Money & Banking
Government to finalise Rs15,000 crore fund infusion in PSBs this week

Top three banks which require capital are Indian Overseas Bank, Central Bank of India and the Bank of Maharashtra

New Delhi: The Union government said it will decide about Rs15,000 crore capital infusion in the public sector banks (PSBs) to shore up their capital base this week, reports PTI.


"This week there will be some announcement about the allocation (to various banks)," Department of Financial Services Secretary DK Mittal said.


"Allocation of the funding will be decided and rest I think the process still has to go through," he said.


Asked if the capital infusion would be done through rights issue, he said it has to be first approved by respective boards and then the Finance Ministry will take a view on that.


"If there is rights issue, there is scope for anybody to go in...LIC is not a short-term investor," he said to a query if LIC will be asked to subscribe to the rights issue.


"May be LIC will also make money by selling some of the equities when they come to the market," he added.


He said the government has made budget provision of Rs15,000 crore for recapitalisation of banks in the current fiscal.


The top three banks which require capital are Indian Overseas Bank, Central Bank of India and the Bank of Maharashtra. State Bank of India would also need capital, he said.


All but one Dena Bank have tier I capital of above 8% well above Basel norms.


Asked about holding company structure, Mittal said the Reserve Bank of India has given its feedback and the Finance Ministry is analysing it.


"RBI has broadly agreed on this... However, there is a need to look at regulatory platform because it would be such a large conglomerate (holding company) and how to be regulated.


What kind of capital adequacy it should have," he said.


"Broadly, they (RBI) said we support this view...the government is yet to take a view on (holding company structure for the public sector banks)," he said.


The 2012-13 Union Budget had proposed setting up of a financial holding company that would help raise resources to meet capital needs of state-owned banks. .


On the cash subsidy transfer scheme roll out from 1st January, Mittal said banking system is fully ready for the roll out across the identified districts.


"Banking system is fully geared up to meet this challenge. We have been working on this the last 10 months and I think banking system has done a great job, including private sector banks also, and we are fully ready," he said.


Meanwhile, Central Registry of Securitisation Asset Reconstruction & Security Interest of India (CERSAI) and Credit Information Bureau (India) Ltd (CIBIL) have signed an agreement to share information.


"This partnership between the two institutions has been conceived with a view to bringing synergy of information and operations by the lending institutions," he said.


This collaborative venture will bring considerable value to the industry and enhance their confidence in lending, he said.


The scope and coverage of the central registry will be further expanded to include a host of other activities and information that relate to the financial sector, he added.


As many as 296 banks, housing finance companies and financial institutions have so far registered themselves with CERSAI and are filing the details of the mortgages taken by them by deposit of title deeds. It has now a data base of more than 75 lakh records of equitable mortgages.


Banks can, before accepting any title deed for mortgage, make a search in the CERSAI record to ensure that there is no existing mortgage or loan against the property, and thus avoid any potential fraud or multiple financing.



nagesh kini

5 years ago

When the PSBs are doing well on the stock exchanges as the result of investor confidence, I feel it will better to open the new issue to small and/or domestic institutional share holders to the exclusion of FIIs, this will enable local infusion instead of the Government increasing its equity which it should decrease any way. It can divest some of it through this route too.

Thane Municipal Corp seals HDFC Bank ATM for 'non-payment' of property tax

According to TMC, the total dues on the premises where the ATM of HDFC Bank is located are Rs13.64 Lakh including Rs12.40 lakh as property tax

Thane: Thane Municipal Corporation (TMC) has sealed an HDFC Bank ATM in the city for alleged non-payment of property tax to the tune of Rs12.40 lakh, reports PTI.


A civic team led by Kopri Ward Officer sealed the HDFC Bank's ATM situated at Narayan Nivas Building near the railway station, a release said.


According to TMC, the total default due on the premises where the ATM is located is Rs13.64 Lakh including Rs12.40 lakh towards the property tax.


Meanwhile, HDFC Bank sources said that according to information available immediately the landlord has not paid the property tax, which has invited the civic action.


Moneylife RTI workshop: How to use RTI effectively, for beginners

The 140th seminar of Moneylife Foundation was focussed to empower those who are planning to seek information under the Right to Information Act 

The second beginners’ workshop on the Right to Information (RTI) Act received a good response from Moneylife Foundation members. Over 100 members participated in the first set of workshops for beginners as well as regular users of the RTI Act. The sessions were conducted by former Central Information Commissioner (CIC), Shailesh Gandhi. Mr Gandhi focussed on the understanding of the key provisions of the RTI Act and how to file effective applications with important dos and don’ts to ensure your queries are answered. Mr Gandhi delved more on the intricacies of filling the forms and the best practices to be followed.
Similar to the previous seminar for beginners, Mr Gandhi took the members through the important sections of the RTI Act in detail. He focussed on what kind of information can be sought and emphasised that all information that is available as a record in any tangible form can be provided. Mr Gandhi explained the RTI application format and the format for filing an appeal to the participants. He mentioned that an applicant should be put down his queries in a concise and specific manner. The information sought should not be vague and a reasonable timeline should be given and most importantly whether the information sought will be available on record. The application should be addressed to the right department, he added. If not done, it would create unnecessary delays. The RTI should be sent preferably through Speed Post, as this you get an acknowledgement that the public information officer (PIO) has received it.
Mr Gandhi also covered the sections under which information can be refused. The only sections under which the information sought can be refused are Section 8 and Section 9 of the RTI Act, explained Mr Gandhi. The RTI Act lists special instances where the authorities are exempt from disclosing information. Section 8 of the Act for the exemption from disclosure of information is used as a lame excuse not to provide information. There have been many examples where the citizen has got the information he or she asked for, which has been earlier denied to him by the PIO or Appellate Authority, under the pretext of Section 8. For, when the citizen pursued the matter by appealing to the Central or State Information Commissioner, he or she invariably received the information. In other cases, the Information Commissioner also denied the information, so the citizen appealed to the high court and won the case, as the judge directed the information commission to provide information. Mr Gandhi explained this section in detail and offered advice how one can phrase their queries in such a way that the information cannot be rejected under this section.
We have also compiled a list of important judgements in cases where the information sought has been wrongly refused. Read here
The next session on RTI is for advanced RTI users on 17 December 2012. This session is for those who have already filed multiple RTI applications and need to understand how to navigate the appeals process all the way to the CIC hearings. Another set of workshops would be conducted next month as well on the first and third Monday for beginners and advanced users respectively.
 For more information on RTI workshops, click here.


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