Volume XXX Number 36 June 8, 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 17

E. SMALL SCALE INDUSTRY 18

F. INTERNATIONAL ECONOMICS 18

G. LABOUR & PERSONNEL MANAGEMENT 19

H. MANAGEMENT 20

– 1 –

BANKERS' BRIEF Vol. XXX No. 36June 8, 2015

ECONOMY"April fiscal deficit at 23% of FY16 estimate" – The fiscal deficit for April came in at about Rs.1.27 lakh

crore, or 23 per cent of the full year budgeted estimate of Rs.5.56 lakh crore. This was higher than the 21.4per cent of the budgeted estimates in April last financial year. A report. – (BS May 30, 2015 p 4)

"Economic outlook: India poised for strong growth, GDP to rise 7.3% in 2015: OECD" – India'seconomic growth is projected to remain 'strong and stable' at 7.3 per cent in 2015 on the back of revival ininvestments even as more reforms are needed to reduce uncertainties over taxation norms, according to theParis-based think tank OECD. A report. – (Mint Jun 4, 2015 p 8)

"GDP data: is the worst over for the economy?" – GDP grows 7.3% in the fiscal year, pointing to aneconomic recovery, but agriculture remains a cause for concern. A report. – (Mint May 30, 2015 pp 1, 2)

"India beats China with 7.5% GDP growth in Q4: Manufacturing surges but farm sector lags; annualgrowth fastest in four years, at 7.3%" – Aided by a sharp rise in manufacturing, the Indian economygrew 7.5 per cent in the March quarter, putting it ahead of China as the world's fastest-growing largeeconomy. China had recorded 7 per cent economic growth in the January-March period. For the full year2014-15, India grew 7.3 per cent, higher than the 6.9 per cent recorded in 2013-14, using the new series. Thisis the country fastest annual growth since 2011. A report. – (HBL May 30, 2015 p 1)

"India on marathon path: Kotak" – Confident that India is on a 'marathon' growth path, eminent bankerUday Kotak has said that the markets should not look for any 'steroids' even as he warned against excessivedebt exposure of the corporates. Kotak also said that it has been an 'euphoric phase' since the NarendraModi-led NDA government came into power a year ago, while there is perception emerging now thatexpectations were ahead of reality. This perception stems from excessive exuberance, which needs to bemoderated. However, in reality, I am confident that growth will be steady, stable and upwards. A report.– (TI Jun 1, 2015 p 13)

"Macroeconomic snapshot" – A graphical report. – (Mint Jun 1, 2015 p 6)

"Moody's sees GDP growth slipping" – India's economic growth rate in the January-March quarter is likelyto slip to 7.2% from 7.5% in the previous three months, mainly on account of lower production and weakglobal demand, according to credit rating agency Moody's Corp. – (Mint May 29, 2015 p 10)

"We have put the train back on the rails. It is now accelerating" – Excerpts from an interview withJayant Sinha, Minister of State for Finance. – (HT May 29, 2015 p 13)

D'Souza, Errol – "India's macroeconomy: Post-Keynesian insights" – Market, Regulations and Finance:Global Meltdown and the Indian Economy edited by Ratan Khasnabis and Indrani Chakraborty. A bookreview. – (EPW 50(18) May 2, 2015 pp 22-24)

DISINVESTMENT"Govt faces 'daunting' task meeting disinvestment target of Rs.69,500 cr: Plummeting stock market,

deficient monsoon forecast cast a shadow over programme" – The Disinvestment Department is in atizzy; the poor monsoon forecast, combined with volatility in the stock market, is making the disinvestmenttarget for the current fiscal year look challenging, according to a senior government official. The FinanceMinistry has targeted raising Rs.69,500 crore through disinvestment in the current fiscal year. Of this, it aimsto raise Rs.41,000 crore through sale of a minority shareholding in Central Public Sector Enterprises (CPSEs)and Rs.28,500 crore through strategic sales. So far, there has been just one minority stake sale, with theGovernment selling 5 per cent in Rural Electrification Corporation and garnering Rs.1,610 crore. A report.– (HBL Jun 4, 2015 p 1)

– 2 –

EMPLOYMENT"Survey shows 118% rise in jobs created in July-December 2014: Effort paid off 2.75 lakh jobs

created in eight key sectors during these six months" – The Narendra Modi government's sharp focuson employment generation through Make in India and Skill India initiatives appears to have paid off, withIndia adding more than double the number of jobs between July and December 2014 compared to thecorresponding period of the previous year. According to a labour ministry survey, 2.75 lakh jobs were createdin eight key sectors during the six months, an increase of 118% over 1.26 lakh jobs created in the year-agoperiod. A report. – (ET Jun 4, 2015 p 11)

Kumar, Rajiv – "Barking up the wrong tree: Today's economic debate is misguided, it's job growthnot GDP growth that matters" – The ordinary Indian is left numbed by the numbers game. He is expectedlymore interested in news on job opportunities. And that unfortunately is not yet positive. Worse, real wagesare flat in cities and declining in rural India. An article. – (TI Jun 3, 2015 p 18)

Modi, Y K – "Creating an equitable employment policy" – Enlightened labour laws are imperative tocreate millions of new jobs and ensure that Make-in-India and other national programmes are a resoundingsuccess. The labour policy should be an 'employment policy' creating the maximum number of job opportunities.Make-in-India can only be meaningful if it creates jobs because a consumer is not concerned whether aproduct is manufactured in India or abroad. An article. – (FE May 30, 2015 p 9)

FOREIGN DIRECT INVESTMENT"FDI dips 40% in March to $2.11 bn" – Foreign direct investment (FDI) in India declined by 40 per cent

year-on-year to $2.11 billion in March 2015, the lowest in the last four months of 2014-15 fiscal. Previously,in November 2014 the FDI was the lowest at $1.53 billion. FDI in India was at $3.53 billion in March 2014.– (IE Jun 4, 2015 p 13)

FOREIGN EXCHANGE RATEVaish, Pankaj – "A straitjacket for the rupee: A weaker rupee increases imported inflation, widening

the inflation differential further and pushing REER higher" – Given how IT services, which are drivenby growth, form the most significant chunk of our exports, the exchange rate methodology should be augmentedto include growth as a variable. An article. – (FE Jun 3, 2015 p 6)

FOREIGN EXCHANGE RESERVES"Forex reserves fall by $2.32 bn to $351.56 bn" – The foreign exchange reserves fell by $2.32 billion in the

week ending May 15 to $351.56 billion after rising for the past five weeks. They had fallen by $2.6 billion forthe week ending April 10 at $340.41 billion. Foreign currency assets, fell by $2.28 billion to $326.84 billion.Gold reserves remained unchanged at $19.34 billion. Special Drawing Rights fell by $26.1 billion to $4.06billion, while India's reserve position with the International Monetary Fund (IMF) was down $8.5 million to$1.32 billion. – (BS May 30, 2015 p 3)

GST"Get on with GST: States concerns have been adequately addressed. Drop the 1 per cent levy" – An

editorial. – (HBL May 30, 2015 p 6)

Ramesh, Jairam – "Anything but a good, simple tax (GST)" – An article. – (Mint Jun 2, 2015 p 6)

INFLATION"RBI has to keep inflation under check for growth, says Rajan" – Amidst concern of deficient monsoon

and its likely impact on food prices, RBI Governor Raghuram Rajan said the central bank needs to keepinflation under check for sustainable economic growth. '... we absolutely have to bring inflation down forsustainable growth'. – (BS Jun 4, 2015 p 4)

– 3 –

PUBLIC DEBT MANAGEMENT"Happy to let go public debt management to government, says RBI Governor" – Reserve Bank Governor

Raghuram Rajan said there was no reason for RBI to manage public debt and he would be happy if the debtmanagement function goes to the government. A report. – (HBL May 29, 2015 p 6)

SERVICES SECTOR"Services PMI contracts to 13-month low in May: Demand dented by earthquake in April, sweltering

heat; rebound expected" – The HSBC Purchasing Managers' Index (PMI) for the services sector slippedbelow the crucial level of 50 to 49.6 in May, the first time it has done so in 13 months. In April, the index wasat 52.4. A score above 50 reflects expansion, while one below 50 indicates a contraction. A report. – (HBLJun 4, 2015 p 1)

BANKING

GENERAL"When will banks start lending again?" – Edited excerpts from panel discussion. Amitabha Guha, chairman,

South Indian Bank Ltd; Sharad Sharma, MD, State Bank of Mysore; Rakesh Bhatia, former chief executiveofficer, Catholic Syrian Bank; T K Srivastava, executive director, Syndicate Bank; and Chandra ShekharGhosh, chairman, Bandhan Financial Services Pvt. Ltd. participated. With rising levels of non-performingassets (NPAs) in their balance sheets, banks have been wary of lending. There are enough signs that theNPA problem will not go away immediately. So, when will Indian banks start lending again? How are banksgoing to tackle the capital problem? These issues were discussed at length at Mint second annual South Indiabanking conclave. – (Mint Jun 4, 2015 p 22)

