EDINBURGH (TIP): Scotland’s proindependence leader Alex Salmond said the “eyes of the world” were on a momentous referendum next week as officials reported record numbers registering to vote on breaking away from the United Kingdom. Salmond said the September 18 vote would be “a process of national empowerment”, as new figures came out showing a record 4.3 million people had registered to vote — higher than for any previous elections in Scotland. “Scotland is on the cusp of making history.
The eyes of the world are upon Scotland,” Salmond, Scottish First Minister and the head of Scotland’s current devolved government, said in an Edinburgh speech. “On September 18, we the people hold our destiny in our own hands.” British media said new figures meant 97 percent of the electorate had now registered to vote, including many 16- and 17-year-olds who are allowed to take part under referendum rules.
Polls show Scottish voters are almost evenly divided between the “Yes” and the “No” sides although one survey so far has put the pro-independence camp just ahead of the unionists. The most recent, published on Wednesday by Scotland’s Daily Record newspaper, showed 53 percent against independence and 47 percent in favour, without counting undecided.
The vote would bring to an abrupt end a 307-year-old union between England and Scotland and create the newest state in Europe since the disintegration of Yugoslavia. – ‘Huge pressure on Madrid’ – 100 journalists from around the world were present at Thursday’s press conference, with many asking about what Scotland’s relation to their country would be. Many nations with separatist movements are following the campaign closely, including Spain where the government has ruled out a referendum for Catalan independence or devolution. On Thursday hundreds of thousands of Catalan nationalist demonstrators, some waving the blue and white Scottish flag, filled the streets of Barcelona in a mass rally to demand a vote like Scotland’s. “People in Catalonia don’t necessarily want independence but they want to have the right to vote.
And they see that here it’s possible,” said Carles Costa from TV3 public television in Catalonia, who was at Salmond’s press conference. “A ‘Yes’ vote would put a huge pressure on Madrid. Scotland is not a remote country somewhere in the world. It’s just next door,” he said. “Even with a ‘No’, people in Catalonia will say, ‘Why is this not possible in Spain?’” But Shuhei Nakayama from Japanese broadcaster NHK said most people in Japan had “a confused idea of the situation”.
“Most don’t know Scotland is already a region with many powers. Some think it’s a country already as they have a football team,” he said. “It’s very interesting to see a nation that might break away without any violence,” he said. The campaign — and the promise of greater devolution if the “No” camp wins the vote — has also bolstered demands from local authorities for greater powers within England and Wales. Deputy Prime Minister Nick Clegg is on Friday expected to launch a report calling for a major programme of devolution within England after the next general election in May 2015. – ‘Responsible and prudent’ – International Monetary Fund on Thursday warned that a vote for independence would raise “complicated issues” and could upset financial markets.
“While this uncertainty could lead to negative market reactions in the short term, the longer term will depend on the decisions being made during the transition,” IMF spokesman Bill Murray said. The Royal Bank of Scotland has said it would relocate its registered offices in case of a “Yes” vote, saying this was the “responsible and prudent thing to do,” but underlining it would not mean moving jobs south. RBS was bailed out by the British government following the 2008 financial crisis and its announcement came after London-based Lloyds Banking Group also said it had plans on possibly switching key operations from Scotland to England.
Edinburgh-based RBS is 81-percent owned by the British state, which also retains a 25-percent stake in bailed-out Lloyds. Big business leaders have mostly lined up against independence, although the chief executive of Scotland’s largest fund manager, Aberdeen Asset Management, has said that an independent Scotland would be “a big success
Tag: Banking
-
SCOTLAND READY TO MAKE HISTORY: INDEPENDENCE LEADER
-
Senator Tony Avella- the man you can trust to be on your side
Remember to vote for Tony Avella on Tuesday, September 9
Senator Tony Avella has dedicated his life to fighting for middle-class families and progressive Democratic values. Senator Avella’s distinguished public service career began over 30 years ago as an aide to New York City Council Member Peter Vallone, Sr. Senator Avella later served as an aide to Mayors Koch and Dinkins and as Chief of Staff to the late State Senator Leonard Stavisky and to State Senator Toby Stavisky. Prior to seeking public office, Senator Avella served in numerous capacities as a civic activist and was a member of Queens Community Board #7. In 1997, Senator Avella was awarded New York State’s Community Service Award for his numerous volunteer and civic endeavors on behalf of all New Yorkers.
In 2001, Senator Avella won election to the New York City Council in the 19th District – Northeast Queens and was re-elected with an overwhelming majority in both the 2003 and 2005 elections. As a member of the City Council, Senator Avella served as Chair of the Zoning and Franchises Committee and was a member of five Council committees: Higher Education, Housing and Buildings, Fire and Criminal Justice Services, Land Use, and Veterans.
Senator Avella was also the founder and Chair of the first Italian-American Caucus of the City Council. During his tenure on the Council, Senator Avella authored several important pieces of legislation. Signed into law in 2005, his “Demolition by Neglect” bill enabled the Landmarks Preservation Commission to prevent the willful destruction of our City’s treasured landmarks by unscrupulous property owners. Senator Avella’s legislation was strongly supported by 46 preservation and civic groups including the Landmarks Conservancy, the Historic Districts Council and the National Historic Trust.
As a trusted public servant, Senator Avella has made fighting over-development and protecting our quality of life his top priorities. In the City Council, Senator Avella led the fight citywide against overdevelopment, the proliferation of McMansions, and other major abuses of the City’s building and zoning codes. In an effort to preserve the unique residential character and quality of life in neighborhoods throughout the City, Senator Avella helped create new zoning districts such as R2A, which prevents the construction of McMansions, rezoned major portions of his district as well as numerous other neighborhoods in the City, and enacted citywide amendments to the “Community Facilities” section.
Senator Avella’s hard work resulted in the first real changes in the City’s zoning code in over 40 years. In addition to his efforts to stop out-ofcharacter construction, Senator Avella was at the forefront of the battle to reform the City’s Department of Buildings and the Board of Standards and Appeals. Senator Avella was also the acknowledged leader in the City Council for landmark preservation, animal welfare, good government, and Veterans’ issues and benefits. As a member of the City Council, Senator Avella refused the “lulu”; an additional taxpayer funded salary increase in return for loyalty to council leadership instead of taxpayers.
Senator Avella fought against and subsequently refused the 25% City Council pay raise, which he considered unethical. Senator Avella was honored by numerous fraternal organizations, civic associations, sports and school/educational groups. Senator Avella has received such honors as the “Friend In High Places Award” from the Historic District Council, the Community Mayor’s Humanitarian Award, the coveted Lucy G. Moses Preservation Award from the New York Landmarks Conservancy, and the Benefactors’ Award from the Alley Pond Environmental Center.
In 2009, Senator Avella received the “New York City Human Rights Award” for obtaining the highest score of elected officials in New York City on the Human Rights Project’s report cards. A city-wide human rights coalition with over 100 groups from all over the City, the Human Rights Project is the lead organization of the New York City Human Rights Initiative.
First elected to the State Senate in 2010, Senator Avella, as a freshman senator, was appointed ranking member of the Cities and Environmental Conservation Committees, and has served on the Education, Aging, Banking, and Veterans, Homeland Security and Military Affairs Committees. His reputation as a staunch reformer has helped to bring real change to Albany.
As a state Senator, he is proud of bringing ethics reform to New York’s Capitol, and has again refused any “lulus” for his committee positions. A strong advocate for reform and transparency in government, Senator Avella is fighting to transform the State Senate so that it works for the people once again. Senator Avella spent his first few years in Albany fighting for the people that elected him. He is proud to have voted for four on-time budgets without raising taxes. As ranking member of the Environmental Conservation Committee, he lead the fight in advocating for a ban on hydrofracking, an extremely dangerous drilling practice that poses a risk to local water supplies.
He introduced and passed in the Senate legislation that would equalize co-op and condo property tax assessments with one-two and three family homes and help lower costs at the gas pump. Re-elected by an overwhelming majority in 2012, Senator Avella has continued his dedicated service to the people of the 11th Senatorial District. He has continued to fight for progressive legislation by working to increase the minimum wage, pass the SAFE Act – the toughest gun control laws in the nation, and implement Universal Pre-K. He has prioritized women’s rights by fighting for and co-sponsoring the Women’s Equality Act.
He is an avid advocate for animal rights, having introduced multiple bills in support of the protection of animals, as well as sounded the alarm against animal rights violations. During this past legislative session, Senator Avella passed seventeen bills, four of which have been passed in the Assembly and two of which have been signed into law. He currently serves as the Chair of the Social Services Committee, Vice-Chair of the Environmental Conservation Committee, and is a member of the Transportation, Education, Codes, Housing, NYC Education, Insurance, Judiciary and Banks Committees. Senator Avella is a graduate of Hunter College of the City University of New York.
