Monsoon hits Kerala, finally

As of now the monsoonal flow is strong and Kerala and parts of South Karnataka will continue to get rains for the next two to three days

New Delhi: South-west monsoon, the key to the agriculture driven trillion-dollar Indian economy, on Tuesday brought showers to Kerala in South India bringing much-needed relief to farmers, reports PTI.

"Monsoon has reached Kerala," a top India Meteorological Department (IMD) official said.

Kerala usually receives monsoon showers by 1st June, but scientists said there was no need to paint a gloomy picture as the progress of the seasonal rainfall phenomenon was well with the forecast limits which have a model error of four days.

"As of now the monsoonal flow is strong and Kerala and parts of South Karnataka will continue to get rains for the next two to three days," D Sivananda Pai, Director, National Climate Centre and lead forecaster for monsoon, told PTI.

Pai said conditions were favourable for further advance of monsoon.

Monsoon watchers attribute the slight delay in the onset of monsoon to Typhoon Mawar which was active in western Pacific Ocean off the Philippines and sucking away moisture and wind currents to power itself.

The IMD declares the onset of monsoon over Kerala when 50% of the 14 observation stations in the state and Lakshadweep islands report rainfall for 48 hours.

Monsoon rains are crucial for agriculture as only 40% of the cultivable area is under irrigation. The farm sector contributes about only 15% to the country's Gross Domestic Product (GDP), but it employs about 60 per cent of India's population.

On the back of good monsoon in 2010 and 2011, the country harvested a record foodgrains production of 245 million tonnes and 252.56 million tonnes, respectively.


How Bank of America execs hid losses: In their own words

A suit reveals how Bank of America knew about big losses at Merrill Lynch before the companies merged but didn't tell shareholders

When Bank of America announced it was buying Merrill Lynch in September 2008, bank execs told their shareholders that the merger might hurt earnings a touch. It didn't turn out that way. Losses at Merrill piled up over the next two months, before the deal even closed. Yet the execs kept painting a prettier picture to shareholders — even though it turns out they knew better.

As the New York Times detailed this morning, a brief in a new lawsuit filed in federal court in Manhattan recounts sworn testimony and internal emails in which execs admitted to giving bad information to shareholders and that they had worried about the legal ramifications of doing so.
According to the filing, Bank of America's then-CEO Kenneth Lewis admitted in a deposition that what he told shareholders about the financials of the merger was "no longer accurate" on the day they approved it.

We've pulled out the most revealing parts of the suit, which tell the story of how the deal went down.
On Sept. 15, 2008, Bank of America announced its agreement to buy Merrill Lynch. In the press release announcing the deal and other presentations, Bank of America said it would cause a 3 percent decrease in earnings in 2009, and that by 2010 the deal would break even or do better.
In October, concerns started to emerge about Merrill's financials. As it became clear the company was going to lose $7.5 billion that month, one exec emailed another the numbers with the message "read and weep."

Merrill kept losing money in November. Late that month, Bank of America ordered Merrill to sell off assets to try to stabilize its finances:
Forcing Merrill to down-size (p. 18)

After current Bank of America CEO Brian Moynihan admitted in a deposition that this sale meant the deal was less valuable to shareholders:
Impact of Merrill's down-sizing (p. 21)

On Dec. 1, Bank of America issued a $9 billion debt offering. Publicly, they said this was "for general corporate purposes." But private communications showed that they were trying to raise money to cover Merrill's losses:

Bank of America's then-treasurer, Jeffrey Brown, wrote in emails just before the shareholder meeting that they needed to disclose that the Merrill losses were behind the debt offering. He also testified that he told other execs they could be committing a criminal offense by not disclosing the losses:

On Dec. 5, Bank of America shareholders met to decide whether to approve the merger. They questioned Lewis about the financial impact of the deal, and he reassured them: 

That day, shareholders voted to approve the merger.
In his deposition for the lawsuit, Lewis said that what he told them was not accurate. Bank of America had already revised their numbers to reflect Merrill's losses:

Just days after the deal was approved, on Dec. 12, a law firm for Bank of America prepared documents making the case that they could back out of the merger, based on Merrill's new financial woes:

On the 17th, Lewis took that argument to then Treasury Secretary Henry Paulson and Fed Chairman Ben Bernanke, who, according to the lawsuit, were stunned by Merrill's losses:

According to the suit, Lewis raised the possibility of a bailout then:

But it wasn't until January that shareholders - and the public - learned how bad things were. Bank of America stock dropped precipitously, and taxpayers ultimately padded the bank's bailout funds with an extra $20 billion to cover the losses. The SEC has actually already settled its own charges against Bank of America over misleading shareholders on the deal. The bank paid $150 million - and didn't admit any wrongdoing.

