Banking News | Banks India 2013, Page 2

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Latest Base Rates for banks in India

Base Rate Comparison of Banks in India

All public and private sector banks are using the new base rate regime. The base rate is the minimum rate that a bank will lend money to anyone. Think of it as a floor below which RBI will not allow banks to lend to you. The latest increase in the interest rates by RBI has forced major private banks like ICICI, Axis Bank, HDFC and also PSBs like SBI, PNB, CBI, BoB etc to increase their base rates.

Here is the list and comparison of the latest base rates for most public and private sector banks – (Effective Aug 2011)

Latest Base Rates for Banks

Base Rates Comparison for Banks

Previously, banks used to price the loans they offered to you on a complicated system called benchmark prime lending rate (BPLR). Each bank has its own BPLR methodology which made it difficult for borrowers to compare rates across banks.

Now, with the base rate in place, it will be easier for all of us to compare across banks and to get a more transparent view on how the interest rate for the loan is being arrived at. Here is the base rates for major banks in india. (Last Updated: Aug 18, 2011)

Bank Latest Base Rate (%)
State Bank of India 10.00
HDFC Bank 10.00
Axis Bank 10.00
ICICI Bank 10.00
Union Bank of India 10.75
Punjab National Bank 10.75
Bank of India 10.75
Central Bank of India 10.75
Bank of Baroda 10.75
Dena Bank 10.70
Canara Bank 10.75
Indian Overseas Bank 10.75
Vijaya Bank 10.65
Corporation Bank 10.65
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RBI increases Repo Rate to 8%

RBI has yet again increase the policy rates.

* Repo Rate hiked by 50 bps to 8%, effective immediately
* Reverse Repo Rate adjusts 50 bps higher to 7%
* Cash Reserve Ratio kept unchanged at 6%

All bank related interest rates can be seen here – http://banks-india.com/banking-system/bank-related-rates/

MAIN HIGHLIGHTS

* Retains FY12 GDP growth projection around 8%
* Ups Mar-end inflation projection to 7% vs 6% earlier
* Inflation to remain elevated for “few more months”
* Cuts FY12 M3 growth to 15.5% vs 16% earlier
* Cuts FY12 credit growth projection to 18% vs 19%
* Steps to reinforce cumulative impact of past steps on demand
* Steps to maintain policy credibility in controlling inflation
* Policy steps to anchor inflation expectations medium-term
* Stance to change once sustainable downturn seen in inflation
* Policy stance to depend on evolving inflation trajectory
* Controlling inflation “imperative” to sustain growth
* Curbing inflation “imperative” to up potential econ growth

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List of ASBA Banks

SEBI has introduced a supplementary process for applying in IPOs (Initial Public Offerings) through ASBA (Applications Supported by Blocked Amount) process which is now mandatory process for Non-Retail applications. If you are looking on how to apply for IPO using ASBA then you can visit here for step wise application process.

Meaning of ASBA: ASBA is an application for subscribing to an issue, containing an authorisation to block the application money in a bank account.
Self Certified Syndicate Bank (SCSB): SCSB is a bank which offers the facility of applying through the ASBA process.

List of SCSB or ASBA Banks - For details of designated branches click on respective banks below:

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SBI PO Exam – 1000 posts

The SBI (State Bank of India), India’s top public sector bank has announced under SBI PO Recruitment 2011 to appoint 1000 Probationary Officers. SBI is the nation`s largest bank with over 2 lakh employees in about 12400+ branches.

Attempt the Bank PO Online Test here

Post – Probationary Officers
Vacancies – 1000 posts
Payscale - Rs.27800 /month(approx.)

Important Dates :
Online Registration – 18.05.2011 to 09.06.2011
Written test – July 24, 2011

Eligibility: If you are looking to apply for SBI PO recruitment 2011, following is the criteria for eligibility for selection -

* Must be within 21 – 30 years (as on 1.05.2011)

* Graduation (degree) in any discipline, as on May 1, 2011 (should be complete)

The selection process of SBI PO recruitment 2011 has written test (objective & descriptive test) for 250 marks. Apart from scoring high percentile in each objective paper, overall aggregate of 40% is necessary for being considered for Interview.

Application Fee and Application Process: Rs.500(Gen/OBC) or Rs.50(SC/ST) have to be paid at any branch of State bank of India before June 6, 2011. The details of payment & other personal details must be filled in the application & submitted online. (Candidate’s photo & signature must be scanned & attached along with the online application). The application printout can be preserved for reference purposes.

Interested applicants can start the application process by downloading the SBI PO recruitment 2011 notification from the official website here (pdf file). This file contains the list of exam centers for SBI PO Exam and also the fee submission vouchers.

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Indian Bank to come up with FPO in Aug – Sep

Another PSU bank, Indian Bank, is planning to file for Follow-on Public Offer (FPO) with SEBI in July and seeing to hit the market in Aug – Sept.

Indian Bank has earlier informed BSE that the Bank has received the approval of Government of India to raise an additional Equity Capital of Rs. 61.40 crore through book-building process by its Follow-on Public Offer, comprising 6.14 crore Equity Shares of Rs. 10/- each at a premium to be decided by the Bank.

The closing price of the share on May 18th was 220.35 and at this valuation the size of the FPO will be around Rs. 1350 crores or $300M.