AXIS BANK"Axis Bank allows booking of lockers via mobile app: Initiative will save customers many visits to

branches" – Now, you can use a mobile application to choose the nearest location where you can open abank locker. Axis Bank, has launched a new mobile application that will allow its customers to book lockers,saving them many visits to bank branches. A report. – (HBL Jun 4, 2015 p 6)

BANK OF INDIA"Bank of India to foray into investment banking, again" – Bank of India will re-enter the investment

banking space with the aim to tap more fee-based income. This is the second time the Mumbai-headquarteredbank is getting into investment banking after surrendering it in 2001 following weak response during that time.A report. – (ET Jun 2, 2015 p 10)

"Bank of India: audited financial results for the quarter/year ended 31st March, 2015" – An advertisementfeature. – (BS May 29, 2015 p 16)

"BoI posts net loss of Rs.56 cr in March quarter on high NPA provisions" – Weighed down by hugeprovisions for bad loans and a fall in net interest income (NII), Bank of India (BoI) posted a net loss after 56quarters of Rs.56.14 crore for the fourth quarter ended March 2015. The last time BoI had booked net losswas for the March quarter ended March 2001, at Rs.30.24 crore. Bank reported net profit of Rs.557.51crore in the corresponding quarter of FY14. The net profit for FY15 dipped 37.4 per cent to Rs.1,709 crorefrom Rs.2,729 crore for FY14. A report. – (BS May 29, 2015 p 6)

"Worst is over for bank, NPAs to fall now" – Excerpts from an interview with V R Iyer, Chairperson, Bankof India. While restraining itself from entering into infrastructure finance in a big way, Bank of India says it'sfocusing more on the retail side. Also she says the worst is over for the bank and the NPAs are set to reducefrom hereon. – (FE May 29, 2015 p 10)

Merchant, Krishna – "Bank of India pays price for fast loan growth during a downturn" – The bankreported a loss of Rs.56 crore in the March quarter, the first time since 2001 as it set aside more provisionsfor problem accounts. Bad loans continued to pile up from stressed sectors such as infrastructure, power,aviation and engineering. An article. – (Mint May 29, 2015 p 18)

– 4 –

CANARA BANK

– INLAND WATERWAYS AUTHORITY OF INDIA (IWAI)

"IWAI, Canara Bank developing model to attract investment in inland water vessels" – The InlandWaterways Authority of India (IWAI) is working with Canara Bank to develop models to incentiviseentrepreneurs to invest in inland water vessels. The proposal is at an advanced stage of consideration by thegovernment, according to Amitabh Verma, Chairman, IWAI. A report. – (HBL Jun 3, 2015 p 4)

CORPORATION BANK"Corporation Bank eyes CASA ratio of 25%: Will help maintain better operating efficiency" –

Corporation Bank is keen raising its current account, savings account (CASA) ratio to 25 per cent by thisfiscal-end , according to its Chairman and Managing Director S R Bansal. The CASA ratio, as a percentageof deposits, is now at 17 per cent. Our CASA ratio needs to go up further. The aim is to take it to 25 per centby March. A report. – (HBL Jun 4, 2015 p 6)

DENA BANK"Dena Bank: Balance Sheet as at 31st March, 2015 and Profit & Loss Account for the year ended

31st March 2015" – An advertisement feature. – (BS Jun 4, 2015 Sec. II pp 2-4)

DHANLAXMI BANK"Dhanlaxmi Bank Q4 net loss doubles y-o-y to Rs.266 cr" – Dhanlaxmi Bank's net loss in the fourth

quarter almost doubled year-on-year to Rs.266.61 crore on account of provisioning for non-performing assets.The net loss for FY15 stood at Rs.241.47 crore against net loss of Rs.251.82 crore in FY14. – (FE May 29,2015 p 10)

"Dhanlaxmi Bank: audited financial results for the quarter/year ended March 31, 2015" – Anadvertisement feature. – (FE May 29, 2015 p 42)

FEDERAL BANK"Federal Bank unveils payment app" – Federal Bank has launched - Scan N Pay- a mobile-based payment

app for making payments. The comfort and convenience of a mobile, the simplicity of a Quick Responsecode, the credibility of Immediate Payment Service facility from National Payments Corporation of India, thesecurity of Mobile PIN - all converge into this new application. – (HBL Jun 2, 2015 p 6)

HDFC BANK"HDFC Bank among top 100 valuable global brands in '15" – HDFC Bank is the only Indian entity to find

a place among the top 100 most valuable brands globally, along with Apple, Google, Microsoft, IBM andFacebook. – (ET Jun 1, 2015 p 15)

"HDFC Bank ATMs to go paperless" – HDFC Bank Ltd has decided to discontinue issuing slips after cashwithdrawals at automated teller machines (ATMs) and will alert the customer through text messages.– (Mint Jun 1, 2015 p 9)

IDBI BANK

– CORPORATE FINANCE

"IDBI Bank eases restrictions on corporate lending" – IDBI Bank has eased restrictions on corporatelending, following an improvement in the lender's performance on priority sector lending in 2014-15. About 65per cent of the bank's loans are to corporate entities. A cap on lending to the corporate sector was introducedbecause the bank had to rebalance its net bank credit to meet priority sector lending norms. Of a lender'soverall loans, 40 per cent must be towards priority segments such as agriculture. The bank's growing corporateloan book meant priority sector lending obligations also rose but often, its limited branch network prevented itfrom meeting targets. A report. – (BS Jun 2, 2015 p 6)

– 5 –

INDIAN BANKNathan, Narendra – "Indian Bank: bettering assets" – Stabilising asset quality and cheap valuation makes

the counter attractive. Indian Bank reported a healthy growth in its operating profit in the fourth quarter of2014-15. Strong fee income, higher treasury income and healthy recovery from accounts that had beenwritten off, helped the bank achieve this. Due to a strong growth in current deposits, its current and savingsaccount ratio also improved year on-year (y-o-y). Further, the bank's employee costs dipped 1.2% y-o-y.However, net profit fell 24% y-o-y due to the tax outgo of Rs.49 crore in the last quarter. A negative tax outgo(write back) of Rs.162 crore in the fourth quarter of last year, resulted in a net change in tax of Rs.211 crore,causing this fall in net profit. An article. – (ET Wealth Jun 1, 2015 p 28)

PUNJAB NATIONAL BANK"PNB offers waiver in retail loans" – PNB has launched a PNB Monsoon Bonanza Offer in which the Bank

is offering full waiver of upfront/processing fees and documentation charges. Under the offer, customers willbe given full waiver of up-front, processing fee and documentation charges of all housing and car loanssanctioned during 01.06.2015 to 31.12.2015. – (HBL May 29, 2015 p 4)

RESERVE BANK OF INDIA

– HUMAN RESOURCE MANAGEMENT

"The curious case of RBI's consultants: RBI's plan to hire pros raises questions as to what actuallythese consultants will do" – The idea to have a consultant instead of a full-fledged staffer might be astrategic shift after the staff union protest over such HR practices. A report. – (ET May 29, 2015 p 12)

SOUTH INDIAN BANK"South Indian Bank to hike FDI limit" – The board of directors of South Indian Bank has decided to

increase the FDI limit by 10 per cent subject to shareholder / FIPB approval. With the proposed increase, theforeign share holding can go up to 59 per cent as against the maximum permissible limit of7 4 per centprescribed under the FDI policy in the case of private sector banks. – (HBL Jun 4, 2015 p 6)

STATE BANK OF INDIA"Risks at micro level will remain ... these are part of pains of a growing economy" – Edited excerpts

from an interview with Arundhati Bhattacharya, Chairperson, State Bank of India. The last fiscal was adifficult one for many Indian banks including the State Bank of India with the slowdown and policy inertiaimpacting lenders and reflected in the huge pile of bad loans. But with a recovery in sight, albeit slow, therecould be a rebound later this fiscal with signs of progress. – (IE Jun 3, 2015 p 13)

"SBI's mCASH for money transfer" – State Bank of lndia customers can now transfer money to anyonewithout knowing their bank account details irrespective of whether the recipient bank is SBI or not. Thesender needs to have Internet Banking access either through browser or the State Bank Anywhere app.– (HBL Jun 2, 2015 p 6)

Ghosh, Shayan – "Old but restless: At 210, SBI looks for a makeover: The country's largest lendermust build on its biggest asset - its deposit franchise" – There will not be a single corporate loanconsortium where SBI would not be present, according to Arundhati Bhattacharya, Chairman, State Bank ofIndia. An article. – (FE Jun 1, 2015 p 11)

