowers if they feel the difference. Anarticle. – (HBL Oct 8, 2015 p 8)

– DEPOSITS

Merchant, Krishna – "Real bank deposit rates at highest level in 15 years" – An article. – (Mint Oct 7,2015 p 18)

– INDIAN BANK

"Indian Bank cuts FCNR deposit rates" – Indian Bank has decided to cut its foreign currency non-resident(banking) deposit rates. In case of FCNR(B) deposits, in US dollars, for three years and above but less thanfour years, the rates have been revised to 2.51% from the existing 2.76%. Interest rates for deposits of fouryears and above but less than five years have been revised to 2.73% from the existing 2.98%. For depositsof up to five years, interest rates have been fixed at 2.92% from existing the 3.17%. – (Mint Oct 5, 2015 p 10)

LOAN RESTRUCTURING

– POWER SECTOR

"Discoms' Loan Recast to Rerate PSBs: PSU banks can upgrade Rs.4.3 lakh crore loans of 9 statepower distribution cos to standard category if the plan to restructure the loans is approved" –Shares of state-owned banks such as Punjab National Bank, Canara Bank, Bank of India and others thathave underperformed the market so far this year may get rerated if the government clears the plan torestructure Rs.4.3 lakh crore loans of nine state power distribution companies. Analysts said if the plan is

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approved, PSU banks will be able to upgrade these loans to standard category, which will bring down riskweightage to 20% from current risk weight of 125%. Lowering of the minimum risk weight means banks willhave to set aside less capital for the sector, leading to availability of more funds for lending to other segments.PSU banks and infrastructure lenders may get rerated if the government considers loan restructuring of statepower distribution companies, along with power sector reforms, including tariff hikes. A report. – (ET Oct 8,2015 p 9)

"Government plans debt relief for ailing power retailers" – The centre is planning to restructure loans ofsome unprofitable regional electricity retailers by getting state governments to take over their liabilities,according to people familiar with the matter. A report. – (Mint Oct 2, 2015 p 2)

MICROFINANCE

– SKS MICROFINANCE

"SKS Microfinance sees bigger pie as rivals become banks" – SKS Microfinance Ltd says being the solemicrolender among India's top five to be denied a banking permit may help it cut costs. After rivals gotapprovals last month to become 'small finance banks,' the pie just got bigger for SKS, President S Dilli Rajsaid in an interview. The company will become a major beneficiary of funds flowing from bigger banksseeking to meet so-called priority-sector loan obligations, helping lower costs by as much as 100 basis pointsin a year. – (FE Oct 7, 2015 p 18)

– SMALL FINANCE BANKS

Merwin, Radhika – "Make way for MFIs" – Microfinance institutions or MFIs may finally be winning theirmoment under the sun. Of the 10 small bank licences, the RBI has given as many as eight to MFIs. Bandhan,the largest MFI in the country, also bagged the coveted universal bank licence last year. A graphical report.– (HBL Oct 2, 2015 p 9)

MOBILE BANKING"Mobile banking largely an urban phenomenon, says RBI arm" – Mobile banking has finally arrived in

urban and semi-urban areas. About 90 per cent of the users of mobile banking are from these regions,according to findings of a study conducted by the Institute for Development and Research in BankingTechnology (IDRBT), an arm of the Reserve Bank of India. A report. – (HBL Oct 5, 2015 p 18)

MOBILE WALLETS"Mobile wallets may well be the future of retail banking: Transactions via wallets double in a year,

outpace increase in credit card volumes, as use of handheld devices rises" – If anyone had anydoubts about where the future of retail banking is headed, here's the answer: wallets and similar stuff storedin handsets. Just as radios and tape-recorders have given way to downloads, it may not be long before debitand credit cards make room for wallets and other prepaid instruments, if the growth data from RBI isanything to go by. A report. – (ET Oct 8, 2015 p 9)

Kapoor, Lokvir – "Can mobile wallets pave the way to a cashless economy?" – Until October 2014, RBIput the number of credit cards issued by 55 scheduled commercial banks at 19.1 million. The country's topmobile wallet company, Paytm, alone has over 80 million users. Point of Sale (PoS) based services, whichfacilitate the mobile wallet payments at retail shops, can benefit to consumers and merchants alike. Anarticle. – (FE Oct 5, 2015 p 7)

