Rbi news

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☕ 16.06.2023 : Today's Banking / Financial News at a Glance 

🍒    RBI to conduct Rs 50,000 cr via 14-day variable rate reverse repo auction today : The Reserve Bank of India (RBI) said it will conduct a 14-day variable rate reverse repo auction for a notified amount of Rs 50,000 crore on June 16. The auction for the same will take place between 10:30 am and 11:00 am, and the reversal of these funds will take place on June 30. This is the seven auction so far this month conducted by the central bank to remove excess surplus liquidity from the banking system. Currently, the liquidity in the banking system is estimated to be in surplus of around Rs 1.47 lakh crore. All the previous VRRR auctions conducted by the central bank in the last few days received a muted response from the banks considering the outflows from the banking system. - moneycontrol.

🍒    Govt, RBI looking to integrate GSTN with TReDS via account aggregator : The government and Reserve Bank of India (RBI) are looking to integrate GSTN (Goods and Services Tax Network) with TReDS (Trade Receivables Discounting System) platforms to enable direct sanctions of MSME invoices. Integration will ensure that e-invoices raised by MSMEs on GSTN can come directly to the TReDS portal, thus negating the need for any additional activity or documentation, industry players said, adding that it could greatly improve the working of TReDS platforms over a period of time. It will also lead to faster loan underwriting and sanctions as sourcing directly from the GST platform will provide more assurance and comfort to financiers with respect to the genuineness of invoices. In addition, it will help build an alternative credit database, especially for MSMEs with weak or minimal credit history. - Business Line

🍒    PNB, LIC, SBI & BoB look to seek bids for UTI AMC stake, Tata Group expected to put in a fresh bid :  Four state-owned financial entities - Punjab National Bank, Life Insurance Corporation of India, State Bank of India, and Bank of Baroda - that together own just over 45% of UTI Asset Management Company (AMC) are understood to be working on inviting formal bids for selling their stakes, top officials close to the development told ET. Industry sources said these entities have recently appointed merchant bankers to initiate the sale process. Earlier, the Tata Group was understood to be in advanced talks to buy a majority stake in UTI AMC from the four public sector entities, but the discussions fell through after a large investor in the AMC insisted that the other investors follow a formal bidding process to sell their stakes instead of using the nomination route, said one of the officials cited above. There were also some issues that had to be sorted around the stakes held, it is learnt. The Tata Group will now put in a fresh bid for the AMC, officials close to the development said. - eonomic times

🍒    Federal Bank to focus more on remittance biz, sees fintech as growth engine : Given the changing dynamics in domestic remittance business, Federal Bank is looking to reap benefits from the multifold increase in ticket size in the last few years. According to Federal Bank Managing Director and CEO Shyam Srinivasan, the size of domestic remittances business is approximately ₹1,00,000 crore, and remittances from Kerala to other States are around ₹750 crore.“This is a huge market for us,” Srinivasan told businessline. In India, intra-State remittances are increasing, reflecting the changing nature of migration, he said. - Business Line

🍒    Kotak Mahindra Bank launches “ActivMoney” feature for savings account holders : Kotak Mahindra Bank (KMB) has launched “ActivMoney”, whereby customers will get Fixed Deposit (FD) like interest up to 7 per cent on their savings account and the flexibility to access their funds anytime without any penalty on foreclosure. Through ActivMoney, excess funds in the account, beyond a defined threshold, are automatically transferred into an FD so that customers earn a higher interest on their savings.“Default minimum threshold over which the surplus funds earn FD like higher interest rate is ₹25,000 for Savings/Salary/811 accounts and ₹50,000 for current accounts.“ActivMoney spruces up interest income on the savings account with a 7 per cent per annum interest rate (for deposits above 7 days) for 180 days as well as no premature withdrawal charges which otherwise are applicable to a Fixed Deposit,” per the private sector bank’s statement.- Business Line

🍒    Kotak Mahindra Bank gets ₹5,400 crore deposits in ₹2,000 banknotes :  Private sector lender Kotak Mahindra Bank has received about ₹5,400 crore as deposits in ₹2,000 notes following RBI's decision to withdraw these banknotes from circulation, a senior official said on Thursday. - Live Mint

🍒    NaBFID raises ₹10,000 crore through listed bonds : The National Bank for Financing Infrastructure and Development (NaBFID) has raised ₹10,000 crore via maiden issuance of listed bonds of 10-year duration at a coupon rate of 7.43 per cent. The development finance institution’s infrastructure bonds (unsecured non-convertible debt securities) were oversubscribed by approximately 4.7 times (receiving bids aggregating ₹23,629.50 crore), against the base issue of ₹5,000 crore.The DFI, in a statement, said this is the largest debt issuance by an All India Financial Institution (AIFI). NaBFID said it has received AAA credit rating from domestic credit rating agencies. It has received in-principle listing approvals from both BSE and NSE, and the bonds are expected to be listed shortly. - Business Line