– BANK LENDING

"SBI loan approval now goes online" – State Bank of India launched Online Customer Acquisition Solution(OCAS), an online platform to apply for home loans, car loans, education loans and personal loans. Theapplication will help the customers gauge their eligibility and get a quote personalised to their requirement.The customer will instantly get an e-approval on filling the online form. A report. – (HBL May 30, 2015 p 8)

– 6 –

– FEDERAL BANK

"SBI-Federal bank launch co-branded credit cards" – Shyam Srinivasan, MD & CEO, Federal Bank andVijay Jasuja, CEO, SBI Card launched the Federal Bank SBI Co-Branded Credit Cards at a function held inNew Delhi. The credit cards will be chip-based cards providing a high level of security to the cardholders.– (ET Jun 1, 2015 p 4)

STATE BANK OF MYSORE"State Bank of Mysore opens 'SBM e Touch' Kiosk" – State Bank of Mysore (SBM) opened 'SBM e

Touch', a multi-facility electronic Kiosk providing services like pass book printing, automatic cheque dropbox, internet banking etc at Avenue Road in Bangalore adjacent to SBM' head office. – (ET Jun 1, 2015 p 4)

TAMILNAD MERCANTILE BANK"TMB declares Rs.700/share as second interim dividend" – The board of directors of Tamilnad Mercantile

Bank, at a meeting on Monday, decided to pay a second interim dividend of Rs.700 a share. This is in additionto the interim dividend of Rs.900 a share declared by the bank in January and paid to its shareholders.– (HBL Jun 4, 2015 p 6)

"TMB net profit shoots 26% at Rs.379 crore" – Tamilnad Mercantile Bank has reported 26.24% growthin net profit at Rs.279.40 crore for the fiscal ended March 31, as compared to rs.300.77 crore in the previousfiscal. Total business of the bank at the end of fiscal 2015 stood at Rs.44985.81 crore with a y-o-y growthrate of 13.06%. Gross NPAs as a percentage to total advances were at Rs.1.63% while net NPAs stood at0.67% of total advances. – (FE Jun 3, 2015 p 4)

BANCASSURANCE"Refurbished channel: tied model for banking channel in insurance may continue" – Recent amendments

to the draft guidelines on open architecture in insurance distribution will bring respite to bank-promotedinsurance companies. According to the fresh draft put out by the Insurance Regulatory and DevelopmentAuthority of India (Irdai) on 29 May, it is no longer mandatory for corporate agents to sell policies of at leasttwo insurance companies in the same line of business. A report. – (Mint Jun 3, 2015 p 20)

BANK CAPITAL

– BANK BONDS

Merwin, Radhika – "The risky rush for bank bonds" – Investors have been flocking to the additional tier 1bonds issued by banks. But have they adequately assessed the risks? An article. – (HBL Jun 2, 2015 p 8)

– PUBLIC SECTOR BANKS

"Capital infusion in govt banks: Consider stress management as criteria" – In 2014-15, the govt allocatedRs.6,990 crore towards capital infusion in nine PSBs. Indicating discomfort with the government's strategyof infusing capital in public sector banks (PSBs) based on efficiency parameters such as return on equity andreturn on assets, the Reserve Bank of India (RBI) said capital should be infused in banks that showed greaterresolve to clean their balance sheets. A report. – (BS Jun 3, 2015 p 6)

BANK LENDING"'Follow thy neighbour' policy is not good in banking: S S Mundra: Processing for lending should not

be outsourced, says RBI Deputy Governor" – Giving lessons in lending, RBI Deputy Governor S SMundra said that banks trying to emulate each other while extending loans could be one of the reasons for thestress in the banking system. First prepare the ground, understand the risk, understand the reward and thendo it, Mundra said at the launch of a book on Bank of India's history of 100 years. A report. – (HBL May 30,2015 p 11)

– 7 –

BANKING REGULATOR"No contradiction between rate cut and raising inflation view" – Edited excerpts from an interview with

Raghuram Rajan, Governor, Reserve Bank of India. – (Mint Jun 4, 2015 pp 1, 6)

"State of economy is probably weaker than we thought" – Edited excerpts from an interview with RaghuramRajan, Governor, Reserve Bank of India. We have moved a little from having a balanced inflation to havingsome upside risk in inflation forecast for the beginning of next year. – (ET Jun 4, 2015 p 6)

CHEQUESSarkar, Keya – "The problem with bearer cheques" – An article. – (BS May 30, 2015 p 10)

COOPERATIVE BANKING"Co-operative banks" – A commercial feature. – (BS May 29, 2015 Supl. pp 1-4)

"Cooperative Banks' play pivotal role in the economy" – The cooperative banks are best vehicles fortaking banking to doorsteps of common people, bringing in unbanked people in urban and rural areas to themainstream financial network. A commercial feature. – (BS May 29, 2015 Supl. p 4)

– BANK LENDING

"Cooperative Banks can offer you better solutions for loans" – Most commercial banks have an interestrate that is higher compared with the cooperative banks. A commercial feature. – (BS May 29, 2015Supl. p 2)

– BANKING TECHNOLOGY

"Cooperative Banks adopt technology to serve better" – Technology has undergone a drastic shift overthe last 15 years and this has benefited the smaller banks. A commercial feature. – (BS May 29, 2015Supl. p 2)

"Thoughtful security for banks" – The banking system and experience has evolved over the last severalyears and is now reached a certain standard. Time has come for banks to adopt latest security solutions thatare also customer friendly. A commercial feature – (BS May 29, 2015 Supl. p 2)

– CREDIT CARDS

"Credit card biz to open new avenues for Cooperative Banks" – The potential for increased usage ofcredit cards along with improved credit information data is pushing some banks to grow their credit cardportfolios more aggressively. A commercial feature. – (BS May 29, 2015 Supl. p 3)

– FINANCIAL INCLUSION

"Co-operating for inclusive growth" – The importance of co-operative banks stems from the fact that theyhave always stood for the advancement and inclusion of the common man into the banking system. Acommercial feature. – (BS May 29, 2015 Supl. pp 1, 4)

– GP PARSIK BANK

"GP Parsik Bank is now a multi-state scheduled bank" – A report. – (BS May 29, 2015 Supl. p 1)

– PMC BANK

"PMC Bank: committed to excellence" – A commercial feature. – (BS May 29, 2015 Supl. p 3)

– RUPEE COOPERATIVE BANK

"New board appointed for Rupee Bank" – The office of the Commissioner for Cooperation and Registrarof Cooperative Societies, Maharashtra, has appointed a new administrative board for Rupee CooperativeBank Ltd. In an order issued by Commissioner for Cooperation Chandrakant Dalvi, Dr Mukund Abhyankarwas appointed as chairman and Arvind Khaladkar and Sudhir Pandit were appointed as members of thebank. – (IE May 29, 2015 Supl. p 3)

– 8 –

– THANE BHARAT SAHAKARI BANK

"Thane Bharat Sahakari Bank: sound performance on all fronts" – Bank is always on the lookout forelevating the standard of its customers by providing them finance by way of loans, according to M Y Gokhale,Chairman, Thane Bharat Sahakari Bank. A commercial feature. – (BS May 29, 2015 Supl. p 2)

CORPORATE DEBT RESTRUCTURING"Unsuccessful CDR exits hit Rs.27,000 cr in FY15" – Enterprise service provider Tulip Telecom, EPC

player Indu Projects, Vibha Agrotech and engineering firm Apex Encon Projects are among companieswhose debt recast packages have failed. Between the four, banks had restructured a total of Rs.5,300 crore.A report. – (FE May 29, 2015 pp 1, 2)

CURRENCY NOTES

– CURRENCY PAPER

"Jaitley opens facility for domestic currency paper in Hoshangabad" – Finance Minister Arun Jaitleyinaugurated a new production line here to manufacture currency paper, saying it symbolised the beginning ofthe 'Make In India' initiative and would ensure high-denomination notes are printed on locally-made paper.– (FE May 31, 2015 p 11)

CUSTOMER SERVICE

– INTERNAL OMBUDSMAN

"Banks gearing up to appoint internal ombudsman: Bid to resolve customer grievances at the banklevel" – Soon, customers will be able to get their grievances related to banking services redressed at thebank level itself. This follows the RBI directive asking banks to appoint an internal ombudsman. If a customeris still dissatisfied with the solution provided by the internal ombudsman, he/she can take it up with the centralbank's banking ombudsman. A report. – (HBL Jun 2, 2015 p 6)

ELECTRONIC PAYMENTS"Cashless drive: RBI prefers e-payment for intra-city commute: To introduce a prepaid card with

balance limit of Rs.2,000" – In a bid to boost the cashless payment mechanism for intra-city commuting,the RBI has proposed to introduce prepaid payment instruments (PPIs) for mass transit systems. This willfacilitate migration of small value cash payments up to Rs.2,000 to electronic mode. A report. – (HBL May29, 2015 p 6)