He is a lifelong Queens resident and currently resides in Whitestone with his wife Judith. Avella has been endorsed by a number of Unions which include Local 246 , SEIU Automotive/Mechanical, Motor Vehicle Operations Union Local 983, 1199 SEIU, United Healthcare East, Communications Workers of America (CWA) District 1 Retail, Wholesale and Department Store Union (RWDSU), Plumbers Union Local 1, International Union of Elevator Constructors (IUEC), Uniformed Firefighters Association of New York (UFA-NYC), Uniformed EMTs, Paramedics & Fire Inspectors – Local 2507, FDNY, Fire Alarm Dispatchers Benevolent Association, FDNY, New York State Troopers, Council of Administrators and Supervisors, Nassau County Sheriff’s Correction Officer Benevolent Association, Correction Officers Benevolent Association (COBA), NYC Patrolmen’s Benevolent Association (PBA), Public Employees Federation (PEF), New York State Supreme Court Officers, New York State PBA, New York State Nurses Association, New York State Police Investigators Association. Mayor Bill de Blasio and Congressmember Steve Israel are among the elected officials who have endorsed Tony.
The organizations which have endorsed him are League of Humane Voters; League of Conservation Voters, Empire State Pride Agenda, Citizens Union and Sierra Club. -
RBI NORMS MAY HIT CO-OPERATIVE DEPOSITORS
MUMBAI (TIP): In a bid to encourage strong banks take over ailing co-operative banks, the Reserve Bank of India (RBI) has said that large depositors in failed cooperatives must now sacrifice a portion of their deposits in proportion to the deposit erosion. This is to ensure that other lenders can acquire the failed bank without incurring any losses. Until now, a bank acquiring a cooperative had to pump in funds if the failed bank’s assets could not cover at least 65% of its total deposits.
In its latest circular, the RBI has said that under the new guidelines, the acquiring bank should not incur any loss arising out of the said merger or transfer of assets and liabilities of cooperative banks. “Big depositors holding deposits in excess of Rs 1 lakh each will be required to sacrifice in proportion to the deposit erosion of the target bank,” the circular said. At present, all bank deposits are covered up to Rs 1 lakh by the Deposit Insurance and Credit Guarantee Corporation (DICGC) — an arm of the RBI. DICGC receives its funds from premium collected from all banks (10 paise for every Rs 100 of deposits).
A bulk of the premium comes from commercial banks, but most of the funds are consumed by claims in respect of cooperative banks. The deposit insurance fund stood at Rs 36,120 crore as of March 2013, which was enough to cover 1.7% of insured bank deposits (up to Rs 1 lakh). “With a view to ensuring that the process of consolidation by way of non-disruptive exit of weak entities by a scheme of transfer of assets and liabilities of UCBs (urban cooperative banks) to commercial banks is undertaken in a transparent manner without affecting the financial health of the acquiring entities and the banking system as a whole, it has been decided to modify the existing guidelines for transfer of assets and liabilities of UCBs to commercial banks,” RBI said in the circular.
During the year 2012-13, DICGC settled aggregate claims for nearly Rs 200 crore in respect of 63 co-operative banks. The corporation has made provisions of over Rs 1,000 crore towards the estimated claim liability in respect of depositors of 195 banks, which are under amalgamation/liquidation and whose licence/application to carry on banking business has been cancelled. -
PM ‘JAN DHAN’ YOJANA LAUNCHED; 1.5 CRORE BANK ACCOUNTS OPENED IN A DAY
NEW DELHI (TIP): Prime Minister Narendra Modi on Aug 28 launched his government’s mega scheme ‘Jan Dhan Yojana’, declaring that it was aimed at eradicating financial untouchability by providing bank accounts to the poor. On the inaugural day, a record 1.5 crore bank accounts were opened across the country, the largest such exercise on a single day possibly anywhere in the world.
Unveiling the scheme within 100 days of forming the new government, Modi said, it will cover 7.5 crore people by January 26, 2015, who will be provided zero-balance bank account with RuPay debit card, life insurance cover of Rs 30,000 in addition to accidental insurance cover of Rs 1 lakh. Later the account holders will be provided an overdraft facility of up to Rs 5,000. “If Mahatma Gandhi worked to remove social untouchability, if we want to get rid of poverty, then we have to first get rid of financial untouchability.
We have to connect every person with the financial system. And for that this programme has been given impetus,” he said, adding, “when a bank account is opened, it’s a step towards joining economic mainstream.” Modi recalled the bank nationalization of 1969 with the avowed objective of spreading the reach of financial system to the doorsteps of poor. “But I regret to say that after 68 years of independence, not even 68 per cent of population is covered by the banking system,” he said.
The scheme was simultaneously launched at multiple places by 20 chief ministers, several Union ministers, including information minister Prakash Javadekar at Pune, law minister Ravi Shankar Prasad at Chennai, external affairs minister Sushma Swaraj at Bhopal, home minister Rajnath Singh at Lucknow and HRD minister Smriti Irani at Surat. There were in all 600 programmes and 77,852 camps on the opening day to open bank accounts. Modi said history has been created in the banking system with opening of over 1.5 crore account in a day.
Besides, a record has been created by providing 1.5 crore accidental insurance covers of Rs 1 lakh. The Prime Minister described the occasion as a festival to celebrate the liberation of the poor from a poisonous cycle (“Vish-chakra se gareebon ki aazaadi ka parv”). “Banks have assured me they will do this work before January 26. Those who oppen accounts by January 26, 2015 over and above the the Rs 1 lakh accident, they will be given life insurance cover of Rs 30,000.
This will help the poor family,” he said. In the third phase, he said, these account holders would also be provided micro-pension facility. “I believe when a person opens a bank account then he or she takes the first step to get connected with the economic system. Today the 1.5 crore family who got connected with the economic system this will give a boost to the economy,” he said. Going forward, he can avail Rs 5,000 loan from the bank, the Prime Minister said, adding, this facility would be available after six months of opening of the bank account.
Expressing satisfaction at a number of records being broken today, the Prime Minister said the nationwide success of the enrolment drive today would give confidence not just to the officials of the department of financial services and banking sectors, but also to officers across the Union government, that they can successfully achieve the goals that they set for themselves. “Never before would insurance companies have issued 1.5 lakh accident insurance policies in a single day. Never before in economic history would 1.5 lakh bank accounts have been opened in a single day. “Never before has the government of India organized a programme of such scale — over 77,000 locations — with the participation of so many chief ministers, Union ministers, government and bank officials,” the Prime Minister said. -
Standard Chartered fined $300 million over money laundering controls
NEW YORK (TIP): New York state’s banking regulator hit Standard Chartered Bank with a $300 million fine and restrictions on its dollar-clearing business on Tuesday for not detecting possible money laundering. The New York Department of Financial Services (DFS) said the British bank’s internal compliance systems had failed to detect or act on a large number of “potentially high-risk transactions” mostly originating from Hong Kong and the United Arab Emirates.
The new punishment came two years after the bank paid US regulators $667 million to settle charges it violated US sanctions by handling thousands of money transactions involving Iran, Myanmar, Libya and Sudan. A DFS monitor appointed in 2012 to keep an eye on the bank discovered that it had not detected the allegedly high-risk transactions from Hong Kong and the UAE or reported them as it should have, the department said. “If a bank fails to live up to its commitments, there should be consequences.
That is particularly true in an area as serious as anti-moneylaundering compliance, which is vital to helping prevent terrorism and vile human rights abuses,” said DFS head Benjamin Lawsky. The department did not give any information on the nature of the transactions, or whether they proved to involve laundering or not. In a settlement agreed with the bank, DFS ordered Standard Chartered to halt dollar-clearing operations for unnamed “high-risk retail business clients” of its Hong Kong unit.
The bank is already cutting business with high-risk clients in UAE, but will also not be able to process dollar funds through the United States for them. Its New York branch also is forbidden to take on any clearing or deposit accounts from new customers without the approval of Lawsky’s office.‘Serious blow’
The fine would have a negative impact on the bank’s reputation and international business, independent financial analyst Francis Lun told AFP. “It’s really an oversight on the part of Standard Chartered. They’d already paid a huge penalty still they installed a system that is useless,” Lun said. “It will create tremendous problems with their international clients who cannot settle their accounts in US dollars.
It will be a serious blow to Standard Chartered group’s international business,” Lun said. Standard Chartered is based in London but has traditionally done most of its business in Asia and the Middle East. It said it accepted responsibility and “regrets the deficiencies in the antimoney laundering transaction surveillance system at its New York branch.” It added that it would work with clients in Hong Kong and UAE affected by the DFS requirements “to minimize disruption.” “The group remains fully committed to Hong Kong and the United Arab Emirates as key markets,” the bank said.
Hong Kong-listed shares in the bank fell 0.19 percent, to HK$157.8 ($20.36) in afternoon trade, while the Hang Seng Index remained flat. “$300 million isn’t a big number…investors will be fine with this penalty,” Tanrich Securities vice president Jackson Wong said. The action taken against Standard Chartered is part of an ongoing crackdown by New York state and federal authorities on banks, particularly foreign banks with New York branches, for handling money transfers from countries and individuals blacklisted by Washington for political reasons or for their involvement in criminal activities. -
MESSAGE
On the occasion of the 68th Independence Day of India, I congratulate the Indian community based in US and convey my greetings and best wishes to the readers of The Indian Panorama.It is an important occasion for us to remember those who sacrificed their lives for the Indian freedom take stock of our accomplishments and shortfalls and implement our vision of a peaceful and prosperous nation keen to play its role on the world stage.