MONETARY POLICY"Deepending financial markets: RBI must assess both risks and benefits of its recent moves" –

Coverage of last week's monetary policy announcement by the Reserve Bank of India (RBI) paid attentionalmost entirely to the higher than expected reduction in the repo rate. However, this statement also containedthe bi-annual Part B of the monetary policy review, announcing regulatory and developmental measuresrelating to banking, financial markets and other domains in the RBI's jurisdiction. Of particular significance

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were several measures relating to foreign portfolio investment (FPI) in government securities, the freedomfor Indian corporate groups to issue rupee-denominated bonds offshore, and an expansion of the list ofeligible participants in the currency markets, both in exchange-traded and over-the-counter (OTC) products.An editorial. – (BS Oct 8, 2015 p 9)

Bhattacharaya, Himadri and Sivakumar, Sivaprakasam – "Reserve Bank of India's surprise rate cutputs its long-term credibility at risk" – In financial markets, as in life, surprises are rare, by definition.Major central banks, with the exception of the People's Bank of China, perhaps, tweak their policy rates by25 basis points at one go on most occasions. An article. – (H Oct 4, 2015 p 15)

Chakravarty, Manas – "Has central bank decided to ignore household inflation expectations?" – Anarticle. – (Mint Oct 5, 2015 p 15)

Kohli, Renu – "Growth concerns out in the open: Whether the rate-cut came too late in the day in anenvironment of inadequate transmission remains to be seen" – All evidence against a recovering-economy story were ignored as RBI remained focussed on taming inflation and anchoring inflationaryexpectations of the public so as to create the ground for solid, long-term growth. So, what led the central bankto change course? An article. – (FE Oct 5, 2015 p 6)

Malik, Rajeev – "Tracking the Rajan put: Don't expect a series of rate cuts from here on, thoughbonds remain attractive" – An article. – (Mint Oct 6, 2015 p 31)

Mishra, Neelkanth – "The big bond reform" – RBI raising limits for foreign investors holding governmentbonds is more significant than the rate cut. It is also unclear what the limited cuts in bank lending rates can doto revive the corporate investment cycle. Historically, corporate loan demand doesn't correlate well withinterest rates - that is, lower rates don't drive more borrowing. It will also not, in all likelihood, relieve stressfor over-leveraged companies: even if the entire repo rate cut were transmitted, the number of companiesnot able to pay interest on their outstanding debt would not change by much. That is because the debt burdenis too high. An article. – (IE Oct 2, 2015 p 8)

Narasimhan, C R L – "Nowhere to go" – The 50 basis point repo rate cut has created such an impactbecause it indicates a sharp reversal of the RBI stance on the inflation-growth dynamics. An article.– (H Oct 5, 2015 p 16)

Tarapore, S S – "Miles of smiles but problems await" – Continuing reductions in interest rates will affectfinancial savings and, ultimately, the growth of the economy. An article. – (HBL Oct 2, 2015 p 8)

– GOVERNMENT BONDS

"RBI actions to bring annual FPI funds of Rs.48,000 crore" – According to domestic rating agency IndiaRatings, RBI's front loaded monetary action and accompanying policy changes have a significant positivesfor fixed income and the rupee. Close to $4 billion is expected in foreign flows into government securitiesalone as the first two tranches of limit increase in the coming October-January period - India Ratings. Areport. – (H Oct 5, 2015 p 15)

– STOCK MARKET

"Has RBI policy put a floor under stocks, temporarily?" – The steeper-than-expected rate cut by theReserve Bank of India (RBI) on 29 September appears to have put a floor under the domestic equitymarkets, at least temporarily. A report. – (Mint Oct 6, 2015 pp 3-4)

MONETARY POLICY TRANSMISSION"Banks should pass on rate cut to consumers" – Edited excerpts from an interview with A M Naik,

Executive Chairman, Larsen and Toubro Group. – (Mint Oct 2, 2015 p 29)

