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☕  20.06.2023 : Today's Banking / Financial News at a Glance 

🍒     Bank of Baroda turns second PSU lender to cross Rs 1 trillion in valuation : Bank of Baroda became India's second public sector bank to surpass Rs 1-trillion market cap with the stock hitting a fresh record high. The stock scaled a record Rs 194 a share, up 3 percent from its previous close. State Bank of India is the only Indian PSU lender which has crossed this milestone.The stock is up nearly 20 percent since March 28. The strong gains came after robust earnings in the March quarter as well as for the whole year of FY23. The lender reported its highest quarterly net profit of Rs 4,775 crore in March quarter, recording a 168 percent year-on-year rise. Annually, the bank recorded a profit of Rs 14,110 crore, up 94 percent from Rs 7,272 crore. - moneycontrol.

🍒     PNB Housing Finance gains on 2nd fundraising plan in 3 months : PNB Housing Finance shares opened higher on June 19 after the company announced its second fundraise plan in just under three months. At 9:20 am, the stock was quoting at Rs 577 on the NSE, higher by 1.2 percent from previous close. Moneycontrol was the first to report this in MC Insider edition of June 7. The housing financier’s board will meet on Jun 22 to discuss a proposal to raise Rs 5000 crore through private placement of non-convertible debentures (NCDs). - moneycontrol.

🍒     RBI conducts Rs 75,000-crore 4-day Variable Rate Repo auction yesterday : The Reserve Bank of India (RBI) on June 19 said it conducted a four-day Variable Rate Repo auction for a notified amount of Rs 75,000 crore yesterday. The auction took place between 12:30pm and 1pm and the reversal of these funds will take place on June 23.The central bank usually conducts the repo auction to inject liquidity in the banking system, when it narrows or turns into deficit mode.The liquidity surplus in the banking system narrowed sharply today on account of advance tax outflows last week and payments related to auction of debt securities.- moneycontrol.

🍒     Karur Vysya Bank in expansion mode; sets up 800th branch : Private sector Karur Vysya Bank on Monday under its expansion drive inaugurated its 800th branch in the city, a top official said. The Tamil Nadu-based lender also inaugurated its digital banking unit on the occasion. “We are delighted to inaugurate our 800th branch and other new branches today, which will provide our customers improved access and proximity to the bank’s services,” the bank’s managing director and CEO B Ramesh Babu said in a statement. - financial express

🍒     J&K Bank launches mobile branches to offer services in remote areas of Ladakh : Jammu and Kashmir Bank on Monday launched two mobile branches in Ladakh to offer banking services in remote areas of the Union Territory. "J&K bank today dedicated two mobile branches -- 'J&K Bank on Wheels' -- for public in Ladakh that will extend banking services to the people of various remote and unbanked areas of the UT," a spokesman of the bank said. He said Ladakh Lieutenant Governor B D Mishra inaugurated the two mobile branches at the iconic Leh Gate in the presence of J&K Bank MD and CEO Baldev Prakash. - economic times

🍒     Co-lending could be 5-8% of our book: DCB Bank CEO : In an exclusive chat with businessline, Murali Natarajan, MD & CEO, DCB Bank, says the way forward for the lender would be strong collaborations and product delivery. We have a strategy for core lending segment, that is the products that we don’t do DCB Bank is happy to explore opportunities for co-lending with business partners. Let’s say, a particular NBFC has a product like school finance or two-wheeler loan, which we as a bank are not doing, or the segment to which they [business partner] are doing. For example, the bank may feel that gold loan of ₹50,000 ticket size per individual isn’t the same as a ₹2 lakh loan, the latter being the segment that we serve. Or the purpose may also be different. It could be for business, which is what we do, whereas they [NBFCs] could do a personal emergency, and so on. We have successful co-lending partnerships going on at present. We want to expand it and think that it should be anywhere from 5-8 per cent of our book.- Business Line

🍒     Baring EQT, ChrysCap buy HDFC’s Credila for Rs 10,350 cr : Baring Private Equity Asia (BPEA) EQT along with homegrown PE fund ChrysCapital has acquired Credila Financial Services, the educational loan arm of Housing Development Finance Corp (HDFC), at a valuation of around Rs10,350 crore, sources aware of the development told ET. They will also invest Rs 2000 crore into the company. The offiil signing happenned on Monday evening, HDFC will retain 10% while the PE consortium will own 90% of the company. - Economic times