EXECUTIVE APPOINTMENTS

– PUBLIC SECTOR BANKS

"PSB boards to get professional hands: Infy director Ravi Venkatesan, ex-finance and oil secys inrunning for top posts" – In a big step towards reforming struggling state-run banks, the government hasshortlisted Ravi Venkatesan, an independent director of Infosys, for the post of chairman of one of the state-run banks. Former finance secretary Sumit Bose will head another bank after the NDA government split thepost of CMD into chairman and managing director T N Manoharan, who is on the board of Tech Mahindra,and former petroleum secretary G C Chaturvedi names are also under consideration to head other banks.Approvals have been sought for the candidature of Ravi Venkatesan and Sumit Bose, according to a seniorofficial with the department of personnel & training (DoPT), adding that the other names shortlisted areManoharan and Chaturvedi. A report. – (ET May 29, 2015 p 1)

– RESERVE BANK OF INDIA

"Meena Hemchandra appointed RBI ED" – The Reserve Bank of India (RBI) appointed Meena Hemchandraas executive director. She will oversee the departments of supervision of banking, co-operative banking andnon-banking. – (FE Jun 2, 2015 p 13)

– 9 –

– STATE BANK OF INDIA

"Anshula Kant named CFO as part of SBI's management shuffle" – State Bank of India reshuffled a partof its top management and appointed Anshula Kant as its chief financial officer. Prior to this, she was deputymanaging director of operations. A report. – (FE Jun 4, 2015 p 8)

EXECUTIVE COMPENSATION"RBI norms on compensating directors" – The Reserve Bank of India (RBI) said non-executive directors,

apart from non-executive chairmen, on the boards of private sector banks may be compensated in the formof profit related commissions, but this compensation may not exceed Rs.10 lakh every year, for each director.In its guidelines for compensation of non-executive directors on the boards of private sector banks, thecentral bank said the compensation policy of non-executive directors, other than chairmen, must be adoptedby the board of the bank, in consultation with the remunerations committee. Apart from the profit linkedcommissions to the directors, banks may pay sitting fees to the non-executive directors and reimburse theirexpenses for participation in the board and other meetings. – (Mint Jun 2, 2015 p 12)

Kagade, Mandar and Verma, Aadhaar – "Contingent convertibles and bankers' pay: the missing linkin India's financial regulation" – The compensation practices at large financial institutions are often heldas one of the important factors which contributed to the 2007/2008 global financial crisis. Regulators aroundthe world, including India, have therefore moved to enact prescriptions aimed at increasing shareholderoversight of executive pay. Set against this background, the paper makes two novel proposals focusing on theIndian context. First, it nudges the regulators to prescribe creditor-centric compensation rules at banks. TheReserve Bank of India has hitherto focused on pay reforms that will promote incentive alignment betweenexecutives and shareholders. This paper argues that such reforms are likely to promote more rather than lessrisk-taking among bank executives. Second, it argues that the RBI ought to mandate banks to pay a substantialportion of the managerial compensation in contingent capital bonds. The design of these bonds can significantlymotivate executives to 'think like creditors' and thereby enable avoidance of taxpayer-funded bailouts. Anarticle. – (EPW 50(19) May 9, 2015 pp 55-61)

FINANCIAL INCLUSION"Financial inclusion will take time" – Edited excerpts from panel discussion. Sushil Muhnot, CMD, Bank of

Maharashtra; V S Radhakrishnan, MD, CEO, Janalakshmi Financial Services; Samit Ghosh, MD, UjjivanFinancial Services Pvt. Ltd.; Rahul Maharishi, Region Head, EMEA, South Asia, Global One; Alok Prasad,CEO, MFIN; Kalpana Tewari, Planning Board, Indian Postal Servies; and Rajni Mishra, Chief GeneralManager, Bengaluru Circle, SBI. How much have the policies of the National Democratic Alliance (NDA)government helped in bringing about financial inclusion? What are the challenges ahead for banks in ensuringbanking services to the nation 1.2-billion population? These issues were discussed at length at Mint's secondannual South India banking conclave. The discussion was moderated by Tamal Bandyopadhyay, advisor atBandhan Financial Services Pvt. Ltd and consulting editor of Mint. – (Mint Jun 3, 2015 p 22)

Kale, Sumita – "Achieving financial inclusion a key matrix" – The Modi government has to ensure thatfinancial inclusion reaches its ultimate goal - moving towards a less-cash economy. An article. – (FE May 29,2015 p 9)

Thorat, Usha – "Inclusion and opportunity: to be a catalyst for growth, financial inclusion must alsobe commercially viable" – Timely and adequate availability of credit is more important than its cost.Unless there is a change in public policy perceptions that loans to the poor have to be at very low rates,financial inclusion can never be sustainable. It is well known that the poor currently access informal marketsat rates ranging from 36 per cent (for collateralised loans) to 120 per cent for non-collateralised loans. In thiscontext, so long as commercial banks are transparent about their rates of interest, there should be publicacceptance of their charging commercial rates that cover their costs and leave some margin. Rates of 18 to22 per cent per annum should not be regarded as usurious. An article. – (IE May 29, 2015 p 10)

– 10 –

FOREIGN BANKING

– DEUTSCHE BANK

"Deutsche Bank plans to boost Asia AMC staff strength" – Deutsche Bank AG may boost the number ofits asset and wealth management staff in Asia by 5-10 per cent this year as part of the lender's revampedstrategy to boost growth. A report. – (HBL May 30, 2015 p 25)

– DOHA BANK

"Doha Bank to start operations in Kochi by August-September: Will cater to NRI population fromKerala" – Doha Bank, a leading bank in Qatar, is set to start banking operations in Kochi shortly. This willbe the bank's third branch after the recent opening of two branches in Mumbai. A report. – (HBL Jun 4, 2015 p 6)

– HSBC

"HSBC set to cut thousands of jobs, says report" – HSBC Holdings Plc could announce thousands of jobcuts at a strategy day next week, Sky News reported, part of chief executive Stuart Gulliver's overhaul ofEurope's biggest bank. The plan could also see Gulliver sell operations in Brazil and Turkey and take a knifeto HSBC's investment bank. An estimated 10,000 to 20,000 jobs will be axed, Sky News said, citing unidentifiedsources. A report. – (Mint Jun 3, 2015 p 13)

GLOBAL BANKINGRam Mohan, T T – "Global banking in retreat?" – An article. – (EPW 50(19) May 9, 2015 pp 10-11)

INDIA POSTManur, Anupam – "Maximising the post office" – Instead of hamstringing public sector banks with social

schemes, it is time to transfer many of these financial tasks to India Post. With 1.5 lakh rural branches, IndiaPost's reach far exceeds that of public sector banks. It also runs Post Office Savings accounts. Both areadvantages that can be easily and effectively harnessed. An article. – (H May 29, 2015 p 11)

– PAYMENT BANKS

"Postal dept readying plan to enter payment banking space" – Dept, which is hoping to get a nod soon, isstudying global models and preparing to hire top execs. A report. – (ET May 29, 2015 p 7)

INDUSTRIAL RELATIONS

– BANKING TECHNOLOGY

Prasad, Shashi Kant – "When technology trumps labour: trade union leadership and banks" – Thecapacity of trade unions to bargain or challenge technological change in the workplace has been a crucialaspect of the debate around machine-worker dialectics, which is a neglected area of research in India.Studying bank unions' struggles over technological choice and their implications on work routines, this noteseeks to revise the otherwise optimistic narrative about Indian trade unions and their relationship with technology.An article. – (EPW 50(20) May 16, 2015 pp 84-89)

– STATE BANK OF INDIA ASSOCIATES

"Nation-wide bank strike on June 24" – The All India Bank Employees Association (AIBEA) called for anation-wide strike on June 24 in support of various demands of the State Sector Bank Employees Association(SSBEA). SSBEA, under its umbrella, has various unions of associate banks of SBI. – (HBL Jun 1, 2015 p 20)

INTEREST RATE TRANSMISSIONMerwin, Radhika – "Banks may not lower rates to take on risk" – An article. – (HBL Jun 3, 2015 p 7)

Shah, Rashesh – "RBI cuts rates but banks don't" – An article. – (Mint Jun 1, 2015 p 31)

– 11 –

INTEREST RATES

– BANK LENDING

"Banks toe line, cut base rate" – State Bank of India, Allahabad Bank, Punjab & Sind Bank and Dena Banktrimmed their base rates after the Reserve Bank of India (RBI) cut the repo rate by 25 basis points. A cut inthe base rate implies loans will be cheaper for all borrowers. RBI governor Raghuram Rajan had observedearlier in the day that he expected a substantial transmission of the cut in the policy rate. While most lendershave been gradually reducing deposit rates over the past seven to eight months to be able to bring down thecost of funds, the transmission thus far has been relatively small. A report. – (FE Jun 3, 2015 pp 1, 2)