"Banks to face RBI heat for not passing on base rate cut benefit: Central bank sees action asdiscriminatory, unfair" – The Reserve Bank of India (RBI) is not comfortable with the fact that commercialbanks are not passing the entire benefit of base rate cut to the new customers and likely to engage with thelenders to correct the situation. A report. – (BS Oct 8, 2015 p 16)

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"Monetary transmission" – Banks were quick to bring down interest rates last week in response to thestrong rate action by the Reserve Bank of India. Quick edit. – (Mint Oct 5, 2015 p 1)

Joshi, Dharmakirti – "Look beyond Mint Road" – More needs to be done to reduce the delay in interestrate transmission in India. An article. – (IE Oct 3, 2015 p 9)

Rajwade, A V – "Monetary transmission, base rates and ALM" – The transmission of monetary policysignals to the real economy has been poor in recent years even in the advanced industrial economies despitethe sophistication of their financial markets. An article. – (BS Oct 8, 2015 p 8)

NON-PERFORMING ASSETS

– FINANCIAL STATEMENTS

"Banks want bad loan mismatch disclosure postponed till 2018" – After the Reserve Bank of India(RBI) asked commercial banks to disclose any mismatch on bad loans and provisioning in their financialstatements, bankers have requested that this be postponed till January 2018. In its policy review this week,the regulator has observed that there are divergences between what banks report on bad loans and provisioningas compared to what RBI supervisors report, and that mismatch needs to be disclosed in the financialstatements. While RBI has not gave any timeframe on when this will be implemented, it has said instructionswill shortly be issued. The move is aimed at bringing greater transparency in reporting the financial numbers.A report. – (BS Oct 3, 2015 p 7)

– RESTRUCTURED LOANS

"Consulting firms' role in stressed assets under RBI scanner: Cos drafting the project report alsoconduct audits, followed by loan restructuring, complain bankers" – The role of big consulting firms- even with foreign parentage - in creating sick and stressed assets has come under fire of the regulatorReserve Bank of India (RBI) and public sector banks. Huge debts: Out of around 530 borrower accountswith restructured loans of Rs.4,03,004 crore cases approved by banks, 178 cases involving Rs.67,667 crorehave already failed another 20 per cent is on the verge collapse in the current year. * Banks are now handling269 live cases involving a debt of Rs.2,74,026 crore. * The CDR process, including the status report, ofalmost all of them are handled by consultants. A report. – (IE Oct 4, 2015 p 15)

PAYMENTS BANKS"Banks investing in payment banks will not be treated as promoters" – Banks picking up stakes in

payments banks that have received licences will not be treated as promoters of the bank, and their directorson the board are unlikely to be treated as independent directors by the Reserve Bank of India. A report.– (HBL Oct 6, 2015 p 10)

"Payments banks need to share networks" – RBI governor Raghuram Rajan has indicated that he wantsinteroperability among the new payments banks. What this means is that banks should be able to use eachother networks for providing services. We hope that as they (payments banks) progress they have commonstandards, so that there is interoperability. A report. – (TI Oct 3, 2015 p 19)

Prabhu, K N V – "Payment banks or payment companies" – An article. – (SE 54(10) Sep 15, 2015 pp 7-8)

PAYMENTS SYSTEMS"Jan-Dhan, Payments bank to lift non-cash transactions in India" – Increasing Internet penetration and

adoption of mobile payments in India and China will drive the growth of non-cash transaction growth inemerging Asia, according to a Capgemini and Royal Bank of Scotland (RBS) report. A report. – (Mint Oct 7,2015 p 6)

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PRIVATE SECTOR BANKS

– FOREIGN DIRECT INVESTMENT

"RBI expresses reservation over 100% FDI in private banks" – The Reserve Bank of India (RBI) hasraised reservations over a proposal to allow 100 per cent foreign direct investment (FDI) in private banks asit might create regulatory problems. According to sources, the central bank is of the view that 100 per centFDI may complicate regulations for private and foreign banks. A report. – (H Oct 2, 2015 p 17)