Dnyaneshwar M. Mulay Consul General of India, New York
In the last 67 years, India has indeed come a long way and made its mark on the contemporary world. With its regular elections since 1952 and successful transfers of power, it has established an unmatched legacy as the largest democracy of the world. By achieving self-sufficiency in food production, increasing standard of living of people, providing health and education and creating social and economic infrastructure, the country has made great strides.
In our ever complex and increasingly challenging global environment, India with its strong heritage and equally strong capabilities has been playing an important role on the world stage. Whether it is peace keeping operations of the UN or technical assistance under its development partnership program (ITEC), India has never hesitated in assuming her responsibilities towards both international and regional partners.
In this endeavour, it has also been proactively cooperative with the major countries of the world and built strategic partnerships both at bilateral and multilateral levels. Vis-a-vis US, our relations are improving by leaps and bounds. Numerous joint working groups such as on nuclear cooperation, space cooperation, cyber security, counter-terrorism, science & technology, health and education are engaged in improving bilateral partnership.
Our trade relations have crossed $ 100 billion mark, mutual investment continues to grow rapidly, presence of Indian diaspora is creating new imprint and hundred thousand odd Indian students are laying the foundation of stronger relationship for the future. The Indian diaspora needs a special mention on this occasion.
Overcoming formidable multiple challenges, over 4 million people of Indian origin have already created a strong impression in the US. Their contributions in the fields of economic, culture, education, health and medical services, media and IT industry have been commendable. On this auspicious occasion, let us take a pledge to build a stronger partnership between India and US and also participate proactively in building a brighter future for our motherland, India.
Ashoke K Mukerji Permanent Representative of India to the United Nations
NEW JERSEY GENERAL ASSEMBLY UPENDRA J. CHIVUKULA
Iwould like to congratulate The Indian Panorama for bringing a special issue of The Indian Panorama on the occasion of the India’s 67th Independence Day. As an Indian American State Legislator in New jersey, I want to join you in recognizing the contributions of nearly 25 million nonresident Indians around the world and in particular, the growing impact the Indian Diaspora is having in North America on this occasion. I am quite hopeful that India under Prime Minister Modi’s leadership will rise to greater heights.
India has a great opportunity to be a world leader through its participation in promoting democratic principles. I take great pride of my heritage and my gratitude to mother India for giving the opportunity to get a decent education. I am also very happy that Indian economy has come a long way in economic development and its geo-political importance. As a New Jersey legislator, I am constantly looking for opportunities to promote trade between New Jersey and India. I would like to thank you for publishing articles on NRI issues, including NRIs’ contribution to India and various countries of their adoption.
NAVIN C. MEHTA. MD. FACS. FICS. PC. NEW YORK
It gives me great pleasure to know that region’s premier newspaper The Indian Panorama is bringing out an illustrated special issue to mark the 67th anniversary of India’s Independence. It is a thoughtful and appropriate attempt to focus on India’s struggles for freedom and subsequent struggle to strengthen roots of democracy and achieve the rightful place in comity of nations.
From an impoverished nation, where enough food grains were not available when India got her freedom in 1947, in 67 years she has grown in to a country which is self sufficient in food and aspires to compete with the developed world, projected to be one of the three major economic powers in the next few years. The 1.2 billion Indians are a strong work force, of which more than 35% are young. It is this human capital which combined with material wealth can put India in to number one position in the world.
I might just as well congratulate my Indian American friends for their singular contribution to this country and to their home country. They have built bridges between the to great democracies of the world, with the result that India and US enjoy a unique strategic partnership. The untiring effort of the Indian American community to preserve and promote the rich cultural heritage in an altogether different cultural milieu is indeed laudable and the institutions and individuals, including media which are involved in this gigantic task deserve to be remembered and appreciated on this occasion. I wish all Indian Americans a happy Independence Day and congratulate The Indian Panorama for bring out a commemorative issue.
Ashok Kumar Garg Chief Executive, US Operations Bank of Baroda, New York
Iam delighted to know that ‘The Indian Panorama’ is bringing out a special issue on the occasion of India’s Independence Day on 15th August 2014. On behalf of Bank of Baroda, I extend warm greetings to one and all Indians in America. The Independence gained 67 years ago from the British Empire did more than just establish a new nation.
It endeavored to bring freedom and opportunity to the common man; to the peasants and workers of India; to fight and end poverty and ignorance and disease; to build up a prosperous, democratic and progressive nation, and to create social, economic and political institutions which will ensure justice and fullness of life to every man and woman. Indo – US bilateral relationship is now poised to achieve great heights of mutual benefit to both the nations.
The Indian diaspora in USA has become an integral part of the multi cultural identity of this great country and continue to uphold and preserve the ethical values, tradition and the principles of democracy. Bank of Baroda is honored to join in the Indian Independence Day celebrations and exhort all, to come together in combining with the spirit of America to achieve dreams and aspirations of the citizens of both countries.
In this great land of opportunities, where ideas are accepted and allowed to fructify, let us pledge to make other’s life comfortable. I once again convey the greetings and best wishes from Bank of Baroda to the readers of Indian Panorama on this auspicious and happy occasion.
Pramoda Kumar Pattanaik Chief Executive Bank of India, US Operation
It gives me great pleasure to know that region’s premier newspaper “The Indian Panorama “is bringing out an illustrated special issue to mark the 67th anniversary of India’s Independence. It is a thoughtful and appropriate attempt to remember the supreme sacrifice to achieve freedom and subsequent struggle to strengthen the roots of democracy and achieve the rightful place in comity of nations.
In the last 67 years after independence, it has come a long way surpassing many hurdles, challenges and crisis and now forging ahead to compete with the developed world, projected to be one of the three major economic powers in the next few years. With more than 1.2 billion of people, it is now the largest democracy in the world. Rich demographic dividend in the form of younger population will now be our prime trigger for growth.
Coupled with this, India’s bourgeoning middle class, tech savvy, skilled, educated and English speaking youths are adding to its strength to make it a force to reckon with. We, at Bank of India, are contributing our bit to accelerate the process of India becoming an economic superpower. I wish all Indian Americans a happy Independence Day and congratulate “The Indian Panorama” for bring out a commemorative issue.
Saleem Iqbal President & CEO HAB BANK, New York
On behalf of HAB BANK, I would like to extend our Independence Day greetings to Indian American community in the tri-state area. As we celebrate India’s Independence sixty eights years ago, we can take pride in our achievements as a community in the U.S. despite the challenges that lie ahead. We have, in a short span of time, been able to establish ourselves as a vibrant community engaged at so many levels, culturally and economically, and determined to pursue our American dream of achieving success in our adopted homeland.
HAB BANK, since is inception in 1983 as a New York State chartered bank, has played a vital role in nurturing communities through its network of branches in New York, New Jersey, and California. We are proud to be the first bank in the U.S. solely focused on meeting and serving the banking needs of South Asian community.
We take this opportunity to express our gratitude to Indian American community for their unwavering support since our inception. We are honored to join in celebrating India’s Independence Day celebration and reaffirm our Bank’s commitment to South Asian community in the U.S. -
Jan Dhan scheme to help poor open bank accounts: PM
NEW DELHI (TIP):
Prime Minister Narendra Modi on August 15 launched ‘Pradhan Mantri Jan Dhan Yojana’ to help the poor open bank accounts which will come with the facility of a debit card and an insurance cover of Rs 1 lakh. “We want to integrate the poorest of the poor with bank accounts with Pradhan Mantri Jan Dhan Yojana,” he said in his maiden Independence Day address to the nation. Observing that people have mobile phones but not bank accounts, Modi said, the scheme will help in bringing the benefits of formal banking system to them.
“Today there are crores of families which have mobile phones but no bank accounts. We have to change this. The economic development must benefit poor and it should start from here,” he said. Under the Jan Dhan Yojana, he said, “the person who will open bank account will get a debit card and the family will get Rs. 1 lakh insurance cover. This will help the family to tide over the unforeseen eventuality.”
The Union Cabinet has already cleared the two-phase financial inclusion scheme under which bank accounts will be opened for 15 crore poor persons with an overdraft facility of Rs 5,000 and accident insurance of Rs. 1 lakh. The scheme, to be pushed by the government in a mission mode, seeks to provide two accounts to 7.5 crore identified households by August 2018.
The main features of the scheme include Rs. 5,000 overdraft facility for Aadhar—linked accounts, Ru Pay Debit Card with inbuilt Rs. 1 lakh accident insurance cover and minimum monthly renumeration of Rs. 5,000 to business correspondents who will provide the last link between the account holders and the bank.Caste, communal violence stalls progress, says Modi
Modi asked the nation to eschew caste or communal violence as stalled the growth of the nation. “Let us affirm that we will be free from these tensions,” Narendra Modi said. Earlier, he had arrived at the Red Fort and hoisted the National Flag from there. In the course of his speech, he tried to address a wide-range of issues before the nation.
-
TATA GROUP IS INDIA’S MOST VALUABLE BRAND: STUDY
NEW DELHI (TIP): The Tata group has retained its place as the country’s most valuable brand at $21 billion, while the total worth of top-100 Indian brands now stands at $92.6 billion, says a new study. State-run insurance behemoth LIC is ranked second with a brand value of$4.1 billion, followed by public sector bank SBI ($4 billion), Bharti Airtel ($3.8 billion) and Reliance ($3.5 billion).
