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☕ 17.06.2023 : Today's Banking / Financial News at a Glance 

🍒     SBI presents dividend cheque of Rs 5,740 crore to Finance Minister Nirmala Sitharaman : State Bank of India (SBI) on Friday paid a dividend of Rs 5,740 crore for the financial year 2022-23 to Finance Minister Nirmala Sitharaman. The dividend cheque was presented by SBI chairman Dinesh Kumar Khara in the presence of Financial Services Secretary Vivek Joshi. "Smt @nsitharaman receives a dividend cheque of Rs 5,740 crore for FY 2022-23, which is the highest-ever dividend given by State Bank of India to Govt of India for a financial year, from Shri Dinesh Kumar Khara, Chairman -@TheOfficialSBI. Secretary - @DFS_India Shri Vivek Joshi is also present on the occasion," the finance minister's office said in a tweet. SBI had declared a dividend of Rs 11.30 per equity share (1,130 per cent) for the financial year ended March 31, 2023. - economic times

🍒    RBI approves P N Vasudevan's re-appointment as MD & CEO of Equitas Small Finance Bank : The Reserve Bank of India has given its approval for the re-appointment of P N Vasudevan as MD & CEO of Equitas Small Finance Bank. Vasudevan has been re-apponted for a period of three years w.e.f. July 23, 2023, the bank said in a BSE filing. Vasudevan's current term as MD & CEO expires on July 22, 2023. He had announced his intention to step down in May this year to devote his time towards social welfare through his public charitable trust. - economic times

🍒    Axis Bank appoints former RBI DG Vishwanathan as part-time Non-Exec Chairman : Private sector lender Axis Bank on June 16 appointed former Reserve Bank of India (RBI) Deputy Governor NS Vishwanathan as a part-time Non-Executive Chairman. Vishwanathan has been appointed for a period of three years, Axis Bank said in a release. "Subject to approval of the shareholders of the bank and Reserve Bank of India, NS Vishwanathan's appointment will be effective from October 27, 2023 or the date of approval of his appointment by Reserve Bank of India for a period of three years," the bank said in the release. - moneycontrol.

🍒    Rs 2,000 note withdrawal: Kotak Mahindra Bank garners deposits of Rs 5,400 crore : Kotak Mahindra Bank has garnered about Rs 5,400 crore of fresh deposits courtesy of the RBI's move to withdraw the Rs 2,000 denomination notes, a top official said on Thursday. The majority of the customers depositing the money are businesses, and the money is coming into current accounts held by them, the private sector lender's president for retail liabilities and branch banking Virat Diwanji told reporters here. - economic times

🍒    South Indian Bank has received Rs 888 crore worth of Rs 2,000 notes : Kerala-based South Indian Bank received Rs 888 crore worth of Rs 2,000 notes until June 13, with the bulk of the withdrawn currency being deposited in their accounts by citizens. MD and CEO Murali Ramakrishnan told Moneycontrol on June 16,"Rs 756 crore worth of Rs 2,000 notes have been deposited in the accounts, Rs 132 crore have been exchanged till June 13, 2023."The Reserve Bank of India (RBI) on May 19 announced the withdrawal of Rs 2,000 bills as part of its clean note policy and gave time till September 30 for the exchange or deposit of the highest value currency note. It also advised banks to stop issuing the Rs 2,000 notes with immediate effect. RBI governor Shaktikanta Das on June 8 said the central bank received Rs 1.8 lakh crore worth of Rs 2,000 notes. - moeneycontrol.