PUBLIC SECTOR BANKS"Bank earnings preview: Asset quality pressure to ease" – Treasury gain to boost earnings but profitability

of PSBs to remain under pressure. A report. – (BS Oct 8, 2015 p 11)

– BANK STOCKS

Agarwal, Sheetal – "Power boards' loan rejig not end of woes for PSB: Increasing stress in metalssector and capitalisation needs are key worries" – The government's plan to restructure the loans ofstate electricity boards (SEBs) by making the respective state governments liable for the debt, led to a surgein banking stocks. An article. – (BS Oct 6, 2015 p 10)

SMALL FINANCE BANKS"Small finance banks seek to plug Rs.1-10 lakh loan gap: Target group for small finance banks to

essentially overlap with that of government's Mudra initiative" – Apart from other prudential normsthat apply to scheduled commercial banks, small finance banks must ensure that loans up to Rs.25 lakh makeup 50% of their portfolio. A report. – (Mint Oct 5, 2015 p 5)

Ramachandra, Aparna – "Seven healthy habits for the new small finance banks" – An article. – (MintOct 5, 2015 p 14)

– MFIs - EAST ZONE

Ray, Atmadip – "Blocked bridge to east: Why Rajan turned a blind eye: Was it the fear of risk thatdrove RBI to ignore three eastern MFIs?" – An article. – (ET Oct 7, 2015 p 14)

STRATEGIC DEBT RESTRUCTURING"Lenders to take over consolidated construction" – Four major banks - SBI, BoB, IDBI and ICICI - are

going to take a combined 53.63% equity stake in consolidated construction consortium (CCCL), an entitybased in Chennai. A report. – (BS Oct 8, 2015 p 3)

"SBI, ICICI, Axis Bank lead push for strategic debt restructuring" – Lanco Infratech Ltd lenders hadhad enough. The infrastructure company had made plenty of promises during its debt-restructuring negotiationswith banks in 2013 as it sought to recast about Rs.7,000 crore in loans. A year and a half later, only a few ofthose promises had been honoured. A report. – (Mint Oct 5, 2015 pp 1, 10)

WHITE-LABEL ATMs"White-label ATMs get a fresh lease of life" – White-label automated teller machines (ATMs), which have

been growing at a slow pace, are set to get a fresh lease of life with payments and small finance banksexploring options for tie-ups with them rather than having their own cash dispensation machines. This willhelp the niche banks keep their operating expenses under control. A report. – (BS Oct 5, 2015 p 5)

RBI CIRCULARS"Auction of Government of India Dated Securities" – (RBI Circular RBI/2015-2016/197 Ref.No. IDMD/

670/08.02.032/2015-16 dated 05.10.2015)

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"Implementation of Section 51-A of Unlawful Activities Prevention Act (UAPA), 1967 - Update datedSeptember 30, 2015 and October 2, 2015 of Al-Qaida Sanctions List" – (RBI Circular RBI/2015-2016/199 DBR.AML.No. 4897/14.06.001/2015-16 dated 07.10.2015)

"Individual Housing Loans: Rationalisation of Risk-Weights and LTV Ratios" – (RBI Circular RBI/2015-2016/200 DBR.BP.BC.No. 44/08.12.015/2015-16 dated 08.10.2015)

"Investment by Foreign Portfolio Investors (FPI) in Government Securities" – (RBI Circular RBI/2015-2016/198 A.P. (DIR Series) Circular No 19 dated 06.10.2015)

"Memorandum of Procedure for channeling transactions through Asian Clearing Union (ACU)" –(RBI Circular RBI/2015-2016/203 A. P. (DIR Series) Circular No. 21 dated 08.10.2015)

"Risk Management & Inter-Bank Dealings: Booking of Forward Contracts - Liberalisation" – (RBICircular RBI/2015-2016/201 A. P. (DIR Series) Circular No. 20 dated 08.10.2015)

"Risk Weights for Claims on Foreign Central Banks" – (RBI Circular RBI/2015-2016/202DBR.BP.BC.No.43/21.06.001/2015-16 dated 08.10.2015)