The brand value of Tata group has risen by $3 billion in the past one year, primarily led by its international diversification strategy and the flagship firm TCS, as per consulting firm Brand Finance India’s annual study. “Despite the fact that some divisions within the group have been underperforming, the brand should benefit from the recently outlined plans to invest$35 billion over the next three years and should go some way towards meeting the goal of the Tata chairman, Cyrus Mistry to be amongst the 25 most admired brands globally,” it said.
Brand value has increased among the top 50 by 10 per cent compared to 2013 with brands such as Tata, Godrej, HCL, and L&T leading the way, said the Brand Finance India 100 list that was released on August 7. Banking firms fared the worst collectively with majority of brands losing value or remaining stagnant due to generally poor governance and weak credit controls especially at the government-owned institutions, Brand Finance said.
State Bank of India has seen its value drop by ($1.9 billion) as poorer revenue forecasts and bad-loans dampened earnings, it said. HCL Technologies has seen an increase in brand value of 51 per cent by$649 million as its successful strategy has seen the brand win 50 transformational engagements with contract values of$5 billion in the past year distributed across all service lines and geographies.
“Indian brands have benefited from the rapid economic growth seen over the past ten years,” said Brand Finance’s Savio D’Souza. “Indian brands must take advantage of the improving business sentiment and invest in brand related activities like customer engagement, sponsorships, employee satisfaction and brand tracking to drive the next phase of growth in order for more Indian companies to join the global club of internationally recognised brands,” he added. The average brand value to enterprise value (BV/EV) for India’s top 100 brands is 12 per cent. However, some of the largest PSUs have an average ratio of 3 per cent. The BV/EV ratio shows the proportion of a company’s value accounted for by the brand. -
Mundra takes charge as RBI deputy governor
MUMBAI (TIP): Reserve Bank of India’s new deputy governor S S Mundra has been given charge of banking supervision, currency management, financial stability and July 30 notified his appointment for a period of three years. Prior to taking charge Mundra was chairman of Bank of Baroda, the country’s second large bank. He had begun his career as a probationary officer in Bank of Baroda in March 1977.
During a banking career he held various positions including heading the bank’s European operations (UK) before being elevated as Executive Director of Union Bank of India in September 2010 and further as Chairman of Bank of Baroda in January 2013. The position of deputy governor had fallen vacant in March after former deputy governor KC Chakrabarty put in his papers three months before his term ended. He played a key role in financial inclusion as head of the committee on financial inclusion set up by the Indian Banks’ Association (IBA) and also served as a member of several other important committees relating to the banking and financial sector constituted by the IBA and RBI, including the Nachiket Mor Committee on Comprehensive Financial Services (CCFS) for small businesses and lowincome households. -
BUDGET A VALIDATION OF UPA POLICIES: CHIDAMBARAM
NEW DELHI (TIP): Former finance minister P Chidambaram, who presented the interim budget ahead of the Lok Sabha polls, has said he is happy to find the BJP government’s first Budget validating the figures presented by him. “The imprint of the UPA government’s policies can be found throughout the Budget speech and in the budget documents,” Chidambaram said in a statement. He said it’s not possible to come out with a “Congress- Mukt Budget”.
“Welcome to the real world… BJP sought a mandate for Congress-Mukt Bharat.My friend, Arun Jaitley, would have realised that it is not possible to have even a Congress- Mukt Budget,” the former finance minister said. He said Arun Jaitley’s Budget has the imprint of UPA policies on fiscal consolidation, GST, FDI cap in insurance and social sector schemes. “I am glad that Arun Jaitley has acknowledged the basic validity of the numbers presented in the Interim Budget for 2014-15 and has stuck to them…He has also maintained the tax revenue estimates for Corporation Tax, Customs and Service Tax,” he said. Chidambaram referred to the numbers with regard to the fiscal deficit at 4.1% and revenue deficit of 2.9% (marginally lower than 3%).
Mamata: Budget visionless
KOLKATA: Chief minister Mamata Banerjee came down heavily on the NDA for what she called a ‘visionless, missionless and actionless’ budget as far as the common man is concerned. According to her, the first Union Budget tabled by the Narendra Modi government can’t stimulate growth or lead to development of the poor. “We heard about a strong and vibrant India before the government came to power.
We thought that it will be delivered to provide good governance. But from the beginning, we are getting disappointed. Only one positive sign of the new government is established in two budgets that they have become a government of the FDI, by the FDI and for the FDI. Already, there is FDI in the retail. Now FDI is increased to 49% in Defence, and Insurance Sectors. In addition, disinvestment in banking sector is up to 49%. -
Indian-American Coalition endorses Rep. Jim Himes for Re-election
NEW YORK (TIP): Citing Rep Jim Himes’ support of the Indian American community and his dedication to the legislative issues at the Capital, a group of Indian Americans joined together to host a reception and fundraiser at the Hampton Inn and Suites in Stamford on June 26th evening.
At a well attended program, Himes thanked the gathering and took several questions from the audience which included the new immigration reform which is under consideration, job creation in Connecticut and banking issues. Early this month, GOPIO-CT, one of the community groups in Connecticut, honored Rep. Himes as Friend of India at its annual awards banquet.
“Congressman Himes is in two important House Committees, Financial Services and Permanent Select committee on Intelligence and we want him there,” said Dr. Thomas Abraham, who co-hosted the event. “I think if he continues to do so, it will benefit our country and Connecticut” Dr. Abraham added. Viresh Sharma, who is a registered Republican from New Canaan, has said that he supports Himes for his work in Washington DC and his record for the last six years. Over a dozen people served as cohosts and supporters for the event which raised funds for Himes’s reelection bid.
-
Saleem Iqbal President & CEO HAB BANK, New York
On behalf of HAB BANK, I would like to extend Independence Day greetings to our community in the tri-state area. As we celebrate Independence Day this year, we can take pride in our achievements as a community despite the challenges that lie ahead. We have, in a short span of time, been able to establish ourselves as a community engaged at so many levels, culturally and economically, and determined to pursue our American dream of achieving success in our adopted homeland. Our South Asian community has become part and parcel of our great country and collectively, we will continue to uphold and preserve American values and tradition of democracy in the years to come.
HAB BANK, since is inception in 1983 as a New York State chartered bank, has played a vital role in nurturing communities through its network of branches in New York, New Jersey, and California. We are proud to be first bank in the U.S. solely focused on meeting and serving the banking needs of South Asian community working and living in the Tri-State and greater Los Angeles areas. We are honored to join in celebrating our Nation’s birthday. May we come together in the enduring spirit of America to achieve our dreams and aspirations.! I wish you all the best for a happy Fourth of July. May God Bless all those who serve, and may God Bless the United States of America!
-
Sebi bid to boost retail participation
MUMBAI (TIP): In an attempt to increase retail participation in the capital markets, the Securities and Exchange Board of India (SEBI) has brought a host of changes that include a 10 % reservation for retail investors in an offer for sale (OFS) and permission for buying of shares for employee stock option schemes from the secondary market. OFS is akin to selling shares on the bourses through auction. The stock exchanges would offer a separate window for such share sales that are open during normal trading hours. The Sebi board after a meeting on Thursday said that a minimum 10% of the issue size should be reserved for retail investors i.e. investors bidding for amounts less than Rs 2 lakh under OFS.
“In case this percentage is not fully utilized, the unutilized portion may be offered to other investors,” it said. This is being done to encourage retail participation in OFS and enable all large shareholders including nonpromoter shareholders to use the OFS mechanism, Sebi said. The OFS mechanism would be made available for shareholders of top-200 companies by market capitalisation. Until now the OFS route was restricted to top-100 companies. “Non-promoter shareholders having shareholding of more than 10% or such percentage as specified by Sebi from time to time shall be eligible to use OFS.”
This move paves the way for the government to divest its residual stake in Hindustan Zinc Ltd. The Cabinet had in January cleared the selling of the residual stake in HZL. As for Employee stock option schemes and employee stock purchase schemes, Sebi said companies would be permitted to acquire shares from the secondary market under certain conditions to avoid forced dilution of capital. The move is in line with international practices but would require shareholders’ approval through special resolution.
The regulator has put in place safeguards that include at least a six month holding period for shares acquired from the secondary market. Besides, SEBI has also said that the minimum dilution to the public in an initial public offer (IPO) should be 25% or Rs. 400 crore, whichever is lower, for companies with post-capitalisation of less than Rs. 4000 crore.
“This will remove the anomaly that a company just short of Rs 4000 crore market capitalisation, was required to dilute about Rs. 1000 crore while another company at Rs. 4000 crore market capitalisation was required to dilute only Rs. 400 crore,” Sebi said. Companies with a post-capitalisation of above Rs. 4000 crore are required to dilute only 10% in an IPO. “Though much more needs to be done to bring the retail investors back, if good large companies make an IPO by diluting 10% but at reasonable valuations, it will be attractive for retail investors,” said Dara J Kalyaniwala, vice president—investment banking, PL Capital Markets.