🍒    Kotak Mahindra Bank’s board approves issuance of NCDs aggregating up to ₹7,000 cr in FY24 : The Board of Directors of Kotak Mahindra Bank (KMB), on Friday, approved the issuance of Unsecured, Redeemable, Non-Convertible Debentures (NCDs) up to ₹7,000 crore during FY24. The NCD issuance, which will be under the prevailing Members’ approval, will be in one or more tranches/series on a private placement basis, KMB said in a regulatory filing. - Business Line

🍒   Bank deposits surge Rs 3.26 lakh crore as people rush to surrender Rs 2,000 notes : The banking system was flushed with deposits in the very first fortnight after the Reserve Bank announced the withdrawal of Rs 2000 notes. Aggregate deposits mobilised by the commercial banks in the country rose Rs 3.26 lakh crore to Rs to Rs 187 lakh crore during the fortnight ended June 02 according to the latest data reported in the weekly statistical supplement released by the Reserve Bank of India. While term deposits increased by Rs 2.65 lakh crore, demand deposits increased by Rs 760968 crore. The annual deposit growth works out to 11.8 percent compared to 9.3 percent in the same period a year ago. Though deposit growth this year is higher, it still lags the credit growth. Bank lending increased 15.4 percent compared to 13.1 percent in the same period a year ago. - economic times

🍒    Future LoCs to Africa could cover defence, says EXIM Bank MD :  India's future Lines of Credit (LoCs) to Africa could focus on defence exports to meet the requirements of the continent, MD of EXIM Bank of India Harsha Bangari told ET. As India explores defence exports to Africa based on the growing interests for Indian defence equipment in the continent, future LoCs could cover defence, according to Bangari. Other potential areas for extending LoCs to Africa in future could include technology parks, renewables, health care and affordable housing, Bangari hinted. - economic times

🍒    RBI imposes Rs 20 lakh penalty on Manappuram Finance for rule violations : The Reserve Bank of India (RBI) on June 16 said that it has imposed a monetary penalty of Rs 20 lakh on Manappuram Finance for rule violations. The penalty was imposed as the company failed to classify certain gold loan accounts with overdue of more than 90 days as Non-Performing Assets (NPAs), RBI said in a release. Further, the company did not ensure maintenance of the mandated Loan-to-Value (LTV) ratio in certain gold loan accounts during FY 2020-21, the RBI said. - moneycontrol.

🍒    SBI, BoB, Canara Bank top execs’ salary hikes halved in FY23 : The annual remuneration of the top executives of the State Bank of India (SBI), Bank of Baroda (BoB), and Canara Bank rose 6-7 percent in the fiscal year 2022-23, according to data in the annual reports of these lenders. The rate of salary growth was almost half that of the previous financial year. The total remuneration of SBI Chairman Dinesh Khara rose 7.45 percent in FY22-23, to Rs 36.99 lakh. In the previous fiscal, Khara's remuneration had increased by 13.45 percent. The report of Khara’s salary triggered a storm on social media. While some argued that his compensation was too low considering the size of the bank he heads, others said the SBI Chairman’s job comes with other perks. - moneycontrol.

🍒    PhonePe launches its own payment solution for MSMEs  : PhonePe rolled out its own in-app payment gateway to help MSMEs (Mico, Small and Medium Enterprises) in India, as per reports. PhonePe, backed by Walmart, has joined the list of Paytm, Razorpay, PayU, Pine Labs, and others, for setting up a payment gateway with no extra charges like setup fees or maintenance costs for small and medium business owners. Most of the payment gateways charge 2 per cent on transaction fee. PhonePe’s payment gateway aims to help merchants save up to ₹8 lakh, who have monthly sales of ₹1 lakh. With the latest launch, merchants across Android, mobile web, iOS and desktop can easily accept transactions. - Business Line

🍒    Paytm brings UPI SDK in India for faster payments  : Paytm has introduced a UPI software development kit (SDK) for customers to make payments to online merchants without any failure of the system, suggests reports. UPI SDK assures fail-proof transactions. Paytm UPI SDK will let users pay directly from bank accounts through UPI PIN without having to jump between merchant and payment app. Along with Paytm UPI Lite, the company is enhancing two-sided payments, for both merchants and customers. - Business Line.