🍒    Kotak Mahindra Bank keen on enhancing co-branding pacts : Kotak Mahindra Bank is currently focussing on deepening its existing co-branding partnerships while it is also looking out for partnerships in new segments, says Frederick Dsouza, Business Head – credit cards. In addition to this, the bank is also focussing on expanding its credit card customer base in non-metro cities and towns. “Kotak has been fairly selective about partnerships. Our strategy is achieving scale in the existing partnerships. Also, it is to keep looking out for sectors where we see opportunity to have a large impact,” he said. - financial express

🍒    First Loss Default Guarantee may help expand digital lending, spur competition : The Reserve Bank of India (RBI)‘s circular on first loss default guarantee (FLDG) can help expand the digital lending ecosystem, according to an India Ratings and Research report. The FLDG norms will also increase participation of potential players in digital lending, which could increase the business sustainability of these lending service providers, and increase competition within the segment. The credit agency expects the profitability of originators to improve by 5-15% of the portfolio subject to originator-partner relationship. However, this would depend on the nature of the relationship. - financial express

🍒    Passive breach in HDFC-HDFC Bank: MFs to offload Rs 5,000 crore shares : The impending merger between HDFC Bank and Housing Development Finance Corporation (HDFC) will see around 60 actively-managed equity mutual fund (MF) schemes breach the 10 per cent single stock exposure norm. The passive breach will require fund managers offload shares worth Rs 5,000 crore in the merged entity up as actively-managed schemes can deploy a maximum of 10 per cent of their corpus towards a single stock. Given the prominence of HDFC twins, most fund houses have large exposure to these counters. According to a news report, the Securities and Exchange Board of India is not in favour of providing a special dispensation to fund houses to exceed the 10 per cent cap. - Business Standard

🍒    Reliance in talks with lenders for $2 billion loan to fuel expansion : Reliance Industries Ltd. is in talks with lenders for a foreign-currency loan of up to $2 billion to fuel the ongoing expansion of its oil-to-telecoms business, according to people familiar with the matter. The sprawling firm, controlled by Asia’s richest man Mukesh Ambani, plans to use India’s dedicated external commercial borrowing route to secure the loan, the people said, asking not to be identified because the discussions are private. The facility may have a maturity period ranging between three to five years, one of the people said, and the proceeds will be used for capital expenditure and to refinance another loan that matures in September. - Business Standard

🍒    India's EXIM Bank plans to step up funding for African countries : India's Export-Import Bank plans to step up investments under a government-supported line of credit programme to finance Indian companies looking to access fast-growing African markets, the bank's top official said, part of a move to expand trade ties. Amid rising competition from China, Indian Prime Minister Narendra Modi has stepped up efforts to strengthen ties with African nations via aid for infrastructure projects and private investments by Indian companies. - economic times

🍒    Kedaara in talks with Yes Bank for sale of Spandana Sphoorty : Private equity investor Kedaara Capital, the biggest shareholder of microfinance lender Spandana Sphoorty Financial, has revived plans to sell off the company and has been in discussions with Yes Bank to explore an M&A deal, two people familiar with the development told ET. About 18 months ago, Kedaara had shelved a similar plan following allegations by Spandana founder Padmaja Gangireddy that it was selling off the company to Axis Bank at a "throw-away price". Gangireddy, the then managing director of Spandana, was ejected unceremoniously following a disagreement on the issue with the majority shareholder. - economic times

🍒    Rupee falls 16 paise to 82.21 against US dollar : The rupee depreciated 16 paise to 82.21 against the US dollar in early trade on Thursday, pulled down by the strength of the American currency on the back of a hawkish US Federal Reserve. At the interbank foreign exchange, the domestic unit opened at 82.16, then fell to 82.21, registering a decline of 16 paise over its last close amid a negative trend in domestic equities.- Business Line

🍒    Sensex, Nifty halt 3-day rally; banking, financial stocks weigh : After rallying for the past three days, BSE Sensex fell 310.88 points or 0.49 per cent to settle at 62,917.63. During the day, it tumbled 357.43 points or 0.56 per cent to 62,871.08. The NSE Nifty declined 67.80 points or 0.36 per cent to end at 18,688.10.Wipro was the biggest loser in the Sensex pack, slipping nearly 2 per cent, followed by IndusInd Bank, State Bank of India, Kotak Mahindra Bank, ICICI Bank, HDFC Bank, Infosys, Tata Consultancy Services, HDFC and Bajaj Finserv. On the other hand, Nestle, Mahindra & Mahindra, ITC, HCL Technologies, Asian Paints and Maruti were among the gainers. - Business Line

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