-
COUNTRY’S FIRST PAYMENT BANK TO COME UP SOON: RBI
MUMBAI (TIP): Reserve Bank of India has said that the country will soon have its first payment bank as prescribed by a committee headed by Nachiket Mor to look into financial inclusion. Speaking at a BFSI Conference organized by SBI Capial Markets, HR Khan, deputy governor, RBI said, “I know that many are disappointed that RBI has issued only two universal bank licences.
But we will soon be coming out with new guidelines and the licencing will not be a window where everyone will have to rush at the same time,” said Khan. “We will shortly be coming out with a payment bank which has been recommended by the Nachiket Mor committee,” said Khan. He added that besides guidelines for a universal bank, RBI will have separate norms for small banks along with midsized commercial banks.
A payment bank, as envisaged by the Mor Committee, will provide transactional services like opening an account, allowing payments and remittances. However, it will not extend loans and invest the deposits in government securities. The objective of such a bank is to extend primary banking services to the hitherto unbanked. There have been reports that IndiaPost, one of the aspirants for a bank licence, would be granted a payments bank licence. There were 26 aspirants in all for a bank licence of which only two – IDFC and Bandhan were successful.
-
RBI MOVES AWAY FROM SECTOR-SPECIFIC REFINANCE
MUMBAI (TIP)The Reserve Bank of India (RBI), decided to limit access to export credit refinance while compensating fully with a commensurate expansion of the market’s access to liquidity through a special term repo facility from the central bank (equivalent to 0.25 per cent).
It reduced the liquidity provided under the export credit refinance (ECR) facility from 50 per cent of eligible export credit outstanding to 32 per cent with immediate effect, while introducing a special term repo facility of 0.25 per cent “to compensate fully for the reduction in access to liquidity under the ECR with immediate effect.’’
The RBI said that this was “in pursuance of the Dr. Urjit R. Patel Committee’s recommendation to move away from sector-specific refinance towards a more generalised provision of system liquidity without preferential access to any particular sector or entity.” “This should improve access to liquidity from the Reserve Bank for the system as a whole without the procedural formalities relating to documentary evidence, authorisation and verification associated with the ECR.
This should also improve the transmission of policy impulses across the interest rate spectrum and engender efficiency in cash/treasury management,” it added. The RBI also decided to continue to provide liquidity under 7-day and 14-day term repos of up to 0.75 per cent of the banking system. This measure will continue to provide liquidity in the banking system.
With a view to improving the depth and liquidity in the domestic foreign exchange market, the RBI will now allow foreign portfolio investors to participate in the domestic exchange traded currency derivatives market to the extent of their underlying exposures plus an additional $10 million. Furthermore, it also decided to allow domestic entities similar access to the exchange traded currency derivatives market.
Also, in view of the recent stability in the foreign exchange market, it was decided to enhance the eligible limit for foreign exchange remittances under the liberalised remittance scheme (LRS) to $125,000 without end use restrictions except for prohibited foreign exchange transactions such as margin trading, lottery and the like. Earlier, as a prudential measure, the RBI had reduced it to $75,000 last year.
In order to facilitate travel requirements of non-residents visiting India, the RBI decided to allow all residents and non-residents except citizens of Pakistan and Bangladesh to take out Indian currency notes up to Rs.25,000 while leaving the country. At present, only Indian residents are allowed to take Indian currency notes up to Rs.10,000 out of the country and non-residents visiting India are not permitted to carry any Indian currency notes while leaving the country
-
Top Senator proposes first 100 days action plan for India-US
WASHINGTON (TIP): A powerful American Senator has proposed “100 days action plan” for the Modi government and the Obama administration to “refresh” the India-US relations. Senator Mark Warner, who is the Democratic co-chair of the Senate India Caucus, has suggested the Modi government to modify the defense-offset regime, agreeing to build community colleges in India, lifting the foreign direct investment caps in some of the sectors, and announcing a new electronic payment systems.
In the first 100 days of the Modi government, Waren has proposed to the Obama administration to name a senior official for defense trade, review tourist visa policies and access to high skill visas. Among other action plans for the first 100 days, he has advised the Modi government and the Obama administration to announce a joint energy project, convene a meeting of India-US strategic dialogue, hold bilateral talks on Afghanistan, restart negotiations to achieve a bilateral investment treaty (BIT), re-launch the defense policy group, and establish a publicprivate working group on infrastructure investment.
“I believe we have an opportunity, in the early days of the new Indian administration, to refresh the US-India relationship and work cooperatively to make progress that will benefit both of our countries,” Warner said in a fourpage 100-days action plan. As a co-chair of the US Senate India Caucus for several years,Warner has been working with US and Indian government officials and business leaders to address important issues for both countries, including education, skills development, infrastructure and energy.
“However, over the last 18-24 months, the relationship lacked a catalyst.With this month’s historic Indian election, we can harness the enthusiasm of the Indian people to boost our partnership. “We can use the first 100 days to move from dialogue to action and build a path forward for more ambitious cooperation,” he said. “There are many areas where a partnership between our countries would serve goals on both sides, and if the respective administrations choose just two or three deliverables to shoot for in the first 100 days, we could provide the business community on both sides a new optimism that we can work together and get things done,” Warner added.
In his action plan,Warner has proposed that the India-US Strategic Dialogue this year be held in New Delhi, instead of Washington DC as originally scheduled. “Since the new Indian government will just be getting started, holding the Dialogue in Delhi will be less disruptive to organizing meetings and will provide both sides the opportunity to meet and get to work early in the term on joint initiatives,” he said. India and the US have meandered through several rounds of stop and start negotiations about how to proceed with BIT, he said.
“Announcing that both sides will sit down and negotiate a framework would boost confidence that a BIT is possible. A BIT would provide important protections for investors, help unleash needed investment, and provide a level playing field for both countries,” he added. The Obama administration, he said, should name a senior-level official who reports directly to the secretary of defense to lead the defense trade and technology Initiative.
“Under Ash Carter’s leadership this was one of the most successful programs and helped shepherd billions of dollars of defense deals through the pipeline as well as clearing out inefficiencies on both sides of the US-India defense trade to make defense trade simpler, more responsive, and more effective,” Warner said. Warner said the US should conduct a review of visa policies with an eye toward further opening of global entry and trusted traveler programs for frequent travelers, including business leaders and investors.
“A review of policies for high-skill employees would help ensure companies in both countries have access to talent to help US companies and the American economy grow and innovate and encourage more joint research and cooperation between universities,” he said. An agreement to increase travel and tourism between the two countries would increase more people to people interaction, he argued. For the Modi government, he said lifting FDI caps in some of the sectors that have been under discussion for years would be a positive signal to foreign firms that India was again “open for business.”
Specifically, defense, insurance, railways, e-commerce and banking sectors are ripe for reform, he said. Warner said India and the United States share a unique bilateral relationship. “As the world’s oldest and largest democracies there are many areas in which our strategic interests combine, and when we find ways to cooperate and work together both of our countries benefit,” he said. “The historic and sweeping election that has made Narendra Modi Prime Minister of India is a testament to a thriving democracy and a signal that the people of India are ready for economic growth and productivity,” he added.
-
Austerity blame-game dominates EU candidates’ debate
BRUSSELS (TIP): The five top candidates to head the European Commission swapped accusations on Thursday over the impact of Europe’s austerity measures and the role played by banks in sparking the economic and financial crisis. In an often heated debate in Brussels, several candidates were forced onto the backfoot by Greek radical-left leader Alex Tsipras, who wasted no time in denouncing “catastrophic austerity policies” and demanding an exit from “debt paranoia”.
Conservative leader Jean-Claude Juncker, the former prime minister of Luxembourg who headed the single-currency Eurogroup for eight years, pounced on Tsipras’s remarks, rejecting the suggestion he had not acted in the best interests of Greece. “I worked for years, day and night, to prevent Greece leaving the eurozone,” Juncker said, adding that he had done everything in his power to help the ailing country while endeavouring to get its public finances in order.
Guy Verhofstadt, the candidate from the centre-right liberal grouping ALDE, mocked Tsipras’s suggestion that banks and EU banking policies were to blame for southern Europe’s economic woes. “In Greece, in Italy, it wasn’t a matter of banking, but bad policies on the part of your political parties,” Verhofstadt told Tsipras, defending the need for fiscal discipline in the EU as it struggles to move out of recession.
“You need fiscal discipline, otherwise you cannot have growth… and that means making no new debt,” Verhofstadt said, adding that the best way forward was to make the most of the EU’s common market by removing economic barriers within the 28-member bloc. Greens leader Ska Keller, the only woman in the race to become the next president of the European Commission, said that more austerity in the EU would “worsen the situation”, but called on member states to do more to invest in “sustainable jobs” in renewable energy.
Socialist leader Martin Schulz, the outgoing president of the European Parliament, agreed the EU had made a mistake in “unilaterally cutting” spending, but pointed to the fight against tax fraud and tax evasion as the best way of providing relief to state coffers. The debate was the first of its kind to include all five parties in the running for the Commission presidency, which is the highest executive position in the EU.
