G-Sec Yields up

The 10-year benchmark G-Sec yield, which sets the tone of the fixed-income market, increased...

Premium Content
Monthly Digital Access

Subscribe

Already A Subscriber?
Login
Yearly Digital+Print Access

Subscribe

Moneylife Magazine Subscriber or MSSN member?
Login

Yearly Subscriber Login

Enter the mail id that you want to use & click on Go. We will send you a link to your email for verficiation
Bulls Too Tired To Run
What a difference a year makes! After hitting a peak of 30,000 in March 2015, the Sensex has staged a steady decline, and is now down by over 22%. From the beginning of this year itself, the Sensex is down nearly 12%. The reason is that bad news has come in droves. It started with demand notices by the Indian tax authorities on foreign institutional investors, followed by the Greek crisis, China’s economic woes, continued crash in crude oil prices, and the US Fed raising interest rates. As we had highlighted in our earlier Cover Stories, the bull market was driven by euphoria. Investors expected that earnings growth would revive with the policies of the new government which would justify the high valuations. This has not happened. With valuations now cooling off, it is worth looking at only a few sectors for potential winners.
 
With the Bank Nifty down by over 25% over the past year, most investors would be wondering if it is a good time to invest in banking stocks. R Balakrishnan goes deeper into the issue by working out the valuation of banking stocks. Checkout his views on page 22.
 
While prime minister Narendra Modi is enthusiastically promoting the MakeInIndia campaign, there are several issues on the ground that need to be cleared up first. Infrastructure, especially roads, is one such area. Sucheta, in her Different Strokes column, writes that there is an urgent need to revamp the National Highways Authority of India. She lists the multifarious problems NHAI is faced with. Unless the government addresses these, rapid road building will remain a pipedream. 
 
On 5th March, Moneylife Foundation is headed to Pune to celebrate International Women’s Day. We will have with us Sindhutai Sapkal, an amazing social activist known for taking orphan children in her care. She will deliver the keynote address. The presentation of the Majhi Maitrin’s awards for women achievers will take place during the event. The details of the programme are given on page 9. Those who are in Mumbai, and interested in stocks, do not miss Moneylife Smart Savers Investor Club’s 2nd programme. Details on page 47.

User

Supreme Court asks RBI to submit list of big defaulters
RBI has been asked by the apex court to submit list of big defaulters or whose loans have been restructured under the CDR scheme
 
The Supreme court on Wednesday asked the Reserve Bank of India to furnish a list of the companies which are in default of loans in excess of Rs500 crore or whose loans have been restructured under corporate debts restructuring (CDR) scheme by banks and financial institutions.
 
While asking the RBI to file an affidavit, the apex court bench headed by Chief Justice GS Thakur directed that the list be furnished to it in a sealed cover that would include details of defaults of over past five years. The Court said this as one of the counsels told the court about commercial confidentiality of the companies.
 
During FY2013 to FY2015, 29 public sector banks (PSBs) wrote off a total of Rs1.14 lakh crore of bad debts. RBI had disclosed in a reply under Right to Information (RTI) Act that the bad debts shot up over three times to Rs52,542 crore as on March 2015 from Rs15,551 crore on March 2012. State Bank of Saurashtra and State Bank of Indore have shown zero bad debts over the past five years.
 
The Court order came in the course of the hearing of a public interest litigation pointing to loans given by Housing and Urban Development Corporation (HUDCO) in 2003 to some of the companies with questionable track records.
 
According to a newspaper report, during 2004 to 2012, the bad debt of PSBs grew at 4%, which rose to about 60% during FY2013 to FY2015. The bad debts written off in the financial year ending March 2015 make up 85% of such loans since 2013, the report says.
 
Earlier in December 2015, the Supreme Court, in a landmark judgement, has told the RBI that the banking regulator cannot withhold information citing 'fiduciary relations' under the Right to Information (RTI) Act. Hearing a set of transferred cases, a Division Bench of Justice MY Eqbal and Justice C Nagappan said, "From the past we have also come across financial institutions which have tried to defraud the public. These acts are neither in the best interests of the Country nor in the interests of citizens. To our surprise, the RBI as a Watch Dog should have been more dedicated towards disclosing information to the general public under the Right to Information Act. We also understand that the RBI cannot be put in a fix, by making it accountable to every action taken by it. However, in the instant case the RBI is accountable and as such it has to provide information to the information seekers under Section 10(1) of the RTI Act."
 
In most of the transferred cases, Shailesh Gandhi, former Central Information Commissioner, while directing the RBI to provide information sought by applicants, has rejected the central bank's contention of 'fiduciary relation' for denying information.

User

COMMENTS

MG Warrier

10 months ago

Where public funds including bank deposits get stuck in bad loans, not only judiciary and regulators, the owners of the resources have a right to know where and why things are going wrong. Here, if legal constraints emanating from bank-customer relationship come in the way, it is time to think in terms of removing legal hurdles through appropriate legislation.

R Balakrishnan

10 months ago

Banks print names and photos of small loan defaulters. Defaulter information should be pubic data. What about the bulk who are defaulters below Rs.500 cr?

REPLY

Vivek Naik

In Reply to R Balakrishnan 10 months ago

absolutely correct :)

We are listening!

Solve the equation and enter in the Captcha field.
  Loading...
Close

To continue


Please
Sign Up or Sign In
with

Email
Close

To continue


Please
Sign Up or Sign In
with

Email

BUY NOW

The Scam
24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
Moneylife Magazine
Fiercely independent and pro-consumer information on personal finance
Stockletters in 3 Flavours
Outstanding research that beats mutual funds year after year
MAS: Complete Online Financial Advisory
(Includes Moneylife Magazine and Lion Stockletter)