🍒     RBL aims to expand NIMs; credit cards, MFIs to outpace overall loan book growth : Mumbai: RBL Bank is targeting to expand its net interest margin (NIM) to over 5.2 per cent by the end of FY24 by upping the share of higher-yielding assets in its loan book, a top official has said.The private sector lender will continue to maintain the share of unsecured loans like credit cards and microfinance by growing them at over the 20 per cent overall loan book increase targeted for every year till FY26, R Subramaniakumar told PTI.  The bank had reported an expansion in NIMs to over 5 per cent in the March quarter, in line with the industry trend. - economic times

🍒     RBI penalizes 3 cooperative banks for rule violations and cybersecurity lapses : The Reserve Bank of India (RBI) announced on June 19 that it has imposed monetary penalties on three cooperative banks, namely The Urban Co-operative Bank, Andhra Pradesh Mahesh Co-operative Urban Bank, and Dombivli Nagari Sahakari Bank, for violating rules. The RBI has imposed a penalty of Rs 50 lakh on Dombivli Nagari Sahakari Bank, Rs 65 lakh on Andhra Pradesh Mahesh Co-operative Urban Bank, and Rs 6 lakh on The Urban Co-operative Bank, according to the releases. -moneycontrol.

🍒     RBI injects ₹75,000 crore into the banking system as liquidity tightens due to tax outflows : The Reserve Bank of India (RBI) conducted a four-day variable rate repo (VRR) auction on Monday to inject liquidity into the banking system, even as overnight money market rates hardened, rising above the repo rate. Banks’ sought to draw funds aggregating ₹75,695 crore from the RBI against the notified amount of ₹75,000 crore at the auction. They received funds aggregating ₹75,004 crore at the cut-off rate of 6.51 per cent. Bankers’ attributed the tightness in liquidity in the banking system to outflows related to advance tax and indirect tax payments. This resulted in the overnight money market rates hardening above the repo rate of 6.50 per cent. - Business Line

🍒     HC grants interim stay on RBI circulars allowing banks to declare account as fraudulent without hearing : The Bombay High Court on Monday granted interim stay on the effect of the master circulars issued by the Reserve Bank of India that permits banks to declare any account as a fraud account without a hearing. A division bench of Justices Gautam Patel and Neela Gokhale stayed effect of the Reserve Bank of India Master Directions on Frauds Classification and Reporting by Commercial Banks and Select FIs issued in 2016 till September 11 when it would hear petitions challenging the same. The petitions include two filed by erstwhile promoters of Jet Airways Naresh Goyal and his wife Anita Goyal.The pleas said the circulars were in violation of the principle of natural justice as no opportunity to be heard was being given to borrowers before classifying their accounts as fraudulent.- economic times

🍒     Govt starts interministerial discussions on the upcoming IBC Amendment Bill : The government has started interministerial discussions on the upcoming Insolvency and Bankruptcy (IBC) amendment Bill, which proposes an overhaul of the law, senior officials told Business Standard.  The Bill proposes a separate framework for real estate insolvency with certain exemptions. The draft Bill has also inserted an enabling clause to allow the government to increase the ambit of prepackaged insolvency for larger companies in the future. - Business Standard

🍒     Centre proposes to keep vehicle insurance premium unchanged for most categories : The centre has proposed keeping the rates of motor third party premium unchanged, across most categories, for the financial year 2023-24. According to a draft notification for the same, slightly lower insurance premium rates have been proposed for three-wheelers in both electric and conventional rickshaws. These rates are referenced by insurance companies while fixing the premium rates for vehicles. - economic times

🍒     India, Philippines sign MoU on FinTech cooperation : A Memorandum of Understanding (MOU) between the Department of Economic Affairs, Ministry of Finance, Government of India and the Department of Finance, Government of Philippines, on Financial Technology (fintech) cooperation was signed in Manila on Monday. The MOU was signed by Shambhu S. Kumaran, Ambassador of India to the Philippines and Benjamin E Diokno, Secretary, Department of Finance (DOF). - economic times

🍒     Max Life Insurance picks 2.99% stake in Capital Small Finance Bank for ₹49.5 crore : Max Life Insurance Company Limited (Max Life), has picked a 2.99 per cent equity stake in Jalandhar-headquartered Capital Small Finance Bank (CSFB) for a consideration of ₹49.50 crore. Towards this investment, as many as 10,57,700 equity shares of CSFB of ₹10 each at a premium of ₹458 per equity share has been allotted to Max Life. Sarvjit Singh Samra, MD & CEO, Capital Small Finance Bank said, “We are thrilled to announce the equity investment from Max Life Insurance Company Limited. This investment marks a significant milestone for Capital Small Finance Bank and reinforces our commitment to delivering exceptional value to our customers. It is a testament to the strength of our bank and the trust that Max Life Insurance has placed in us”.- Business Line

