Banking
RBI cuts RTGS deal threshold to Rs1 lakh till Saturday

 

The threshold limit in RTGS System transactions has been cut to Rs1 lakh from existing Rs 2 lakh until 9th June

Mumbai: The Reserve Bank of India on Friday said it has cut down the threshold limit in Real Time Gross Settlement (RTGS) System transactions to Rs1 lakh from existing Rs 2 lakh until 9th June due to some technical issues, reports PTI.
 
"To ensure that customers were not unduly inconvenienced, the Reserve Bank temporarily brought down the threshold limit in RTGS to Rs1 lakh from the existing Rs2 lakh. This arrangement would continue till Saturday, 9 June 2012," RBI said in a notification.
 
There was delay in processing of transactions of RBI's National Electronic Funds Transfer (NEFT) on 5th June due to some technical glitches that resulted into delay in transmission to destination banks.
 
However, issues were addressed to large extent by 6th June, RBI continues to monitor and address some residual issues, it said.
 
The NEFT which is operational since 2005 is a pan-India one-to-one funds transfer system used by individuals, corporates and governments. The transactions in the system are put through various bank branches across the country.
 
Around 18 million transactions are processed every month on an average through this system.
 
The volume of transactions processed in NEFT over the last three years has witnessed 100 per cent year-on-year growth, RBI said.

User

COMMENTS

MParker

4 years ago

This is a great thing for India. I wish Square and or mPowa (www.mpowa.com) could bring their businesses there.

NHB to raise Rs120 crore for its mortgage guarantee company

 

According to the NHB chairman home loan rates are likely to come down by 25-50 basis points in the current financial year, given the probability of reduction in policy rates

Mumbai: Housing finance regulator National Housing Bank (NHB) has received nod from the Foreign Investment Promotion Board (FIPB) to float its mortgage guarantee company and will raise Rs120 crore of paid-up capital in the next two weeks for the same, a top bank official said, reports PTI.
 
"We have already received FIPB approval to float our mortgage guarantee company and will raise Rs 120 crore in the next two weeks," NHB Chairman & Managing Director RV Verma told reporters on the sidelines of the Skoch summit.
 
He said that International Finance Corporation (IFC) and Asian Development Bank (ADB) will partner NHB in forming the mortgage guarantee company.
 
A mortgage guarantee company provides credit guarantee to housing finance companies and banks on behalf of home loan borrowers.
 
Verma also said home loan rates are likely to come down by 25-50 basis points in the current financial year, given the probability of reduction in policy rates.
 
The NHB, which is likely to disburse Rs15,000 crore by the financial year ending in June, is hopeful of disbursing around Rs17,500 crore in the next financial year (July-June).
 
The bank also said it will look to securitise some of its assets in 2012-13, which will enable it get instant liquidity. The bank is also planning to provide Rs100-Rs150 crore to housing finance companies as part of securitisation, he said.
 
"Securitisation deals are less these days, due to some taxation issues. We are planning to provide Rs100-Rs150 crore to housing finance companies, as part of the securitisation deal in next fiscal," he said.

User

RBI cancels licence of scam-tainted Madhavpura Mercantile Bank

 

 

Over past 10 years, the Bank's reconstruction scheme did not make much progress mainly due to non-fulfillment of commitments for contribution to revival fund by UCBs and poor track record of recovery including from Ketan Parekh

New Delhi: The Reserve Bank of India has cancelled licence of security scam-tainted Madhavpura Mercantile Cooperative Bank following failure of efforts to revive it, reports PTI.
 
"All efforts to revive it in close consultation with the Government of India had failed and the depositors were being inconvenienced by continued uncertainty," RBI said in its order cancelling the licence of the Ahmedabad-based cooperative bank.
 
The cooperative bank, was granted a licence by RBI in 1994, resorted to indiscriminate lending, particularly to companies linked to stock broker Ketan Parekh, in gross violation of lending norms during 1999-2000.
 
In March 2001, there was a sudden run on the cooperative bank following rumours of its large exposure to Ketan Parekh, a leading stock broker at Mumbai, who suffered huge losses in his share dealings, it said.
 
The cooperative bank was also holding substantial amount Rs800 crore of inter-bank deposits from a large number of Urban Cooperative Banks in Gujarat and from other banks and this posed a systemic risk for cooperative banks in Gujarat, it said.
 
The restructuring scheme initiated in 2001 envisaged infusion of funds, retention of existing deposits, converting call money borrowings from banks/institutions into term deposits, DICGC meeting its obligation in full to the cooperative bank's eligible depositors, investment of fresh deposits in Government securities, management aspects etc.
 
"During the period of 10 years, the Reconstruction Scheme did not make much progress mainly due to non-fulfillment of commitments for contribution to Revival Fund by UCBs and poor track record of recovery including from Ketan Parekh. The scheme expired on August 23, 2011," it said.
 
As of March 2011, the bank's assessed net worth was negative Rs1,316.50 crore, gross NPAs was 99.99%of its total advances of Rs1,126.59 crore. The bank had accumulated losses at Rs1,357.41 crore. The deposits of the bank have been eroded fully at the end of March 2011.
 
In view of the precarious financial position of the cooperative bank, a show cause notice was issued by RBI on 16 March 2012 asking it as to why the licence granted to it to carry on banking business in India should not be cancelled.
 
The cooperative bank in its reply dated 18th April, accepted that the precarious financial position of the cooperative bank which was attributed to the fraud amounting to Rs1,200 crore committed on the cooperative bank by the share broking community including Ketan Parekh and his associates in collusion with the then members of the Board of Directors, the RBI statement said.
 
As per the bank, it said, an amount of Rs803 crore constituting 72% of the total advances were unsecured due to unenforceable securities and defective documentation and hence not recoverable.
 
The cooperative bank has admitted that the revival of the bank failed due to difficulty in mobilising revival fund from the contributing UCBs and poor track record of recovery particularly from the Ketan Parekh group, it said.
 
The statement also said that the cooperative bank had furnished another revival plan envisaging a loan of Rs1,000 crore from World Bank or European Banks which will be procured by an NRI who will invest Rs500 crore for the next 10 years in the form of preference shares totaling Rs5,000 crore.
 
"It was observed that the cooperative bank was neither aware of the antecedents of the investor nor the genuineness of the sources of the funds," it said.
 
The cooperative bank was not sure whether the proposal will result in a turnaround for the cooperative bank by making its net worth positive, it said, adding, the proposal is also not in conformity with the bye-laws of the bank for allotment of preference shares to an investor who is not a loanee.

User

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)