Merwin, Radhika – "Lending rates may trickle down, but gradually" – Poor Q4 performance, mutedcredit growth will act as deterrents for PSU banks. An article. – (HBL Jun 3, 2015 p 6)

– BANK OF MAHARASHTRA

"Bank of Maharashtra cuts base rate by 25 bps to 10%" – Bank of Maharashtra trimmed its base rate by25 basis points to 10%, following its larger peers. The move will bring down the cost of home, car and retailloans. – (FE May 30, 2015 p 10)

– DEPOSITS

"Punjab National Bank, Axis Bank cut deposit rates by up to 25 bps: Easy liquidity, tepid creditgrowth prompt move" – Your deposits will fetch less returns as banks have started cutting interest rates.This comes in the wake of the Reserve Bank of India cutting the policy rate from 7.50 per cent to 7.25 percent and easy liquidity in the banking system. Punjab National Bank (PNB) and Axis Bank announced retaildeposit rate cuts of up to 25 basis points. A report. – (HBL Jun 4, 2015 p 6)

– INDIAN BANK

"Indian Bank revises interest rates" – Indian Bank has revised interest rates in the foreign currency non-resident (banking) deposits, with effect from June 1. Accordingly, the new revised interest rate for depositsof one year and above but less than two years is fixed at 1.50%, from the existing 1.46%. – (FE May 31,2015 p 11)

– STATE BANK OF INDIA

"SBI cuts interest rate on women car loans" – State Bank of India has reduced interest rates on car loansby 25 basis points for its women home loan borrowers. The bank is offering the concession under the 'HerGhar Her Car' loyalty scheme. Under this, 'Her Ghar' borrowers can go in for a 'Her Car' loan at reducedrate of 10 per cent per annum, the bank said in a statement. – (IE Jun 2, 2015 p 15)

INVESTMENT

– CROSS-HOLDING OF LONG TERM BONDS

"Banks allowed to invest in long-term bonds of other banks, with rider" – The RBI, allowed banks toinvest in long term-bonds of other banks. This is subject to conditions whereby not more than 20 per cent ofthe primary issue size of a bond issue is allotted to investor banks. A report. – (HBL Jun 2, 2015 p 6)

MICROFINANCE"New CEO for microfinance body" – Ratna Vishwanathan will take charge as Chief Executive Officer of

Microfinance Institutions Network (MFIN) with effect from July 1. – (HBL Jun 4, 2015 p 6)

Roy, Subir – "Long way ahead of microfinance" – An article. – (BS Jun 3, 2015 p 9)

– 12 –

MONETARY POLICY"Corporates on policy: Rate cut not enough, says India Inc" – The Reserve Bank of India 0.25 per cent

rate cut is not enough to revive economic growth and much on the interest rate cycle will depend on externalfactors such as the monsoon and on global factors, say India Inc leaders. Most CEOs from the rate-sensitivereal estate sector said banks must pass on the benefits to end-consumers. This had not happened with earliercuts. A report. – (BS Jun 3, 2015 p 6)

"Data Drive: Rate cut on the cards?" – The easing of retail inflation, sputtering industrial output and mutedbank credit growth have once again rekindled hopes of a rate cut by the central bank in its June 2 monetarypolicy meeting. In April, consumer price index-based retail inflation fell to 4.9% on the back of declining foodprices belying worries that unseasonal rains will push up food prices. In the wholesale price index, deflationarypressure continued for the sixth month in a row with inflation dropping to a new low of (-)2.65% in April,mainly on account of a decline in prices of fuel and manufactured items even as food prices increased. Thecurrent trends in CPI is in line with RBI target - which is to bring CPI inflation down to 6% by Jan 2016 andto 4% thereafter. A graphical report. – (FE May 30, 2015 p 9)

"FinMin welcomes rate cut, but India Inc wants more: Govt hopeful of containing inflation, despitepredictions of a below-normal monsoon" – The Finance Ministry said the Reserve Bank's move to cutrepo rate by 25 basis points is consistent with the trend in the economy, but India Inc begged to differ, sayingit is not enough to pump up the economy. Welcoming the third rate cut since January, Chief EconomicAdviser Arvind Subramanian said the cut is consistent with the trend in the economy, including stronglydeclining inflation, contained current account deficit and strong fiscal discipline. The government and the RBIagree that the cut signifies that the economy needs policy support as economic growth is recovering while theexternal environment remains weak. A report. – (HBL Jun 3, 2015 p 7)

"Growth not my baby, RBI tells government" – The RBI and interest rates can only do so much. Aneditorial. – (ET Jun 3, 2015 p 14)

"Growth push: RBI cuts policy rate by 25 bps: Banks begin to reduce lending rates; markets fail tofind cheer" – RBI Governor Raghuram Rajan delivered the first policy rate cut of the current financial year,paring the interest rate at which banks borrow from the central bank (repo rate) to 7.25 per cent from 7.50per cent. Banks heeded the RBI call to pass on the rate cut with a few public sector banks cutting lendingrates by up to 30 basis points. Loans to housing, auto, small and medium enterprises and large corporates areexpected to get a tad cheaper. In its second bi-monthly policy statement, the RBI revised the inflation projectionupwards to 6 per cent by January 2016 from 5.8 per cent in April 2015. A report. – (HBL Jun 3, 2015 p 1)

"Limited growth support: RBI cuts rates, banks follow, will consumers spend?" – An editorial.– (FE Jun 3, 2015 p 6)

"Make a deep cut" – The economy needs a strong policy stimulus in the short term. There is a compellingcase for RBI to cut rates. An editorial. – (IE May 29, 2015 p 10)

"Monetary policy: the backdrop" – Reserve Bank of India (RBI) governor Raghuram Rajan is widelyexpected to reduce the repo rate, the benchmark rate at which the apex bank lends to banks, by 25 basispoints to 7.25%. Economists reckon that lower inflation and a stable currency give RBI enough room foranother rate cut, which would be its third in 2015. The central bank also needs to act quickly before interestrates in the US go up, they say. The key macroeconomic indicators Rajan will keep in mind when he makeshis decision. A graphical report. – (Mint Jun 1, 2015 p 11)

"The rates that matter" – The Reserve Bank of India reduced the repo rate, while keeping the othersconstant, in its latest review. HT explains how these instruments work and affect you. – (HT Jun 3, 2015 p 13)

"RBI Monetary Policy" – Reactions of leading bankers'. – (FE Jun 3, 2015 pp 8-9)

"Staying its hand" – Given the fluidity of global indicators, the RBI is wise to keep some of its powder dry. Aneditorial. – (HBL Jun 3, 2015 p 8)

– 13 –

"A time for caution for the central bank: greater credit availability will not lead to a rise in investmentgrowth" – There are two risks on the horizon that merit attention: the agricultural crisis in India and thepolicy stance of the US Fed. A report. – (Mint Jun 1, 2015 p 30)

Aziz, Jahangir – "No connect with official growth data" – That there is substantive space for monetaryeasing because inflation could decline well below the RBI's January 2016 target of 6% in the coming monthscompletely misses how an inflation-targeting central bank operates. An article. – (ET Jun 3, 2015 p 16)

Bandyopadhyay, Tamal – "Monetary policy: last of the RBI rate cuts for now?" – An article. – (MintJun 1, 2015 pp 1, 2)

Bandyopadhyay, Tamal – "When's the next rate cut? Govt knows" – An article. – (Mint Jun 3, 2015 p 7)

Bhupta, Malini – "Don't expect any more rate cuts in 2015" – RBI to keep an eye on monsoon, oil pricesand US Fed moves. An article. – (BS Jun 3, 2015 Sec. II p 1)

Bhusnurmath, Mythili – "Will Rajan cut rates? He should consider taking a leaf out of our northernneighbour's book will he, won't he...?" – The People's Bank of China is cutting interest rates 'by themost, since the global financial crisis as policymakers prioritise growth amid signs of a further economicslowdown'. An article. – (ET Jun 1, 2015 p 12)

Chakravarty, Manas – "The contradictions of RBI policy" – An article. – (Mint Jun 3, 2015 p 18)

Chakravarty, Manas – "Ten takeways for the Reserve Bank from the GDP data" – An article. – (MintJun 1, 2015 p 22)

Chinoy, Sajjid Z – "Dovish action but hawkish guidance?: We may get a rate cut today, but don't bankon a large easing cycle" – An article. – (FE Jun 2, 2015 p 11)

Chinoy, Sajjid Z – "A victim of expectations" – The central bank's primary mandate is to keep inflationcontained to creating the macroeconomic conditions that enable sustained growth. An article. – (BS Jun 3,2015 p 6)

Datta, Devangshu – "Uneven results of a rate cut" – A sudden rise in crude oil prices, or a deeper slowdownin China or a recession in America could hurt. An article. – (BS Jun 1, 2015 Sec. II p 1)