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Base Rate, BPLR increased by SBI

Nation’s biggest bank, State Bank of India has increased its base rate and BPLR (Benchmark Prime Lending Rate) by 75 basis point which was kind of expected after RBI’s rate hike last week.

The SBI bank’s base rate or the minimum lending rate is now 9.25% and the BPLR is now14%.

Comparison of Base Rates

Base Rates comparison of Banks

Base Rates comparison of Banks

“The increase in lending rates is in line with the policy rate rise by RBI earlier this month, which was aimed at curbing inflation,” said Managing Director and Chief Financial Officer Diwakar Gupta.

After the increase of the rate by RBI last week, several banks have increased their base rates and rates in some of the banks are now in double digits e.g. PNB, UBI, BOI.

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Analysis of RBI Policy

The highlights of the Reserve Bank of India’s

Monetary Policy Statement for 2011-12 (Apr-Mar):

 

MEASURES

* RBI Policy shifts to single rate regime

* Operating target of policy to be weighted average call money rate

* Hikes Repo Rate 50 bps to 7.25% with immediate effect

* Ups Reverse Repo Rate 50 bps to 6.25% with immediate effect

* Keeps Bank Rate unchanged at 6.0%

* Keeps Cash Reserve Ratio unchanged at 6.0%

* Ups savings bank rate to 4.0% from 3.5% with immediate effect

* Starts marginal standing facility for banks at 8.25%

* To foster price stability, sustain medium-term growth

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PROJECTIONS

* Projects FY12 GDP growth in 7.4-8.5% range

* Projects Mar-end inflation at 6.0% with upward bias

* Projects FY12 money supply growth at 16%

* Projects banks’ FY12 credit growth 19%

* Projects banks’ FY12 deposit growth at 17%

* See Apr-Dec inflation close to Mar-end level

* Inflation projection factors in fuel price hike

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OPERATIONAL CHANGES

* RBI Policy incorporates some suggestions of Mohanty panel

* Marginal standing facility effective from May 7

* To issue separate guidelines for marginal standing facility

* Interest rate corridor to be 200 bps

* Reverse Repo Rate to be function of Repo Rate

* Retain flexibility to change interest rate corridor

* Shift to single rate to accurately signal policy stance

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STANCE

* Steps to curb inflation, anchor inflationary expectations

* Policy steps to rein in demand pressures

* Policy steps to sustain growth medium-term

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INFLATION

* Inflation persistently above comfort level

* Surge in non-food inflation suggests firm demand pressure

* Global commodity price uncertainty risk to India inflation

* Surge in crude oil yet to pass to domestic prices

* Impact of monetary tightening still unfolding

* Clear need to persist with anti-inflationary stance

* Signs of growth moderation emerged in late FY11

* Growth moderation to ease demand-side inflation

* Demand pressure to ease H2 on growth slowdown, monetary steps

* To maintain liquidity situation in balance

* Inflation was primary macroeconomic concern FY11

* Inflation driven by structural, transitory factors

* Food, fuel, power group added 60% to WPI rise Apr-Jul

* WPI surge Dec-Mar on fuel, power, non-food manufactured goods

* Inflationary pressure from food clearly became generalized

* Money supply growth eased FY11 on slow deposit growth

* Money supply growth eased also on high currency growth

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GROWTH

* Despite IIP slowdown, factors imply strong economic activity

* Manufacturing cos’ order book up 7% Q3 vs 9% Q2

* Order book growth suggest sustained demand with some easing

* Business expectation index rose in Q2, Q3 FY11

* Leading indicators show growth momentum in services sector

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PRUDENTIAL, BANKS

* To adhere to begin Basel-III from January 2013

* Studying Basel-III norms for apt implementation

* Disseminating information on Basel-III to banks

* Preparing norms for internal rating under Basel-III for bks

* Ups banks’ provisioning on “certain” NPAs

* Provisioning on banks’ sub-standard loans hiked to 15% vs 10%

* Additional 10% provision on unsecured sub-standard loans

* 25% provision on secured portion of up to 1-yr doubtful loans

* 40% provision on secured portion of 1-3 yr doubtful loans

* 2% provision on recast loans in standard assets for 1st 2-yr

* Restructured NPAs upgraded to standard to have 2% provision

* Caps banks fund into debt MFs liquid plans at 10% of net worth

* 6-mo to comply to banks with over 10% invest in MF liquid plans

* Guidelines on foreign bank presence being formulated

* Draft norms on new bank licenses being finalized

* Panel for holding co structure for banks to give report end-May

* Set up panel to review supervisory policies for banks

* Panel set up for reviewing norms for NBFCs

* Panel for review of NBFC norms to submit report end-Jun

* Transaction worth 610 mln rupee/mo settled via mobile-banking

* Bk loans to micro finance cos Apr 1 onwards to be priority sector

* To issue norms on credit default swaps shortly

* Short sale period in gilts extended to 3-mo vs 5-day now

* Money supply growth eased also on high currency growth

* Greater convergence in base rates of major banks

* Effective lending rates may rise to 10.3% FY12 vs 9.7% FY11

* Non-bank sources of funds, mainly FDI declined FYll vs FY10

* Funds from bks more than offset fall in non-bk fund sources

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GLOBAL

* Global recovery expected to sustain in 2011

* Growth in emerging economies expected to decelerate

* Current account deficit to ease to 2.5% FY11 vs 2.8% FY10

* Global commodity price rise poses downside risk to growth

* Global oil demand may rise on economic reconstruction

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