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According to RBI survey, foreign banks operating in India generated more income from fee-based business like derivatives, stock, securities, foreign exchange trading services and financial consultancy or advisory services
Foreign banks operating in India are generating more fee-based income from derivatives, stock, securities, and foreign exchange trading services and financial consultancy or advisory services, says a study conducted by the Reserve Bank of India (RBI)
The survey on ‘International Trade in Banking Services’ (2012-2013) shows a study on Indian banks’ branches and subsidiaries operating outside the country as well as the foreign banks operating in India.
The survey reveals that, the Indian banks’ branches, which originated outside India, generated their major share of fee income by rendering credit-related services and trade finance-related services. However,
Findings of the Survey on International Trade in Banking Services:
Employment Distribution and Growth
Credit and Deposit Growth
Income and Expenditure
Fee Income Generated
Country-wise Banking Services
Bahrain, Belgium, Hong Kong, Japan, Singapore, Sri Lanka, UAE, UK and USA were the major countries which together accounted for nearly 92.2% of the total banking services of the branches of Indian banks operating abroad.
The survey covered 170 overseas branches, 184 overseas subsidiaries of Indian Banks and 316 branches of foreign banks operating in India.
RBI said that it has done the survey with the intention of providing information on International trade in banking services (ITBS) of India. RBI has released the survey results including statistical data in tabular format to provide consistent and comparable data which are captured on financial auxiliaries’ services rendered by the banks based on explicit, implicit fees and commission charged to customers.
According to NPAsource.com, almost 11 banks out of 40 posted a 50% plus growth in their gross NPAs during the nine months that ended on 31 December 2013
Gross non-performing assets (NPAs) or bad loans of 40 listed banks increased 35.2% or by Rs63,386 crore to over Rs2.4 lakh crore during the December 2013 quarter. This jump of 35.2% was much higher than the 27% witnessed during the first six months of financial year 2013-14, says NPAsource.com.
According to a study conducted by the portal, 10 out of the 40 listed banks accounted for nearly 70% of the total gross NPAs of Rs2.43 lakh crore. State Bank of India (SBI) at 28% or Rs67,799 crore has the largest share in the total gross NPAs of the 40 listed banks, followed by Punjab National Bank (PNB) with 7% share at Rs16,596 crore. Bank of Baroda and Central Bank of India, both have 5% share each in the NPAs.
As of 31 December 2013, Bank of Maharashtra posted the largest increase in gross NPAs of 209% to Rs3,516 crore from Rs1,138 crore as on March 2013. United Bank of India also reported a 188% jump in its gross NPAs at Rs8,546 crore at end of December quarter. Almost 11 banks posted a 50% plus growth in their gross NPAs for the nine months ending 31 December 2013, NPAsource.com said.
"The fourth quarter of 2013-14 will continue to be bad for banks on the NPAs front, but most banks will resort to higher levels of provisioning so as to bring down their net NPA levels. The first quarter of next financial year too will continue to be bad for banks with regard to NPAs. The high concentration of banks’ debt to the top 50-100 corporates is also a major concern area. A clearer picture about the future of the Indian economy will emerge post the central elections due in May," said Devendra K Jain, chairman and managing director of Atishya Group that owns NPAsource.com.
The growth in net NPAs at 49% for the nine months ended 31 December 2013 as against a 38% rise in the first six months of 2013-14 is also alarming. Net NPAs have gone up to Rs1.38 lakh crore as of December end from Rs93,116 crore at end of March 2013.
"There is no respite for banks in India from the onslaught of higher interest rates and slowdown in the Indian economy leading to further increase in loans turning bad from corporate as well as retail segments,” Jain added.
NPAsource.com said gross NPAs of listed banks have doubled since September 2011; while net NPAs have risen by 2.4 times or 140% during the same period.