🍒    India's forex kitty declines by $1.32 bn to $593.75 bn, shows RBI data : India's forex reserves dropped by $1.318 billion to $593.749 billion for the week ended June 9, the Reserve Bank of India said on Friday. The overall reserves had jumped by $5.93 billion to $595.067 billion for the previous reporting week. For the week ended June 9, the foreign currency assets, a major component of the reserves, decreased by $1.128 billion to $525.073 billion, according to the Weekly Statistical Supplement released by the RBI on Friday. - Business Standard

🍒    Banks ask RBI to frame policy for silver loans similar to gold metal loans : Several banks have reached out to the Reserve Bank of India (RBI) to seek a framework for silver metal loans similar to the existing gold metal loans, The Economic Times (ET) reported on Friday. An official quoted in the report said that jewellery manufacturers have been asking banks to extend loans for the procurement of silver, silver articles and for jewellery manufacturing. Under the current Gold Monetisation Scheme, 2015, banks can extend gold loans to jewellery exporters or domestic manufacturers. The loan, equivalent to the value of gold borrowed, needs to be repaid in rupees. But the borrowers also have the option to repay a part of the loan in physical gold in lots of one kilogram or more. - Business Standard

🍒    Major banks cut China 2023 GDP forecasts as recovery falters :  Four major Western banks have cut their 2023 gross domestic product (GDP) growth forecasts for China after May data showed a post-COVID recovery was faltering in the world's second-largest economy.  UBS, Standard Chartered, Bank of America (BoA) and JPMorgan now expect China's GDP growth to be between 5.2% and 5.7% this year, down from an earlier range of 5.7% to 6.3%. - economic times

🍒    Reliance on third-party technology providers requires robust risk management practices by banks: RBI DG Jain : Banks must carefully manage the adoption of new technologies and ensure adequate controls and safeguards to address potential vulnerabilities, according to Reserve Bank of India Deputy Governor MK Jain. Additionally, the reliance on third-party technology providers requires robust due diligence and risk management practices to mitigate the risks associated with outsourcing.“Banking is undergoing a significant technology revolution, driven by the emergence of fintech companies. This is pushing traditional banks to embrace digital transformation and become agile and innovative. “While technology brings numerous benefits, such as increased efficiency and improved customer experiences, it also presents varied risks,” Jain said at the 25th SEACEN-FSI Conference of the Directors of Supervision of Asia Pacific Economies in Mumbai. - Business Line

🍒    EbixCash IPO to debut in July. Know how to apply : Ebixcash said that it plans for an IPO (initial public offering) in July. Ebixcash eyes to raise ₹6,000 crore. Ebixcash is a subsidiary of Ebix Inc, an US-based tech company, listed on Nasdaq.  IPO is an event where shares of a particular company are sold to retail investors and institutional investors.- Business Line

🍒    Nexus Select Trust raises ₹1,000 crore via NCDs to refinance bank loans : Nexus Select Trust has raised ₹1,000 crore through the issue of non-convertible debentures to refinance bank loans. The Blackstone-sponsored real estate investment trust issued the NCDs in two tranches. Tranche A for ₹700 crore, has a tenure of three years, with a coupon of 7.86 per cent payable quarterly. Tranche B for ₹300 crore has a tenure of five years and is priced at 8 per cent coupon, payable quarterly. - Business Line

🍒    Credit cards in force touch new high in April even as rollovers decline : Credit cards are no longer an urban preserve. Credit cards in force (CIF) reached a record high in April this calendar year, with 86.5 million cards in circulation, as banks permeated tier II, III, and IV centres. Industry CIF increased by 1.2 million in April to reach an all-time high of 86.5 million,” said ICICI Securities in a note. In terms of market share, the biggest gainer was Axis Bank, which benefited from the Citi acquisition. “Axis Bank’s market share increased from 11.7 per cent in February to 14.2 per cent in April, led by its acquisition of Citi’s consumer business,” the note read. - Business Standard