Ghosh, Soumya Kanti – "Inflation risk elevated?" – An article. – (Mint Jun 3, 2015 p 6)

Ghosh, Sugata – "Has Guv Rajan wasted his policy ammunition?" – Vacillating between inflation andgrowth: Governor Rajan is caught in a situation that's partly his own making: he can neither ignore NewDelhi's compulsions and urgency to push up growth nor can he dilute his stance as an inflation warrior. – (ETJun 3, 2015 p 11)

Govil, Rajan – "RBI policy hurts India's growth: Inflation-targeting has created an overvalued rupeewhich has hit Make-in-India and export competitiveness" – Food and fuel comprise 55% of the CPIin India, and both are difficult to forecast with certainty as both are very volatile for non-economic reasons(geo-politics, weather, etc.). In such a scenario RBI's inflation-targeting monetary policy is virtually likethrowing darts at unknown targets. An article. – (FE Jun 1, 2015 p 6)

Kumar, Shilpa – "Monsoon, crude key to more cuts" – An article. – (Mint Jun 3, 2015 p 6)

Narayan, Ananth – "Cry for easier policy gets louder" – An article. – (ET Jun 3, 2015 p 16)

Rangan, M C Govardhana – "How Rajan raised rates by cutting it" – When developed financial marketsbecome a reality and banks are solvent, the transmission issue would be put to rest. Focusing just at the actionand commentary on the repo rate might be missing the wood for the trees. An article. – (ET Jun 3, 2015 p 16)

Rangan, M C Govardhana – "Is there scope for Rajan to gift more than 25 bps cut?" – India has thehighest real rate among major EMs; it's time to normalise it to just above 100 bps. An article. – (ET Jun 1,2015 p 10)

Rao, Shubhada – "Time to sail through the 'known unknown' risks" – An article. – (FE Jun 3, 2015 p 8)

– 14 –

Sabnavis, Madan – "Expect no more cuts for now: Though RBI has predicated its rate action on themonsoon forecast, should it be this forward-looking?" – A question that will be still be asked is whetherthe 25-bps cut in rates RBI announced yesterday could have been a 50-bps one, given that, with inflation atjust a little above 5%, the real interest rate is still close to 200 bps - higher than what RBI has been speakingof. However, RBI appears to be very circumspect on future inflation even though it admits that the conventionalrelationships between monsoon, farm-output and inflation have not always held in the past. An article. – (FEJun 3, 2015 p 6)

Sanyal, Siddhartha – "There is room for more easing" – An article. – (Mint May 29, 2015 p 8)

Seshan, A – "Dealing with an uncertain climate" – India's monetary policy appears to have become agamble on the monsoon. Will it continue to haunt the economy? An article. – (HBL Jun 3, 2015 p 8)

Tarapore, S S – "Beware the rate cut brigade: Lowering interest rates at a time of sluggish savings,with the Fed likely to increase its rates, is not a good idea" – An article. – (HBL May 29, 2015 p 8)

Vageesh, NS – "It's time for Rajan to deliver more rate cuts" – Move will help boost sentiment, forcebanks to quicken transmission, spur spending and investment in economy. An article. – (HBL Jun 2, 2015 p 6)

Venkatesh, Latha – "Monetary policy and its non-monetary messages" – An article. – (Mint Jun 3, 2015p 29)

Verma, Sonal – "RBI's job is done, ball in govt's court" – An article. – (Mint Jun 3, 2015 p 6)

– BANKING REGULATOR

"RBI's job is to build confidence, not play cheerleader" – Excerpts from the media interaction withRaghuram Rajan, Governor, RBI. The RBI went for a front-loaded policy (repo) rate cut of 25 basis pointsfollowing low domestic capacity utilisation, mixed indications of economic recovery and subdued investmentsin credit growth. The central bank, upped its inflation projection for January 2016 to 6 per cent from 5.8 percent projected in April. RBI Governor Raghuram Rajan underscored that the central bank is not a cheerleaderfor markets and will take rate action only when the three risks to inflation, still clouding the picture, getclearer. Rajan said the RBI is waiting for more certainty on both monsoon outturn as well as effects ofgovernment responses in case of weak monsoon. If I cut rates, you say I want to please the government.And if I don't cut interest rates, you say I want to fight the government. – (HBL Jun 3, 2015 p 6)

NET STABLE FUNDING RATIO

– LIQUIDITY STANDARDS

"RBI issues draft norms on stable funding: To be implemented by banks from Jan 1, 2018, underBasel III framework" – The Reserve Bank of India issued draft guidelines on net stable funding ratio(NSFR) under the Basel III framework on liquidity standards for banks. The RBI has committed to thescheduled implementation of NSFR from January 1, 2018, for banks in India. Defined as the amount ofavailable stable funding relative to the amount of required stable funding, the net stable funding ratio for abank should be 100 per cent on an ongoing basis. A report. – (HBL May 29, 2015 p 6)

PLASTIC MONEY"FinMin, RBI set up panel to reduce cash transactions" – To reduce cash transactions in the economy

and boost the usage of cards and point of sales (PoS) terminals, the Union finance ministry and ReserveBank of India (RBI) have set up a committee to look at ways to encourage use of plastic money. Thecommittee has representatives from National Payments Corporation of India, State Bank of India and ICICIBank. It was formed last month. – (BS Jun 2, 2015 p 6)

"Jaitley pitches for greater use of plastic money: Says India needs to get rid of 'obsolete methodologies'& catch up with technology to boost industrialisation & create jobs" – Plastic currency refers to theuse of credit and debit cards, which helps to reduce reliance on paper currency notes. – (ET Jun 3, 2015 p 13)

– 15 –

PRIORITY SECTOR LENDINGPrabhu, K N V – "Advantage banks: new priority sector lending norms" – An analytical reading of the

new Priority Sector Lending (PSL) norms issued by RBI on 23rd April, 2015, widening the scope of PSL,reveals that most of the Indian banks are likely to reach the overall target without any concerted effort;though reaching some of the sub-targets may be difficult. An article. – (SE 54(2) May 15, 2015 pp 11-12)

PRIVATE SECTOR BANKS"Private banks to be reviewed by boards: RBI" – Private banks, too, will now have their performance

reviewed by their boards. Reserve Bank of India (RBI) had, a fortnight ago, prescribed seven categories -business strategy, financial reports and their integrity, risk, compliance, customer protection, financial inclusionand human resources - under which boards of private banks can review the performance of their organisations.– (BS May 29, 2015 p 6)

– BANDHAN

"With high credit growth, Bandhan to start bank with Rs.11k-crore credit base" – Bandhan FinancialServices has, ahead of its scheduled conversion into a full bank by September, stepped up its lending activity.In the past financial year, ending March 31, it recorded a 56 per cent growth in the gross loan portfolio. Thisis the highest the micro finance institution has seen in three years. A report. – (BS Jun 2, 2015 p 6)

PUBLIC SECTOR BANKS"PSB share in aggregate operating profit of banking industry drops" – Public sector lenders have not

lost ground to their private sector peers in terms of net profit alone. In fact, state-owned banks share inaggregate operating profit of the banking industry has dropped as well - by 199 basis points - in FY15.Capitaline data showed that public sector banks generated 66.32% of the total operating profit of 38 banks inFY15, down from 68.31% in the previous year. A report. – (FE May 30, 2015 p 10)

RISK MANAGEMENTStulz, Rene – "Taking risks in banking" – Citings from 'Governance, Risk Management, and Risk-Taking in

Banks'. – (ET Jun 3, 2015 p 14)

SMALL / PAYMENT BANKS"Licences for small finance, payment banks to be issued by August: 72 applications received for

small finance banks, 41 for payment banks" – The Reserve Bank of India will issue licences for smallfinance banks and payment banks by August-end. 'I hope to be able to announce a new set of bank licences,at least one set of bank licences by August-end...,' RBI Governor Raghuram Rajan said in a post-policyconference. – (HBL Jun 3, 2015 p 6)

WILFUL DEFAULTERS

– NPAs

"Bad debt: Wilful defaults on a rise, up 90% in '14 to Rs.44,465 crore: Figure close to 15% of totalnon-performing assets of Rs.3,03,380 cr; Rise highest ever in a calendar year" – From Vindhyavasinigroup to Winsome, Forever Precious Jewellery, Yash Birla Zenith Birla and even a government companycalled NAFED, the list of wilful defaulters is growing at a fast pace. Wilful defaults - or defaults by borrowerswho have the capacity to repay or those who have diverted funds - have jumped by nearly 90 per cent toRs.44,465 crore as of December 2014 from Rs.23,427 crore in December 2013, according to figures compiledby Credit Information Bureau (India) Ltd. A report. – (IE May 29, 2015 p 15)

RBI CIRCULARS"Auction of Government of India Dated Securities" – (RBI Circular RBI/2014-2015/619 Ref.No.IDMD/