In a break from earlier formats, three of the candidates spoke English, while Juncker chose French and Tsipras used Greek. The event, broadcast from the European Parliament building in Brussels by 50 TV stations and a variety of radio stations and websites across Europe, was moderated in English by an Italian journalist. With 10 days left in the European parliamentary election campaign, all eyes had been on Tsipras, the former communist who had previously eschewed public debates.
– Call for a common immigration policy –
One of the only two moments of policy agreement in the debate came when discussing the EU’s policy setting on asylumseekers, following another shipwreck off the coasts of Italy this week which claimed 17 lives. Verhofstadt, a former Belgian prime minister, said that part of the problem was the EU’s lack of a common legal immigration policy, which in turn exacerbated the problem of illegal arrivals.
Tsipras argued it was “unacceptable… to allow the Mediterranean to turn into a graveyard”, saying Europe needed to become “synonymous with solidarity”. Keller called the absence of a coordinated immigration policy a “scandal”, while Juncker agreed that the time had come for “a European law dealing with migration”, urging EU members not to cut their aid budgets to better assist people before they undertook the perilous journey across the Mediterranean.
The candidates also concurred on the responsibility on the part of EU member states to appoint one of them, as the leaders of political groupings in the European Parliament, to replace current Commission President Jose Manuel Barroso after the May 22-25 poll. Under new rules, member states are required to “take into account” the results of parliamentary elections in appointing the new Commission chief. However, it remains unclear whether that amounts to a legal obligation to appoint party leaders.
“It is finished the idea that the Commission president would be the result of a backroom deal — this is finished,” Schulz said. “If they really dare to nominate another (candidate), the answer is quite clear: you will get no majority in the European Parliament.” Juncker agreed, saying that to not appoint a party leader would be a “denial of democracy” and would imply that European citizens no longer mattered in the EU.
-
L&T Finance keeps its banking hopes alive
MUMBAI (TIP): L&T Finance Holdings (L&TFH) on Wednesday said that the company would look for the next opportunity to get into banking and would wait for the RBI guidelines before moving ahead. N Sivaraman, president and whole-time director at L&TFH, said while the company was disappointed at not getting a bank licence it would wait for the next opportunity as and when it comes. “We have to get the discussion around the licences guidelines, which RBI is going to follow. That needs to be understood before embarking on any other initiative.
There are opportunities available but at the moment we would wait for RBI to come up with guidelines. Everything else is speculation,” said Sivaraman. The consolidated profit after tax of L&TFH (excluding exceptional items) was hit by higher provision costs. For FY14, the consolidated profit after tax grew 7% to Rs 597 crore from Rs 558 crore last year. Consolidated PAT for the quarter stood at 187 crore, again up 7% from Rs 175 crore last year.
“Provisions had an impact on profit growth. Our gross non-performing assets have increased from 2.29% of loans to 3.18%,” said Sivaraman. He attributed the rise in bad loans to a ‘tight economic environment’. According to Sivaraman, a stable government with good investment philosophy would boost the economy and improve prospects for the company. The NPAs are in accounts of corporates who are developers for infrastructure projects.
Defaults were also high in the construction and commercial vehicle segments. When asked about fresh investments, Sivaraman said that the company was focused on its existing business and was not looking at putting capital in any new activity. “Given the challenging environment, we continue to focus on building a quality portfolio by being cautious in credit selection and containing credit costs on our existing assets through aggressive asset monitoring. We expect to maintain an overall book growth at 15% to 20%,” he said.
-
Xoom Announces Instant Deposit Service to HDFC Bank Accounts in India
SAN FRANCISCO, CA (TIP): Xoom Corporation (NASDAQ: XOOM), a leading digital money transfer provider, announced, March 31, a partnership with HDFC Bank Limited (NYSE: HDB), by offering instant deposits to INR denominated HDFC Bank accounts in India. This breakthrough service allows Xoom customers to instantly deposit money directly into their recipients’ HDFC Bank accounts in India. The instant service is available 24 hours a day, seven days a week, 365 days a year–even on banking holidays.
“Unlike other transfer services to India which typically take five days or more, Xoom is relentlessly working towards providing ‘instant’ for all of our services, and we are excited to launch instant deposits to HDFC Bank,” said Julian King, Senior Vice President of Marketing and Corporate Development for Xoom. “This is great news for people who send money to HDFC Bank accounts. Now NRIs can send money anytime, anywhere from their computer, mobile phone or tablet and their bank deposits reach their recipients’ HDFC Bank account instantly.”
“At HDFC Bank, we are consistently looking at new ways in which we can make a difference in the lives of our customers. Through this tie-up with Xoom we will be able to provide this breakthrough service of instant deposits,” says Mr. Rajender Sehgal, Group Head, Financial Institutions Group, HDFC Bank. “We look forward to bringing a whole new world of convenience and flexibility to our account holders, allowing them to receive money from the US in a secure manner, at any time of the day or night. Xoom provides great locked-in exchange rates for money transfers to India, and there is no fee when customers send more than $1,000 and pay with their U.S.-based bank account. Plus, Xoom continues to provide fast bank deposits within four hours to all other banks in India, including to NRE and NRO accounts, when sent during bank processing hours in India. Customers can also download the Xoom App for Android and iOS mobile devices for free. Visit https://www.xoom.com/india for more information.
About Xoom
Xoom is a leading digital money transfer provider in 31 countries, focused on helping consumers send money in a secure, fast and costeffective way using their mobile phone, tablet or computer. During the year ended December 31, 2013, Xoom’s more than one million active customers sent more than $5.5 billion to family and friends. The company is headquartered in San Francisco and can be found online at www.xoom.com.About HDFC
Promoted in 1995 by Housing Development Finance Corporation (HDFC), India’s leading housing finance company, HDFC Bank is one of India’s premier banks providing a wide range of financial products and services to its 28.5 million customers across hundreds of Indian cities using multiple distribution channels including a pan-India network of branches, ATMs, phone banking, net banking and mobile banking. Within a relatively short span of time, the Bank has emerged as a leading player in retail banking, wholesale banking, and treasury operations, its three principal business segments.The Bank’s competitive strength clearly lies in the use of technology and the ability to deliver worldclass service with rapid response time. Over the last 19 years, the Bank has successfully gained market share in its target customer franchises while maintaining healthy profitability and asset quality. As of December 31, 2013, the Bank had a distribution network with 3,336 branches and 11,473 ATMs in 2,104 cities/towns. For the quarter ended December 31, 2013, the Bank’s total income was INR 127.39 billion (`12,739.0 crore) as against INR 108.18 billion (`10,818.1 crore) for the quarter ended December 31, 2012.
Net revenues (net interest income plus other income) were INR 67.83 billion (`6,783.1 crore) for the quarter ended December 31, 2013, as against INR 59.09 billion (`5,909.4 crore) for the corresponding quarter of the previous year. Net Profit for the quarter ended December 31, 2013, was INR 23.25 billion (`2,235.7 crore), up by 25.1% over the corresponding quarter ended December 31, 2012. Total income for the year ended March 31, 2013, was INR 419.175 billion (`41,917.5 crore). Leading Indian and international publications have recognized the Bank for its performance and quality. For more information please log on to: www.hdfcbank.com
-
NEW BANKING LICENCES LIKELY TO WIDEN FINANCIAL INCLUSION PROCESS
MUMBAI (TIP):
The new banking licences issued to IDFC and Bandhan Financial Services Private Limited and the Reserve Bank’s intention to consider the application of Department of Posts separately in consultation with the Central Government are likely to widen the scope for financial inclusion. “It was a long process and the RBI has done a careful evaluation, using all filters, quantitative and qualitative, while selecting the entities for banking licences,” said Shashwat Sharma, Partner-Financial Services, KPMG in India.The RBI was convinced that these entities would be able to do justice to the central bank’s declared slogan ‘financial inclusion’, he pointed out. “While the RBI has been conservative in granting in-principle approval to only two applicants in this round, what is very heartening to note is the stated outlook to review the guidelines and make this a regular process moving towards an ‘on-tap’ policy, including differentiated licences,” said Mr. Sharma. The new banks added in 1993-94 were only obligated to open branches in rural areas. The banks added subsequently in 2003-04 were required to have 25 per cent branches in semi-urban and rural locations.
The current guidelines require new banks to set up 25 per cent branches in un-banked rural locations with population up to 9,999. “If we carefully look at the developments in the two decades, this clearly indicates the focus RBI is having towards inclusive growth and financial inclusion,” said Rishi Gupta, COO & ED, FINO PayTech, the largest business correspondent in India offering a bouquet of financial services. “Bandhan is well-established in rural parts of Eastern India. It essentially caters to the “entrepreneurial / bankable” masses by extending them credit via joint liability group (JLG) model.
Whereas other typical corporate banks find it difficult to make rural branches profitable, Bandhan should be able to leverage its rural presence effectively, said Gupta. “What needs to be seen is how it is able to cater to the banking needs of the BPL sections of rural India,” he added.