AGRICULTURE & RURAL DEVELOPMENT

AGRICULTURAL FINANCE"Banks jittery as deficient monsoon puts Rs.8 lakh cr of farm loans at risk: Begin recasting some

loans to contain NPAs" – With rainfall below average across most parts of the country, the impact on theagriculture sector is making bankers nervous. The total exposure of banks to the sector has shot up toRs.8,07,800 crore from Rs.7,20,400 crore in August last year. A report. – (HBL Oct 8, 2015 p 1)

CROP INSURANCE"Urgent need for crop insurance, says SBI: The killing fields deficient rains worrisome, distress

evident from rising farmers suicides, says an internal report" – The government must look into theissue of agriculture and crop insurance to ensure that the impact of deficient rainfall is minimised, State Bankof India has said in an internal research note. This year, the monsoons ended with a 14% deficiency. Areport. – (HT Oct 3, 2015 p 14)

NABARD

– RURAL INFRASTRUCTURE DEVELOPMENT FUND

"Nabard sanctions Rs.2,112 cr loan to Gujarat under RIDF" – As part of its rural infrastructure push,Nabard has sanctioned a loan of Rs.2,112.34 crore under the Rural Infrastructure Development Fund (RIDF)- XXI to the Government of Gujarat for two irrigation projects. A report. – (HBL Oct 6, 2015 p 19)

RURAL POVERTYTewari, Ruhi – "Why poverty in rural India is still a concern" – The recently-released India Rural

Development Report, which is endorsed by the government, says 7% of the rural population is 'very poor';villages in eastern Indian states are the worst affected. An article. – (IE Oct 7, 2015 p 7)

INDUSTRY

E-COMMERCE"E-commerce in India: Snap, flip and crackle" – Flipkart and Snapdeal vie to be India answer to Amazon

and Alibaba. An article. – (Eco 417(8958) Oct 3, 2015 p 74)

"Indian ecomm market to grow 36% in 2015-20" – Backed by huge discounts and the rising use ofsmartphones, the Indian e-commerce market is poised to grow 36% during the 2015-20, according to a newreport. – (ET Oct 3, 2015 p 4)

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Singh, Shelley and Bora, Anirban – "From cradle to grave: how ecommerce has changed your life" –No business in India in recent years has attracted as much hype around it as ecommerce. It is growing at ablink-and-you'll-miss-it pace. Pots of venture capital money are chasing boatloads of startups (despite doubtsover valuations). The numbers are staggering: 500-plus startups and Rs.70,000 crore in risky venture money.Companies have realised selling online is the smartest way to reach consumers rapidly. That's the businessside of things. What about us consumers? We have embraced shopping by smartphones with both hands.About 125 million shoppers spent $7 billion in 2014, buying things as diverse as flight tickets and razor bladesonline. If someone had said a few years ago that Indians would one day buy things like lingerie and furniturewithout visiting a store, they would have been mocked. Ecommerce, of course, is not just shopping. Far fromit. You can now fix appointments with doctors, trade in shares, bank, plan your retirement and holidays online.Ecommerce caters to every need one can think of, right from the time of birth to death. Yes, you read it right.Even death. Here is the big picture of how ecommerce has pervaded every aspect of your life. An advertisementfeature. – (ET Oct 8, 2015 p 14)

EXIM BANK"At 2.94%, our gross NPAs are below some of the best in industry" – Excerpts from an interview with

Yaduvendra Mathur, Chairman and Managing Director, Exim Bank. – (FE Oct 8, 2015 p 8)

HDFC"Housing finance major HDFC cuts rate by 25 bps" – After big banks cut their base rates, housing finance

major Housing Development Finance Corporation (HDFC) has cut its retail prime lending rate by 25 basispoints with the effective home loan rate at 9.65 per cent. The home loan rate for new customers would be9.65 per cent and for women customers it will be 5 basis points lower at 9.60 per cent, according to theHDFC statement. – (HBL Oct 6, 2015 p 10)