2447/08.02.032/2014-15 dated 01.06.2015)

– 16 –

"Change in Bank Rate -SCBs/ LABS/ RRBs" – (RBI Circular RBI/2014-2015/624 DBR.No.Ret.BC. 99 /12.01.001/2014-15 dated 02.06.2015)

"Guidelines on Compensation of Non-executive Directors of Private Sector Banks" – (RBI CircularRBI/2014-2015/617 DBR.No.BC.97/29.67.001/2014-15 dated 01.06.2015)

"I.Liberalised Remittance Scheme (LRS) for resident individuals- increase in the limit fromUS$125,000 to US$250,000 and rationalisation of current account transactions" – (RBI CircularRBI/2014-2015/620 A.P. (DIR Series) Circular No. 106 dated 01.06.2015)

"Issue of Long Term Bonds by banks for Financing of Infrastructure and Affordable Housing - CrossHolding" – (RBI Circular RBI/2014-2015/618 DBR.BP.BC.No.98/08.12.014/2014-15 dated 01.06.2015)

"Liquidity Adjustment Facility - Repo and Reverse Repo Rates" – (RBI Circular RBI/2014-2015/622FMOD.MAOG. No.108 /01.01.001/2014-15 dated 02.06.2015)

"Marginal Standing Facility" – (RBI Circular RBI/2014-2015/623 FMOD.MAOG.No.109/01.18.001/2014-15 dated 02.06.2015)

"Revision in Bank Rate - UCBs/ StCBs/ CCBs" – (RBI Circular RBI/2014-2015/625 DCBR.BPD.(PCB/RCB).Cir.No.37/16.11.00/2014-15 dated 02.06.2015)

"Standing Liquidity Facilities for Banks and Primary Dealers" – (RBI Circular RBI/2014-2015/621REF.No.MPD.BC.378/07.01.279/2014-15 dated 02.06.2015)

"Submission of Long Form Audit Report (LFAR) by Concurrent Auditors" – (RBI Circular RBI/2014-2015/626 DBS.CO.ARS.BC.8/08.91.001/2014-2015 dated 04.06.2015)

AGRICULTURE & RURAL DEVELOPMENT

AGRICULTURAL FINANCE

– NPAs

"To curb farm sector NPAs, RBI asks big borrowers to hedge against price risks" – To ensure that thebanking sector minimises its bad loans or NPAs (non-performing assets) from agricultural lending, the ReserveBank of India has advised banks to encourage large agricultural borrowers, such as agricultural commodityprocessors, traders, millers, aggregators and the like to hedge their commodity price risks with the use ofderivatives. A report. – (HBL May 29, 2015 p 6)

– ORGANIC FARMING

Dongre, Dhakshayani M – "Impact of credit by banks to organic farming: an empirical study" –Organic farming was introduced by Sir Albert Howard (recognized as the father of organic forming) whowanted to evolve a more eco-friendly way of agriculture. It depends on various other farming methods, likecrop rotation and the use of compost organic farming thrives on the benefits obtained from recycling and useof natural products. Green manure, biological pest control methods and special cultivation techniques areemployed to maintain soil productivity, presently, organic farming is catering to a huge market world-wide. Anarticle. – (SE 54(2) May 15, 2015 pp 20-24)

AGRICULTURAL MARKETKolamkar, D S and Subramanian, Arvind – "A common Indian agricultural market?: the authors

explain the characteristics of agricultural markets in India and look at the possibilities of settingup a national market for commodities" – An article. – (BS May 29, 2015 p 12)

AGRICULTURE"Cropped out" – If any more proof was required that India's agriculture sector is in distress, the gross domestic

product data for 2014-15 provides it. Agriculture grew by just 0.2% in the fiscal year, compared with overalleconomic growth of 7.3%. Quick edit. – (Mint May 30, 2015 p 1)

– 17 –

Saini, Shweta and Gulati, Ashok – "Strike-three against farm sector: Poor rains forecast for 2015could flatline the sector growth, already hit by untimely rains and last year's drought" – The economymay be growing at 7.3%, but if the agri sector, which employs close to half of the Indian population, limps at0.2% growth in FY 15, or probably even negative in 2015, then the sustainability of India's growth story willbe seriously undermined. An article. – (FE Jun 4, 2015 p 6)

FOOD SECURITY

– WTO

"India to insist on permanent solution on food security" – Hardening its stand on the food security issue,India will insist that countries agree to a permanent solution to the dispute over public stockholding of foodgrainsby December as originally promised, even though developing nations have been granted an indefinite interimreprieve. A report. – (Mint Jun 3, 2015 pp 1, 2)

RURAL EMPLOYMENTSampath, G and Rukmini, S – "MGNREGA stuck in limbo..." – Lack of demand and irregular work have

affected the otherwise successful MGNREGA scheme, The Hindu finds out. Is it due to the delayed paymentsand funding cuts by the central government? An article. – (H May 31, 2015 p 12)

INDUSTRY

E-COMMERCEMall, Amitabh and Bajaj, Parul – "Indian E-commerce: Not yet the end of the beginning" – Much of

the recent growth has been funded by a high influx of capital to drive penetration. The business model,running on deep discounts and high customer acquisition costs, is unprofitable. An article. – (FE Jun 3, 2015 p 7)

HOUSING FINANCE

– OFFSET LOAN SCHEME

"How to be home and dry: Ever heard of a home loan that self-destructs? An offset loan scheme canreduce your interest outgo" – What is offset loan scheme? 1) Smart home loan or offset loan scheme isa facility offered by banks that allows customers to offset the interest earned on the money deposited in thebank in a specific loan account against interest on home loan; 2) Under this scheme, the borrower has tomaintain a loan account, which is like a current account with an overdraft limit equal to the amount of thesanctioned loan; 3) The borrower can deposit surplus money in this account, withdraw at any time and evenmanage EMIs with this amount. Banks offer a passbook and a debit card for this account; 4) Usually, theinterest on offset loans is 0.1-0.5% higher than on plain-vanilla loans; 5) The borrower can use this facilityonly if he maintains deposits over and above the bank's specified threshold limit; 6) The interest on the loanis then calculated after subtracting any additional savings maintained in the account every month (over theEMI) from the outstanding loan. An article. – (FE May 29, 2015 p 13)

INFRASTRUCTURE DEVELOPMENT

– PPP

"Getting PPP right: Hopefully, Kelkar panel will get the formula right" – An editorial. – (FE Jun 1, 2015 p 6)

INFRASTRUCTURE SECTOR"Infra sector output shrinks 0.4% in April" – The output of core sector industries shrank by 0.4% in April

- an 18-month low - due to negative growth in production of crude oil, cement, electricity generation, fertiliser,natural gas and refinery items, giving rise to fresh worries over industrial recovery despite recent ministrydata showing robust growth in manufacturing in Q4 of FY15. For full 2014-15 fiscal, core sector outputslowed to 3.6% from 4.2% in the previous fiscal. – (FE Jun 2, 2015 p 4)

– 18 –

INSURANCE

– HEALTH INSURANCE

"Coming, a savings account with your health insurance policy: IRDA close to decision on plan thatwill save money for health expenses" – The insurance regulator is considering allowing a savings-cum-health insurance product. A panel headed by M Ramaprasad, Member (Non-Life), Insurance Regulatoryand Development Authority of India, in a recent report to IRDAI, said: 'Such a product could be a healthinsurance plan that provides an account to the policy-holder where she can put money to save for futuremedical expenses...'. The move is expected to drive growth in health insurance, which is still seen as the lastpriority for the people, especially in rural and semi-urban areas. A report. – (HBL May 29, 2015 p 1)

MANUFACTURING"Manufacturing PMI at 4-month high in May: Sharpest rise seen in consumer goods output; prospects

of RBI rate cut brighter: economists" – India's factory production index surged to a four-month high inMay, with acceleration seen in both output as well as new-order growth, according to a survey based onresponses from purchasing managers. The HSBC Purchasing Managers' Index (PMI) for manufacturingstood at 52.6 in May, up from 51.3 in April. A report. – (HBL Jun 2, 2015 p 1)

SMALL SCALE INDUSTRY

MSMEs"Framework notified for MSMEs rehabilitation" – A salient feature of the framework is identification of

incipient stress. The Centre notified a framework for revival and rehabilitation of Micro, Small and MediumEnterprises (MSMEs), which mandates banks to form a panel to chalk out a corrective action plan to beadopted for units having stressed accounts. A report. – (H May 30, 2015 p 13)

SIDBI"Small Industries Development Bank of India (SIDBI): audited financial results for the Half year/

year ended March 31, 2015" – An advertisement feature. – (FE May 29, 2015 p 34)