Emerging competition
“We believe new entrants will take time to scale up their branch and liability networks and will not pose significant threat to the strong deposit/retail franchises created by other larger banks,” said Hatim Broachwala, Analyst, Karvy Stock Broking, while talking on newly emerging competition in the sector. The RBI has also reiterated that the new bank licences will be an on-tap process from here on. and guidelines for the same will be issued soon. Mr. Broachwala said that the process of gradual entry of banks over a period of time would smoothen out future competition in the sector and also reduce risks of failure of new banks.“We have a strong starting position in corporate banking. As a bank, we will be able to deliver to our existing clients wider array of products. That should reduce our dependency on term loans and allows us to broaden our revenue base from corporate banking. In parallel, it is our goal to build a depository franchise, which we intend also to enter the space of retail banking… to reach the goal of an universal bank,” said Rajiv B. Lall, Executive Chairman, IDFC. “We will also have a particular focus on building up banking footprints in Bharat….going to smaller towns and reach the unbanked,” Lall added.
-
CBI BOOKS 6 COMPANIES FOR LOAN DEFAULTS
NEW DELHI (TIP): The Central Bureau of Investigation (CBI) has registered 10 FIRs against six companies for allegedly defaulting on loans from state-run banks. The companies against whom the agency has filed FIRs include Deccan Chronicle Holdings (DCHL), Zoom Developers, Pixion Media, Century Communications, Rajat Pharma Chem and STCL.
The CBI has also registered FIRs against some public servants to probe the conspiracy aspect. The agency is expected to include some more “big names” in the days ahead as several preliminary enquiries have also been registered, sources said. CBI is also probing the role of banks in restructuring of loans. Efforts to reach DCHL and some of the other companies for comments, which are named in CBI’s FIRs, did not yield results.
The finance ministry and RBI have expressed concern over spiralling of bad loans in the banking sector. Finance minister P Chidambaram has said willful defaulters would be sternly dealt with. Indian banks, led by the public sector, have accumulated sticky loans of over Rs 6.5 lakh crore till the end of 2013. Construction, infrastructure, steel and textile companies are the top defaulters.
The country’s largest lender, State Bank of India, also tops in bad loans, followed by Punjab National Bank and Central Bank of India. The CBI last year began verification of nonperforming assets of banks and thousands of documents were verified by the Bank Securities & Fraud Cell of the agency with the help of financial experts. Sources say that among the 10 FIRs registered, five have been filed against Rajat Pharma.
The company has outstanding loans of Rs 361 crore with several banks, CBI sources said. The FIR against Zoom Developers says the company has an outstanding of Rs 2,002 crore. Several banks and financial institutions have threatened to auction properties of the group in Mumbai and Indore. DCHL has an outstanding of Rs 1,180 crore, repayable to the banks, CBI sources said. Another major defaulter is STCL, the company which is in the process of winding up. It has an outstanding loan of Rs 1,529 crore, according to the CBI’s FIR. “We will register more FIRs in coming weeks,” said a senior CBI officer, adding that the agency was looking into several other companies.
The CBI has sought documents from the companies, banks which have given loans and the ministry of finance. The agency’s probe also focuses on the role of banks, as several banks did not file complaints with the authorities despite pending loans for years, CBI source said. CBI director Ranjit Sinha, during a recent conference of vigilance officers, had drawn their attention to the problem of bad loans in the banking sector. “A bulk of NPAs is from the top 30 accounts, which is learnt to be running into thousands of crores,” Sinha had said.
“At times, there appears to be reluctance on the part of banks to declare bad accounts as frauds despite there being clear-cut manifestations. There is a need to realize that the delay in reporting of a fraud will adversely affect the tracking and recovery of proceeds of crime. Another issue is the fixing of accountability of staff and there are often differences of opinion between the CBI and banks regarding the role of public servants,” Sinha had said.
-
Seminar on Banking & Taxation
NEW YORK (TIP): New York seniors held a seminar on Banking and Taxation on Wednesday, February 26 at Panchmukhi Hanuman Temple, Glen Oaks. Shashikant Patel briefly explained about NRE, NRO, FCNRE accounts, updated tax deduction rules and filing tax returns.
Gopi Udeshi covered Banking safety at ATM, online banking, direct deposits as well recurring payments from bank accounts and safe deposit rules in India and USA, importance of living will and beneficiary name. Well known CPA/Tax Auditor Mr. Dwarka Kalantry spoke about Tax planning for seniors.
-
US attorney probes Mt. Gox, bitcoin businesses
NEW YORK (TIP): Manhattan attorney Preet Bharara has sent subpoenas to Mt. Gox, other bitcoin exchanges, and businesses that deal in bitcoin to seek information on how they handled recent cyber attacks, a source familiar with the probe said on Wednesday.
In the attacks — known as distributed denial of service attacks — hackers overwhelmed bitcoin exchanges by sending thousands of phantom transactions. At least three exchanges were forced to halt withdrawals of bitcoins on February 7, including Mt. Gox, which was the largest at the time. Mt. Gox never resumed service before going dormant on Tuesday, leaving customers unable to recover their funds.
The Tokyobased company’s chief executive, Mark Karpeles, said earlier on Wednesday that he is working with others to solve the problems. “As there is a lot of speculation regarding Mt Gox and its future, I would like to use this opportunity to reassure everyone that I am still in Japan, and working very hard with the support of different parties to find a solution to our recent issues,” Karpeles said in a statement posted on the Mt. Gox website.
A spokesman for Bharara declined to comment. Bitcoin, a form of electronic money independent of traditional banking, relies on a network of computers that solve complex mathematical problems as part of a process that verifies and permanently records the details of every bitcoin transaction that is made. At current prices, the bitcoin market is worth about $7 billion. Investors deposit their bitcoins in digital wallets at specific exchanges, so the Mt. Gox shutdown is similar to a bank closing its doors — people cannot retrieve their funds.
While proponents of bitcoin hail its anonymity and lack of ties to traditional banking, regulators have become increasingly interested in the digital currency due to its usage by criminal elements and its volatile nature. It has been a rough month for bitcoin investors, with cyber attacks on several exchanges, a sharp fall in bitcoin’s value, and rising pressure from regulators. Bitcoin’s price varies by exchange, but the losses were most dramatic on Mt. Gox, where it fell to about $135 from $828.99 before February 7. “Mt Gox has been broken and it was obvious there was something really bad going on there for nearly a year.
They were processing withdrawals very slowly and generally being very opaque about what was going on there,” said Mike Hearn, a bitcoin developer in Zurich, Switzerland. A second source familiar with the case said US federal law enforcement is investigating Mt. Gox. A third source said the US Federal Bureau of Investigation was monitoring the situation. Japan’s finance ministry and police are also looking into the abrupt closure of Mt. Gox, according to the Japanese government’s top spokesman.
MALLEABILITY
Bitcoin has gained increasing acceptance as a method of payment and has attracted a number of prominent venture capital investors, including Andreessen Horowitz and Union Square Ventures. The digital currency has also caught the eye of hackers. The recent cyber attacks exploited a process used by some bitcoin exchanges that introduced “malleability” into the code governing transactions, experts said. Simply put, this allowed hackers to slightly alter the details of codes to create thousands of copies of transactions.These copies slowed the exchanges to a crawl, forcing them to independently verify each transaction to determine what was real and what was fake. A document circulating on the Internet purporting to be a crisis plan for Mt. Gox, said more than 744,000 bitcoins were “missing due to malleability-related theft,” and noted Mt. Gox had $174 million in liabilities against $32.75 million in assets. It was not possible to verify the document. If accurate, that would mean approximately 6 percent of the 12.4 million bitcoins minted would be considered missing.
Developers are working on fixes to bitcoin’s software to guard against cyber attacks, though many larger service providers have already implemented such changes, according to Gregory Maxwell, one of the bitcoin software’s core developers. He said some malleability in the software protocol was necessary — for example, in transactions where multiple people can put in money, but the transaction is not valid until enough funds are contributed. “None of these fixes are especially complicated, but because the correctness of the software is important we use a conservative release process that avoids rushing anything out,” Maxwell said, adding that the bulk of the recent work on the software is being done by four people.
BITSTAMP
Jacob Dienelt, who trades bitcoins and sells paper bitcoin wallets, said people he knows in the bitcoin community in New York stopped using Mt. Gox when the exchange halted dollar withdrawals several months ago and said all withdrawals had to be in bitcoin. Dienelt said has not been subpoenaed. With Mt. Gox’s shutdown, Bitstamp has handled the most volume in the last two days, with more than 165,000 US dollar transactions, according to Bitcoincharts. Bitstamp had temporarily halted customer withdrawals earlier this month, citing “inconsistent results” and blaming a denial-ofservice attack.The price of bitcoin was lately at $588 on Bitstamp, up about 7% on the day. “Right now is a sweet buying opportunity. I don’t think you’re going to see bitcoin go this low for awhile — if ever again,” said Jordan Kelley, chief executive of Robocoin, which launched the world’s first Bitcoin ATM in Vancouver, Canada, in the fall. “The more that bitcoin is on the front pages, the more that people are discussing it and educating one another, the better for the currency.” Kelley said Robocoin has not been subpoenaed in the US regulatory probe; nor has New York-based exchange Coinsetter, according to a spokesperson. Bitstamp did not respond to requests for comment.