MANUFACTURING"Manufacturing PMI slips to 7-month low in September: New business from abroad expands at the

slowest pace in two years" – Indian manufacturing activity slipped to a seven-month low in September,according to the latest Purchasing Managers' Index (PMI). The Nikkei India Manufacturing PurchasingManagers Index (PMI), compiled by Markit, fell to 51.2 in September from 52.3 in August, mirroring aslower increase in new orders. A report. – (HBL Oct 2, 2015 p 1)

MUTUAL FUNDS"MF industry average AUM crosses Rs.13L cr for first time" – Amid concerns over rate hike in the US,

slowdown blues in China and domestic currency and stock market volatility, the Indian mutual fund industrycontinued to witness strong inflows of fund from domestic investors and the average quarterly AUM for theindustry crossed Rs.13 lakh crore for the first time. Data released by the Association of Mutual Fund of Indiashows that the average industry AUM rose by Rs.86,956 crore over the previous quarter ended June 2015and stood at Rs.13,21,388 crore for the quarter ended September 2015. This came on the back of continuinginflows into both equity and debt schemes. A report. – (IE Oct 6, 2015 p 14)

PHARMACEUTICALS"India to be among top 3 pharma mfg countries by 2020: Study" – India is expected to be among the top

three pharmaceutical manufacturing countries in the world with a turnover of $55 billion by 2020, accordingto a TechSci Research report released. A report. – (BS Oct 8, 2015 p 5)

PRIVATE EQUITY"A good year for PE: Exits, investments at record high: With exit-to-entry ratio of 35:40, experts say

this might be best year ever" – The current calendar year has seen private equity investments to the tuneof $11.8 billion, which is higher than $11.1 billion for the whole of calendar 2014. As per data sourced fromVenture Intelligence, PE exits during the current calendar have also touched a record high at $6.8 billion,which is nearly double of $3.9 billion recorded in 2014, and, in fact, the best so far for PE exits. A report.– (FE Oct 4, 2015 p 1)

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REAL ESTATE"RBI's rate cut brings good news" – Although rate cut may help sentiments, mortgage rate impacts the

sector more. A report. – (FE Oct 5, 2015 p 10)

SMALL SCALE INDUSTRY

MUDRA BANK"MUDRA Bank on a roll: The new agency can make a difference to small finance banks" – The Micro

Units Development and Refinance Agency Bank or MUDRA Bank, which was launched on April 8 this year,appears to have made an impressive start. An editorial. – (BS Oct 2, 2015 p 9)

MUDRA YOJANA"Banks step up lending to small businesses in organised sector: Collectively disburse Rs. 26,129

crore under Pradhan Mantri MUDRA Yojana" – At a time when India Inc's appetite for credit hasturned tepid, bankers seem to have put their shoulders to the wheel in giving loans to small manufacturingunits, including shopkeepers, street vendors, truck and taxi operators, and others under the Pradhan MantriMUDRA Yojana. Banks, including State Bank of India and its Associates (six banks), public sector banks(21), private sector banks (13), regional rural banks (56) and foreign banks (2), have stepped on the gas sincethe Yojana was launched on April 8. Collectively, these banks disbursed Rs.26,129 crore to over four lakhenterprises belonging to the Non-Corporate Small Business Sector (NCSBS) as on October 2, according toMUDRA (Micro Units Development & Refinance Agency) data. A report. – (HBL Oct 3, 2015 p 9)

"Making MUDRA work: Without credit insurance, just like directed lending" – An editorial.– (FE Oct 3, 2015 p 6)

INTERNATIONAL ECONOMICS"EM turmoil flashes global warning lights: Tracking index raises fears that fall in confidence will

infect advanced economies" – Emerging economies risk the world economy into a slump with lowergrowth and a rout in financial markets, according to the latest Brookings Institution-Financial Times trackingindex. A report. – (FT Oct 5, 2015 p 2)

"Global economy loses steam" – The world economy lost momentum in September, with China's factorysector shrinking again and euro zone manufacturing growth weakening slightly, both casualties of waningglobal demand. The latest business surveys across Asia and Europe paint a darkening picture and are likelyto prompt more calls for central banks around the world to loosen monetary policy even further. A report.– (FE Oct 2, 2015 p 12)