Bank of America didn't comment to the Times on the new lawsuit, and didn't immediately respond to a request for comment from us.



Personal Finance Exclusive
Ensure premature termination of term deposits in case of demise of a joint holder

Distinguished economist and former RBI governor SS Tarapore calls for implementation of guidelines so that families do not suffer due to onerous bank procedures

Economist SS Tarapore, a distinguished economist and a former deputy governor of the Reserve Bank of India (RBI), in his column Maverick View in the Hindu Business Line – When death visits a bank deposit raises certain vital concerns that call for immediate action on the parts of RBI/DBOD, BCSBI and IBA.

“Ensure that all banks incorporate a clause in the account opening form to the effect that during their lifetime all joint holders should get the option to state that premature termination of the term deposit may be permitted in the event of the demise of one of the joint holders, particularly the first holder... It would be best if, on the term deposit receipt itself, there is a stamped and signed endorsement by the bank that in the event of death of a depositor premature termination will be permitted.”
Mr Tarapore rightly asks, “How many families should suffer before the RBI realises that too many have suffered?” He calls on the top management to review the RBI’s November 2011 circular.  He writes that one of the earliest initiatives taken by Dr YV Reddy when he took charge as RBI governor was to ensure that common man was not subjected to onerous bank procedures.

Presently dealing with this matter are RBI circulars of 14th March and 4th November 2011, where the BCSBI Code on Bank’s Commitment to Customers July 2006 was revised in August 2009.

In the light of prevailing conditions and taking a cue from Mr Tarapore all of them need to be revisited de novo and replaced by an all comprehensive circular covering all aspects including a clause in the term deposit application form, term/recurring deposit receipt, making it clear that the joint holder, as the survivor, becomes automatically entitled to the proceeds, including premature encashment subject to the heirs presenting the banks appropriate documents as to their title thereto.

The law anyway lays down that the joint holder or the nominee, if any, only holds the funds of the deceased as a trustee for the heirs and doesn’t become an absolute owner.

Since the accounts like joint operations, either or survivor and number one or survivor, belong to different genres, clear cut guidelines are required for disposition in the case of each of these. Also in the case of nominees more particularly when there are conflicting claims by heirs and/or interested parties.

After reading Mr Tarapore’s article, we collected the term deposit application forms from four PSU, three co-operative and two private banks. It was noticed that only Canara Bank, Saraswat and NKGSB Bank’s application forms contained relevant declarations that are reproduced hereunder.

Our discussions with bank managers disclosed total lack of clarity on the concerns raised. To err on the safer side their immediate reaction was to first mark the account with remark ‘Deceased’ and freeze the account and demand all kinds of documents like succession certificate, probate, etc. This botheration happens when they are not required or relevant, more so when the money is most required for the grieving families, most in middle-class and below.

The RBI in its wisdom needs to re-examine the matter and mandate immediate incorporation of an appropriately worded clauses clearing spelling out the mode of disposition in all the three circumstances of joint holding at the earliest to prevent unnecessary hardships to poor depositors.

Relevant extracts from Term Deposit application forms

Canara Bank—“In the event of the death any of the joint depositor/s prior to the maturity of the deposit, the bank will at the written request of the surviving depositor/s be at liberty, though not bound and at its absolute discretion  to pay interest till the date of settlement, to repay the deposit before maturity or to grant an advance against the  security thereof to any one or more of the surviving depositor/s with the consent of other surviving depositors/any of the surviving depositors as the bank may decide and to add/delete/substitute any names therein. The discharge given by such surviving depositor/s/any of the surviving depositor/s shall give the bank a valid discharge.”

Saraswat Bank—“Special instruction for term deposit : In the event of death of any of the joint depositors prior to the maturity of the deposit, the bank will be, at the request of the surviving depositor or all surviving depositors at liberty though not bound and at its absolute discretion to add/delete any name, or to repay the deposit before maturity or grant an advance against the security thereof, on such terms and conditions as the bank may decide and such payment before maturity shall constitute a valid discharge to the bank.”

NKGSB Coop Bank—“In the event of any of us, the bank shall be at liberty to make payment of the money to the survivors without the concurrence of the legal heirs of the deceased (?).”

(Nagesh Kini is a Mumbai based chartered accountant turned activist.)




4 years ago

Just love your post.Very helpful and very detailed.Actually i am looking for the information related to recurring deposit.I want to know what happen if such type of demise is happened with this is possible?? Here i find some information here

Anil Agashe

4 years ago

High time this is done. There is no sanctity to Jt A/cs if this is not done. The survivor should automatically become the sole depositor and all rights must be given to him in respect of the deposit. Will, probate or any other document should not be required as joint name is as good as will!

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