🍒     Deposit of ₹2,000 notes, which RBI decided to withdraw from circulation as a part of its currency management, in Banks could result in a boost in bank deposits, repayment of loans, consumption, RBI retail CBDC (central bank digital currency), and a possible GDP boost, according to State Bank of India’s economic research report ‘Ecowrap’. “The ‘precision strike’ by RBI hits the right notes on multiple counts, taking pressure off substantially from near war-like quest for deposits from the banking system while also smoothening the bias for higher interest rates going forward,” said Soumya Kanti Ghosh, Group Chief Economic Adviser, SBI. Deposit of ₹2,000 notes could result in a boost in bank deposits, repayment of loans, consumption: SBI Ecowrap - Business Line.

🍒     Adani initiates stake sale talks for its NBFC arm : The Adani group has initiated talks with international strategic and financial investors to sell a stake in its non-banking finance business- Adani Capital. The process of divestment just began a few weeks back and is at initial stages. It is gathered that much of the transaction is presently being worked out directly by the senior leadership of the group. “Some of the large players in the sector have been sounded off about the deal. If the response from these players isn’t encouraging, which will be known in about three months or so, the group may formally engage with bankers to initiate talks with private equity players.According to sources, a few NBFCs with assets size of over ₹40,000 crore have been approached so far. - Business LIne

🍒     TPG India sells entire 2.65% stake in Shriram Finance for ₹1,390 crore : TPG India Investments II Inc sold its entire 2.65 per cent stake, or 99.2 lakh shares, in Shriram Finance via multiple block deals on the BSE on Monday, as per exchange data.  The shares were traded at ₹1,401.00 against Friday’s close of ₹1,401.15. Following the block deals, the stock surged to touch a one-month high of ₹1,500 intraday but later pared some gains to end 5 per cent higher at ₹1,469.60 on the BSE. As per the transaction price, the deal value stands at around ₹1,390 crore. - Business Line

🍒     CoinSwitch to launch stock trading platform : CoinSwitch is planning to launch a platform for trading Indian stocks as the cryptocurrency exchange has set its eyes on conventional investment products. With the proposed launch, the crypto unicorn will be competing with new-age players such as Zerodha, Upstox, and Groww as well as traditional giants such as ICICI Securities, HDFC Securities and Kotak Securities. Ashish Singhal, Co-founder and CEO, CoinSwitch, said, “More than 19 million Indians have initiated their investment journey on our platform with crypto. We aim to grow alongside them by offering a diverse range of asset classes on our wealth tech platform that are simplified, and tailored to their requirements. This includes multiple asset classes such as fixed deposits, mutual funds, Indian Stocks, etc.” - Business Line

🍒     SIP closures rise 7.4% month-on-month in May : The number of systematic investment plan (SIP) accounts being discontinued rose 7.4 percent month-on-month to 14.19 lakh in May, despite the stellar inflow into mutual funds through the route. At the same time, the number of new SIP registration rose to 24.7 lakh last month from 19.56 lakh in April, implying fresh registration of over 5 lakh, data with the Association of Mutual Funds in India (AMFI) showed. The higher number of SIP registration than discontinuation shows investors' continued confidence in the route, DP Singh, Deputy MD and CBO at SBI Mutual Fund, said. This could also be due to an easy cancellation facility available through online modes, he added. This could also be due to an easy cancellation facility available through online modes, he added. - moneycontrol.

🍒     Sensex, Nifty drop on profit-taking near record highs : The Nifty index closed 0.37% lower at 18,755.45, while the benchmark S&P BSE Sensex fell 0.34% to 63,168.30. They rose as much as 0.30% earlier, with the Nifty coming within 10 points of its record high of 18,887.60. In India, 10 of the 13 major sectoral indexes declined. - Business Line

🍒     Rupee falls 3 paise to 81.93 against US dollar : The rupee depreciated by 3 paise to close at 81.93 against the US dollar on Monday, even as the American currency stood firm against major rivals overseas. At the interbank foreign exchange, the domestic unit opened lower at 81.93 and moved in the range of 82.01 to 81.90 intra-day. The unit settled at 81.93 (provisional) against the US dollar, reflecting a loss of 3 paise over the previous close. - Business Line

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