"IMF warns of worst global growth since financial crisis" – Slowdown in China and emerging economiesmasks rich nations' recovery. A report. – (FT Oct 7, 2015 p 2)

"IMF, central banks in the spotlight" – Weak U.S. jobs data further clouded the global economic picture,and pointed to a much-anticipated rate hike from the Federal Reserve being delayed further. Driven by fearsof a sharp slowdown, they will likely delay the structural adjustments in the coming two years and use the 'oldnormal' approach to support the economy, that is, rely on credit expansion and public investment, according toAmy Yuan Zhuang, Nordea economist. A report. – (H Oct 4, 2015 p 15)

"The long shadow of the financial crisis: Is the global economy in the midst of a lost decade?" –Conditions have become favourable for India compared with the situation prevalent a few years ago. Anarticle. – (Mint Oct 8, 2015 p 22)

"World economy on verge of tumbling into dollar recession" – A strong US dollar combined with slowingglobal growth is set to plunge the world into its first outright US dollar recession since 2009, according to ananalysis of International Monetary Fund data. A report. – (FT Oct 7, 2015 p 2)

– 19 –

Desai, Meghnad – "Can monetarists revive the global economy?: Central Banks, by fundingdevelopment activity, can do what govts are unable or unwilling to do using fiscal policy" – Thenear-term outlook for income growth is so depressed that markets may treat such activism on the part of aCentral Bank benignly. But that is a hope rather than an expectation. An article. – (FE Oct 5, 2015 p 6)

ASIA"A slowdown among Asian economies: Running out of puff" – The region is not in crisis, but slower

growth is hurting. An article. – (Eco 417(8958) Oct 3, 2015 p 36)

"World Bank trims Asia forecast but says no China hard landing" – China's GDP is expected to grow by6.9% this year, moderating to 6.7% next year and 6.5% in 2017. A report. – (Mint Oct 6, 2015 p 28)

Kynge, James and Wheatley, Jonathan – "Ill wind" – Deflation in Asia is shredding corporate profits,causing job losses and reducing consumer demand. The fear is that this drag on the global economy couldintensify and depress already feeble growth in the west. An article. – (FT Oct 5, 2015 p 7)

USA"US job growth stumbles, raising doubts on economy" – Smallest 2-month gain in jobs in over a year could

fuel fears that China-led global slump is sapping US's strength. A report. – (Mint Oct 3, 2015 p 12)

"US jobs data raise new rates doubts" – America's jobs juggernaut slowed sharply in September, missingrosy market expectations and casting further doubt over whether the Federal Reserve will raise interest ratesthis year. The report, which showed that the US economy created 142,000 jobs in September, fell short of the201,000 gains economists had forecast and was more than two-fifths below the trailing 12-month average,according to the Department of Labor. In a further blow, August jobs tally was revised from 173,000 to136,000 and wage growth flat lined. The unemployment rate was unchanged at 5.1 per cent. A report.– (FT Oct 3, 2015 p 1)

CAPITAL OUTFLOWS"Capital flight darkens economic prospects for emerging markets" – Emerging markets will suffer a net

outflow of capital this year for the first time since the 1980s as their economic fortunes darken and the USFederal Reserve prepares to lift interest rates. The projection will heighten concerns about the prospects forleading emerging economies including China and Brazil. A report. – (FT Oct 2, 2015 p 1)

ENVIRONMENT

– CLIMATE CHANGE

"India's credible offer on climate change: India has sent a strong signal by announcing efforts to curbclimate change" – Little can be achieved without a coherent set of policy and financial instruments. Anarticle. – (Mint Oct 7, 2015 p 30)

Mohan, Rohini – "The first big step" – India may have finally shown a willingness to be part of the globalclimate solution, but the road ahead is complex for a country that will still rely largely on polluting energysources to grow. An article. – (ET Oct 6, 2015 p 14)

Pulakkat, Hari – "Good start, but miles to go" – What do pledges from leading countries mean to globalclimate? A great deal. An article. – (ET Oct 6, 2015 p 14)

FINANCIAL STABILITY"Financial stability report: IMF warns emerging markets of risk from external shocks" – The