🍒    HDFC Life jumps 6% on robust management commentary : Shares of HDFC Life jumped 6 percent in early trade on June 16 on post robust commentary by the top management. "We have typically grown 1.8x to 2x of the private sector and slightly higher as a multiple of the overall industry. May was better than April and hopefully, June will be better than May," MD & CEO Vibha Padalkar told In a CNBC-TV18 on June 16. "That's how a turnaround from being an average ticket size is focus sector, we are moving into deeper penetration." "Retail AP business we grew 9 percent. This was 1.8x of the sector. Our market share expanded from about 16.5 percent to 16.7 percent. Similarly on group business also we retained our number one position in the private sector," she said. - moneycontrol.

🍒    Exim Bank sees loan growth of 14-15% for FY24: Tarun Sharma : The Export-Import Bank of India, or Exim Bank as it is popularly known, is expecting loan book growth of 14-15 percent for FY24, Tarun Sharma, the deputy managing director (DMD) of the institution that provides financial, advisory and support programmes to promote trade and investment, told Moneycontrol in an exclusive conversation. "We are expecting similar levels of 14-15 percent (as seen in FY23). So last year, the commercial book grew more rapidly than the policy business. And the reason for that is we are seeing that post-COVID, we've seen companies now, again, looking at making investments, increasing capacity, growing further," said Sharma. - moneycontrol.

🍒    Sebi slaps Rs 87 lakh fine on 15 individuals for manipulating share prices of Kapil Raj Finance : Capital markets regulator Sebi on Friday slapped fines totalling Rs 87 lakh on 15 individuals for manipulating the share prices of Kapil Raj Finance. The Securities and exchange board of India (Sebi) investigated the trading activities of certain entities in the scrip of Kapil Raj Finance Ltd (KRJFL), a BSE-listed entity. - moneycontrol.

🍒    Rupee spurts 31 paise to a month high against US dollar on stocks rally : The rupee rebounded by 34 paise to close at a month high against the US dollar on Friday amid domestic equity indices surging to record high levels and losses in crude oil prices. FII inflows into local equities and the greenback trading near one-month low levels also bolstered the rupee sentiment, analysts said.At the interbank foreign exchange, the domestic unit opened higher at 81.97 and moved in a range of 82.02 to 81.86 in the day trade.The unit settled at 81.94 against the US dollar, reflecting gains of 31 paise over the previous close. - Business Line

🍒    Incremental Credit-Deposit ratio of Scheduled Banks’ declined in the financial year so far : The incremental credit-deposit (C-D) ratio of scheduled banks’ declined in the financial year so far, as incremental deposit accumulation has been almost two times the credit disbursement. The incremental C-D ratio since March-end till June 2, 2023, declined to 50.24 per cent against 95.17 per cent in the year-ago period (March-end to June 3, 2022). The C-D ratio conveys how much of each rupee of deposit is going towards credit markets. A higher growth in this ratio suggests credit growth is rising quickly, which could lead to excessive risks and leveraging on the borrower’s side. “In the case of banks, it could imply that there will be a rise in non-performing assets when the economic cycle reverses. This ratio serves as a useful measure to understand the systemic risks in the economy,” according to the RBI. - Business Line

🍒    Sensex and Nifty reach new record highs on banking and financial sector boost : The 30-share BSE index zoomed 466.95 points or 0.74 per cent to settle at a record closing high of 63,384.58. During the day, it rallied 602.73 points or 0.95 per cent to 63,520.36.  The NSE Nifty climbed 137.90 points or 0.74 per cent to end at its lifetime peak of 18,826. Bajaj Finserv was the biggest gainer in the Sensex pack, rising 2.21 per cent, followed by Titan, ITC, Kotak Mahindra Bank, HDFC Bank, HDFC, Bajaj Finance, IndusInd Bank, ICICI Bank, HUL, Reliance Industries and Mahindra & Mahindra. Wipro, Tata Consultancy Services, Power Grid and Tech Mahindra were the laggards. - Business Line

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