-
Dragnet Nation’, by Pulitzer Prize Winner Julia Angwin – Be Warned About Dangers of PCs / Mobile Phones Being Hacked
While driving back from Long Island on Monday, February 24, I listened to an absolutely fascinating interview of Pulitzer Prize winning journalist Julia Angwin, author of Dragnet Nation, on the issue of privacy and cyber crime.
I was amazed at how easy it is for your personal financial information to stolen if you use mobile phones for your banking transactions – in particular if you use the Android operating system. There was a program on TV recently which showed how your laptop or mobile phone could be hacked within 15 seconds of your activating it in Sochi for the Olympic Games.
Certain hi-tech global firms (and I worked for one such) instruct their consultants / executives going to China / Hong Kong / Russia / Eastern Europe to only carry essential information on a separate PC. Once back in the US these are to be trashed or the drives completely reformatted – the danger of worms and viruses is so great that the danger of contamination is not worth it. BTW those in the US need not be ‘holier than thou either’.
When the People’s Republic of China ordered a Boeing transport for their President, Boeing based in the good old US of A sent the order with so many bugs pre-installed that the Chinese trashed the plane after discovering hundreds of them. Now we in India buying defense hardware from either the US or the Soviet bloc should be fully aware that it is possible that in the era of cyber warfare the sellers can render them non-functional anytime, if they want to.
I hope our Italian barmaid’s Congress Party government in India is doing something about it. When Narendra Modi becomes Prime Minister, let us hope that he brings in some top flight IT cyber crime expert ‘ethical hacker’ types to assist him. The BJP is largely known (ahem!) for good solid Hindutva bhaiyya types of limited education and not for techno nerds of Silicon Valley.
-
Interim Budget 2014: Cars, consumer durables to be cheaper
NEW DELHI (TIP): Financial markets went in for the interim budget with little expectation, and rightly so, as finance minister P. Chidambaram was not expected to tinker with the existing tax laws. But he still had room to manoeuvre and propose changes that will have an impact on your money, well, for at least three months of the next financial year. The markets were looking for the government to contain its deficit under the budgeted target of 4.8% of the gross domestic product (GDP) for the year.
The government managed to restrict the fiscal deficit to 4.6% of the GDP, and now expects it to come down further to 4.1% in the next fiscal. Therefore, the two very important indicators—the fiscal deficit and the current account deficit which were worrying the financial markets and individuals alike—are now in a much better shape than a year ago, though the improvement under both the heads can be debated. Beyond this critical number of fiscal deficit, there was not much that markets were looking for.
As a result, the BSE S&P Sensex closed with a modest gain of 0.48%. However, there were some surprises for individuals. If you plan to buy a new car, there is good news as excise in this segment has been reduced, and so they are likely to be cheaper. There is also relief in store for those struggling with the burden of education loans, taken up to 31 March 2009. We take a close look at some of the proposals that will have an impact on your pocket.Relief on student loans
The budget has extended the education loan subsidy scheme with some significant benefits. The finance minister has proposed a moratorium wherein you will not have to pay the interest on your education loan taken before 31 March 2009. The government will shoulder the burden of the outstanding interest portion as of 31 December 2013. From January 2014 onwards, you pay. Given that these loans were taken about four-and-a-half years back, borrowers are likely to have finished their education and moved on to jobs or are at least looking for one.The difficult economic scenario in the country, with the GDP growth having fallen from 6.7% in FY09 to a budget estimate of 4.9% for FY14, jobs are not that easy to come by. Says A. Krishna Kumar, managing director and group executive (national banking), State Bank of India (SBI): “This is definitely a good move and will ease pressure on those who are still looking for jobs.” It is too early for banks to know exactly how much this liability is. SBI’s Kumar says, “We are yet to calculate the exact impact on our outstanding education loans.” The government has given an estimated benefit of around Rs.2,600 crore to about 900,000 borrowers. How does this work for you? We take an example using a calculator on Punjab National Bank’s website. Let’s assume, you took an education loan of Rs.10 lakh in April 2007 for a two-year course.
The interest rate was 12% per annum for 10 years with no processing fees. Your equated monthly instalment (EMI) per month was likely around Rs.14,350. Let’s say, you got a job after two years and started to repay the loan. But in December 2012, you lost your job and have not been able to pay the EMI since. In this case (assuming that the bank hasn’t invoked the guarantee or declared the loan as a bad debt), your outstanding EMIs for 12 months (as on December 2013) would be about Rs.1,72,200. Of this, the interest would be Rs.63,710. As the proposal suggests, the government will pay this outstanding interest on your behalf.
You will, however, have to start paying from January 2014. More details are awaited. Also, the relief is only for the outstanding interest and not the principal. Your final benefit will depend on the terms of the loan— when you took the loan, the interest rate, the period for which you haven’t paid, and others. It would be pre-emptive to say that this move will result in borrowers becoming complacent and the unpaid dues in this segment going up. Moreover, these loans are not a big portion of banking credit.
Cheaper wheels
Another piece of good news came by the way of the proposal to reduce the excise duty for the auto sector till 30 June. The excise duty has been reduced from 12% to 8% on motorcycles, scooters, small cars and commercial vehicles—such as Maruti Suzuki India Ltd’s Alto, Hyundai Motor India Ltd’s i10, Tata Motors Ltd’s Indica, Bajaj Auto Ltd’s Pulsar and TVS Motor Co. Ltd’s Wego.For large and mid segment cars, the reduction is from 27% or 24% to 24% or 20%; and for sports utility vehicles (SUVs), from 30% to 24%. According to Prabhudas Lilladher Pvt. Ltd, the benefit is expected to be Rs.1,500-2,000 for two-wheelers and Rs.15,000-20,000 for small cars.
SUVs should be cheaper by Rs.48,000-60,000, but “given the current slowdown, the automakers may not be able to pass on the entire benefits for SUVs”, says Surjit Arora, research analystinstitutional equities, Prabhudas Lilladher. This may generate more demand and improve sales. Yaresh Kothari, research analyst-automobiles, Angel Broking Ltd, says, “It is a positive announcement for the sector. The cut in excise duty will be passed on to the consumer. Historically, they (auto manufacturers) have always done it. The benefit will differ based on the price of the vehicle.”
Says Suresh Sadagopan, a Mumbai-based financial planner: “It’s a one-time kind of savings possibility in the short term. If you plan to buy, try and cash in on this benefit before 30 June.” Consumer goods For the mobile handset segment, the finance minister announced that excise duty for all categories of handsets will now be 6% with central value-added tax (Cenvat) credit or 1% without it. Last year, the excise on mobile phones priced above Rs.2,000 had been raised to 6% from 1%, upsetting the industry as the cost of smartphones went up. The reduced excise, however, may not mean cheaper phones.
“This will not have any significant impact on prices as it will reduce costs marginally given the competition from Chinese manufacturers and the grey market,” says Hemant Joshi, partner, Deloitte Haskins and Sells. Cenvat credit essentially means that a manufacturer can set off excise or service tax paid on the input cost—for example, of raw materials— against its total excise liability. “This may give an edge to domestic manufactures as importers will continue to pay 6%,” says Bipin Sapra, tax partner, EY.
Two domestic phone manufacturers—Micromax and Karbonn—were the third and fourth largest mobile handset sellers in India with 10.1% and 9.1% market shares, respectively, at the end of the December-2013 quarter, according to International Data Corp. The leader is Samsung, followed by Nokia. The finance minister also proposed to reduce the excise duty on capital goods and consumer nondurables from 12% to 10% for items falling under chapters 84 and 85 of the Central Excise Tariff Act.
“What this means is that prices of some products such as basic machinery and electronic goods will be affected,” says Sapra. Prices of items such as washing machines, vacuum cleaners, computers, transistors, batteries, software, basic landline telephones, computer disks, knitting machines, etc., may go down if manufacturers choose to pass on the benefit. Super-rich surcharge The surcharge on the super-rich remains. Last year, a 10% surcharge was applied to those with taxable income above Rs.1 crore. This onetime move was supposed to be only for the assessment year 2014-2015, and was in addition to the education cess of 3%.
The surcharge and income tax rates will continue for the purpose of deduction of tax at source from salaries during the financial year 2014-15, and for computing the “advance tax” payable during that financial year on current incomes. “Practically, the income tax rates, including surcharge, will apply for tax withholding or payment of advance tax. Salaried individuals who pay taxes every month will have to pay this surcharge till the time the new government drops it.
But non-salaried individuals, who pay advance tax only in September, may not have to pay the additional surcharge at all if the new government drops it,” says Kuldip Kumar, executive director, PwC India. According to the Finance Bill, the total amount payable as income tax and surcharge shall not exceed the total amount payable as income tax on a total income of Rs.1 crore by more than the amount of income that exceeds Rs.1 crore. Here’s an example.
The tax liability on a taxable income of Rs.1 crore is around Rs.29 lakh. So, if the income is even Rs.10 more than Rs.1 crore, the tax liability will go up by only Rs.10 and not Rs.2.9 lakh. Overall, while the finance minister managed to deliver on his promise of containing expenditure, the reduction in excise duty on various items and relief on education loans will also benefit a key constituent in elections—the middle class. The excise relief will lapse if the new government decides against it. Investors and consumers now have to wait till the new government presents its budget for the full year and give a fresh direction to economic policy and tax laws.