International Monetary Fund (IMF) warned that emerging market economies are more vulnerable to externalsector shocks compared with developed ones, as over-leveraged firms and rising bad debts in the bankingsystem put these economies at risk. A report. – (Mint Oct 8, 2015 pp 3, 4)

– 20 –

FUND MANAGEMENT"Global fund management" – A weekly report. – (FT Oct 5, 2015 Supl. pp 1-24)

INTERNATIONAL LABOUR ORGANISATION (ILO)"Segmenting labour market without social security isn't what we suggest" – Edited excerpts from an

interview with Sandra Polaski, Deputy Director General, International Labour Organization. – (BS Oct 8,2015 p 14)

INTERNATIONAL MONETARY FUND"Reforming the IMF" – It is time for major emerging market economies to push for much-delayed governance

reforms within multilateral financing agencies. Quick edit. – (Mint Oct 2, 2015 p 1)

INTERNATIONAL TRADE"Should India be worried about TPP?" – Overall, the pact's major impact on India would be through standards,

or non-tariff measures, according to experts. Confederation of Indian Industry (CII) says India joining Apecwould result in better integration into the region's economy. A report. – (Mint Oct 7, 2015 p 5)

POVERTY"A line that divides a country, economically" – Hunger games World Bank revised its poverty line and said

that global poor had come down 22% in past three years with India having the highest number of them. HTexplains the contentious metric. – (HT Oct 7, 2015 p 14)

"There is good news on global poverty: Rapid economic growth is still the most effective antidote tomass poverty" – The World Bank notes that Indian poverty may indeed be lower than what it has actuallyused in its latest report. An article. – (Mint Oct 6, 2015 p 30)

WORLD BANK"World Bank seeks capital boost as slowdown strains resources" – The World Bank president is pushing

global leaders to increase the institution's capital base, arguing that a slowdown in emerging markets andambitious UN development goals agreed last month mean the bank needs greater resources. A report. – (FTOct 5, 2015 p 1)

MANAGEMENT

CORPORATE SOCIAL RESPONSIBILITY"Social responsibility: Panel suggests steps to monitor implementation of CSR rules" – Taking note of

the concerns of companies, a high-level panel constituted to suggest measures for monitoring the implementationof Corporate Social Responsibility (CSR) Rules, 2014, has come up with 24 recommendations which havebeen uploaded on the ministry of corporate affairs (MCA) website. A report. – (Mint Oct 8, 2015 p 7)

LEADERSHIP"Celebrating small wins with team is crucial" – An interview with Pankaj Dubey, Managing Director, the

Indian arm of Polaris. – (HT Oct 8, 2015 p 13)

"The promise of leadership: clear the high bar of expectation" – Excerpted from Mastering Leadership:An Integrated Framework for Breakthrough Performance and Extraordinary Business Results, by Robert JAnderson and William A Adams (Wiley, 2015). – (Mint Oct 7, 2015 p 10)

– 21 –

MARKETINGUpadhyay, Abhinav – "Medium or small, this is how you grow" – Here are some marketing strategy

inputs for SMEs and start-ups to build brand and business. An article. – (HBL Oct 2, 2015 Supl. p 4)

MISCELLANEOUS"India to hold G20 Chair in 2018, Delhi may play host: Decision on this was taken earlier in Sept." –

India is set to be the G20 Chair in 2018, and New Delhi could host the prestigious annual G20 summit. Areport. – (H Oct 1, 2015 pp 1, 16)

"Nobel for DNA research in cancer war" – Three scientists from Sweden, the United States and Turkeywon the 2015 Nobel Prize for Chemistry for working out how cells repair damaged DNA, providing newammunition in the war on cancer. – (BS Oct 8, 2015 p 6)

"Three share Nobel for parasite-fighting drugs: Their discoveries helped develop medicines to fightmalaria, roundworm" – Three scientists from Japan, China and Ireland whose discoveries led to thedevelopment of potent new drugs against parasitic diseases such as malaria and elephantiasis won the NobelPrize for Medicine. A report. – (HBL Oct 6, 2015 p 1)

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