SMEs

– FINANCE

Raju, B Yerram – "Excluded from credit" – Small units cannot access formal finance. Priority-sectorlending is targeted at financially excluded populations and medium enterprises do not qualify as one. Theirinclusion will only make small enterprises even more excluded. An article. – (HBL Jun 1, 2015 p 15)

INTERNATIONAL ECONOMICS"Germany outpaces US in economic 'wellbeing' index" – Germans are benefiting more from their country

economic rebound than Americans are from the US recovery thanks to greater investment in education andinfrastructure. In China rapid economic growth is being hindered by pollution and other factors and translatingonly slowly into broader economic 'wellbeing' while in India, Asia new growth champion, progress has beeneven slower. According to a report by Boston Consulting Group. – (FT May 28, 2015 p 6)

"OECD cuts global growth outlook as investment lags, Greece looms" – The Organization for EconomicCooperation and Development cut its global growth forecast, saying investment is lagging and risks includinga possible Greek default are hurting confidence. The world economy will expand 3.1 percent this year, downfrom the 3.7 percent predicted last October, the Paris-based organization said in a semi-annual report. Areport. – (BS Jun 4, 2015 p 6)

– 19 –

CHINAJun, Zhang – "China's new world order" – China is attempting to recast the world order, specifically the

monetary and trading systems, on its own terms. An article. – (Mint Jun 4, 2015 p 31)

Stephens, Philip – "Now China starts to make the rules" – Great powers like to start their own clubs, andtry to turn economic weight into geopolitical clout. An article. – (FT May 29, 2015 p 7)

EURO-ZONE"ECB warns of shadow bank threat to bloc's stability" – The rapid growth of the shadow banking sector

poses a risk to financial stability in the eurozone, the European Central Bank has warned. A report. – (FTMay 29, 2015 p 4)

EUROPE"Daghi's impatience at the slow pace of reform" – Structural improvements are for national politicians to

implement. An editorial. – (FT May 29, 2015 p 6)

ASIAN INFRASTRUCTURE INVESTMENT BANKBery, Suman – "Why AIIB could work for India" – The Asian investment bank could transform development

finance and enable Sino-Indian cooperation. An article. – (BS May 30, 2015 p 11)

Kolke, Yuriko – "AIIB and Chinese strategy" – A serious concern regarding AIIB is whether it will turn outto be a bank of China, by China, and for China. An article. – (Mint May 29, 2015 p 31)

BRICS BANKRoy, Rathin – "How BRICS bank can win" – An article. – (BS Jun 2, 2015 p 9)

FUND MANAGEMENT"Global fund management" – A weekly review. – (FT Jun 1, 2015 Supl. pp 1-28)

INTERNATIONAL RESERVE CURRENCYNordvig, Jens – "Euro's status as second reserve currency gives it a temporary floor" – Beijing is still

years away from paving the way for the renminbi to compete. An article. – (FT May 28, 2015 p 24)

LABOUR & PERSONNEL MANAGEMENT

LABOUR MARKETSChakraborty, Achin – "Reforming labour markets in state: revisiting the futility thesis" – Presenting a

critical review of the issues in labour market reforms in India, this article places them against the backdrop oftrends in labour force participation and formal/informal employment in the organised/unorganised sectors.Critically assessing the theoretical literature on labour market flexibility in the advanced economies, discussionsin the Government of India's Economic Survey and the evidence in India, it asks if the reforms aimed atmaking the labour market more flexible will succeed in raising the economic growth rate and generating moreemployment, as advocates of labour market reform would have us believe. An article. – (EPW 50(20) May16, 2015 pp 52-57)

SKILL DEVELOPMENT"Government misses 2014-15 skill development target: 21 departments and ministries trained 7.6

million people as against a target of 10.5 million people" – Despite sharpening its focus on it with adedicated ministry, the government has failed to achieve its targets for Skill India, pointing to the enormity ofthe task in a country that is seeking to rapidly scale up its competitiveness through its human resources. Areport. – (Mint Jun 4, 2015 p 7)

– 20 –

MANAGEMENT

CORPORATE GOVERNANCE

– INVESTMENTS

Saravanan, P and Shaw, Tara Shankar – "The company you keep" – Corporate governance isn't just aboutcomplying with guidelines - it has a direct bearing on your investments. An article. – (FE Jun 2, 2015 p 15)

FINANCIAL REPORTING"IFRS puts shareholders at the front" – Edited excerpts from an interview with Kenneth Marshall, Americas

FAAS Leader & Member of the Global FAAS Leadership Team. – (BS Jun 1, 2015 Sec II p 4)

LEADERSHIP"Listening effectively is biggest challenge" – Edited excerpts from an interview with Sunil Mathur, Managing

Director, Siemens India. – (HT Jun 4, 2015 p 13)

Shetty, Rohini G – "Taxonomy of leadership theories & models introspection" – All leadership styles,theories and models tackle the question of what it takes to be an effective leader. Is it the personality traitsthat make individuals better suited to leadership roles or does the situation or context make it more likely thatpeople will take charge and lead? The question remains unanswered till date. Whenever a successful CEOof an organization is seen, one begins to wonder why and how the person excels as a leader. Interest inleadership throughout history has been there, but only in recent times have formal theories on leadershipemerged to give a better understanding and perspective to the topic. An article. – (SE 54(2) May 15, 2015 pp41-47)

MANAGEMENT EDUCATION"IIM-A opens new position for non-PhDs, govt officials: post will be called professor of management

practice" – In a first for the country's premier business schools, IIM Ahmedabad (IIM-A) is planning to tapsenior corporate executives and government officials for a new faculty position called 'Professor ofManagement Practice', inviting non-PhDs to come and teach at the institute. The new position is differentfrom visiting faculty members and is targeted at those considering a serious, full-time career in academics. Areport. – (ET May 30, 2015 p 8)

"Rise up in career with management education" – The job scope for MBA graduates is unparalleled. Theyget attractive pay packages and placements being offered at college-level itself. It also has wide variety ofoptions and opportunities. MBA provides a ladder to reach top slots in corporate sectors. A commercialfeature. – (BS Jun 3, 2015 p 10)

WOMEN DIRECTORS"Bringing women on board" – Corporate India is wrong to drag its feet on appointment of women directors.

An article. – (EPW 50(19) May 9, 2015 p 8)

BANKERS' BRIEFAn Online Weekly News and Views Digest

Subscription / Renewal Form

Annual Subscription Rates

Individual : Rs. 375.00 Institutional Rs : 500.00

I wish to subscribe/renew for Bankers' Brief (An Online Service) as per your terms andconditions for the following period: to

My Mailing Address:

Name :

Address :

City : State : Pin:

Mobile : Email :

Kindly remit/send subscription amount by ECS/Demand Draft/at par cheque. Pleasefind enclosed/remitted DD/at par Cheque/UTR No.dated drawn onin favour of "National Institute of Bank Management", and payable at Pune.

Mode of Subscribing/Renewing

The subscription amount may preferably be transferred by RTGS/NEFT/ECS to ourCurrent A/c No.20002400021 with Bank of Maharashtra, NIBM Branch, Pune(IFSC Code MAHB0001124)

For all electronic remittances, kindly send a confirmatory e-mail at: john@nibmindia.org giving transaction UTR No. and other details of the payments.

In case the amount is remitted by Demand Draft or at par cheque, it should be drawnin favour of "National Institute of Bank Management", and payable at Pune.

Please remember to mention your old subscription number for renewal.

Address all your Subscription related communication to:

Publications OfficerNational Institute of Bank Management

NIBM PO, Kondhwe Khurd, Pune 411 048 (India)Telephone: 0091-20-26716000 (EPABX) Direct: 26716525

Fax: 0091-20-26834478Email: john@nibmindia.org Website: www.nibmindia.org

NIBM Journals and Publications

PrajnanJournal of Social and Management Sciences

Annual Subscription Rate : One year Rs.300.00 Two years Rs. 550.00 Three years Rs. 825.00

VinimayaPresents Conceptual and Practical Viewpoints of both

Bankers and Management Educationist

Annual Subscription Rate : One year Rs.225.00 Two years Rs.375.00 Three years Rs. 550.00

Areas of Publications Agricultural & Rural Development International Finance

Banking Management, Planning and Control

Computer & Systems Monetary Economics

Foreign Trade Operational Banking

Human Resource Management/HRD

(For details visit NIBM Website : http://www.nibmindia.org)

Enquiries may be mailed to :Publications Officer

National Institute of Bank ManagementNIBM Post Office, Kondhwe Khurd, Pune 411 048

Telephone : 0091-20-26716000 (EPABX) Direct: 26716525 Fax : 0091-20-26834478E-mail : john@nibmindia.org

Website : http://www.nibmindia.org

Edited by Library Team and Published Online by National Institute of Bank Management, NIBM Post Office, Kondhwe Khurd, Pune 411 048 INDIA

(Registered with the Registrar of Newspaper for India under Registration No. G 165.238/1984 of 20-6-84)