Banking and Financial Awareness March 2019: Week III

1. Korea Exim Bank has extended loan worth Rs. 4,100 crores for Vizag Metro

• The State government had sent a proposal to Central government for asking KEXIM Bank to provide loan at 8-10% rate of interest.
• The estimated cost of the project is Rs. 8300 crores and it constitutes 3 corridors spread over 42 km.

2. Insolvency and bankruptcy board has inked cooperation agreement with IFC

• The agreement will enable IFC to assist IBBI further build the capacity of insolvency professionals, and insolvency professional agencies for the purposes of the code.

3. SBI linked savings account, short-term loan interest rates to RBI repo rate

• The bank will link savings accounts with balance greater than Rs. 1 lakh to repo rate at current effective rate of 3.5% (2.75 percentage points lower than the current repo rate of 6.25%).
• A risk premium, above 8.5%, will be charged on these loans on the basis of the risk profile of the borrower.
• All cash credit accounts and overdrafts having limits greater than Rs. 1 lakh shall also be linked to the benchmark policy rate, plus a spread of 2.25%—amounting to 8.5%.
• The interest rate on home loans will continue to be determined by MCLR (marginal cost of funds-based lending rate).

4. Punjab National Bank has sanctioned loans of worth Rs 689 cr to 1600 MSMEs via online portal

• It has sanctioned through psbloanin59minutes.com as a part of its effort to promote such industries.
• Under the Pradhan Mantri Mudra Yojana (PMMU), the bank has sanctioned loan to over 17.16 lakh accounts with total amount of Rs. 21,019 crores from the starting of the scheme till December 31, 2018.

5. Bank of Baroda became the first PSBs to launch creche/day-care facility for employees’ children

• It has been launched at its Mumbai corporate office in Bandra Kurla Complex and is being mulled further on being implemented at the head office in Vadodara, Gujarat.
• The bank will bear 60% of the cost incurred every month and rest 40% will be borne by the parents.

6. HDFC became the third Indian company to achieve a market value of more than Rs.6 trillion

• It became the only third Indian firm after Tata Consultancy Services Ltd (TCS) and Reliance Industries Limited (RIL).
• The banks share have risen in each of the last five trading sessions, capping a 6% jump to a record high of Rs. 2,227.40.
• The bank has witnessed a 20% growth in profits and a bad loan ratio of less than 1.5%.

7. India has provided financial support of USD 250 million to Nepal for reconstruction of infrastructures after earthquake

• It has been provided to reconstruct infrastructure in fields of housing, education, health and cultural heritage, which had been ruined by the earthquake that took place on April 2015.
• India would also provide a supporting hand in reconstructing 72 education facilities in Nepal that were ruined due to earthquake.

8. Fresh Liquidity Infusion Through Forex Swaps announced by RBI

• The Reserve Bank of India (RBI) has decided to use a new tool for the first time to enhance liquidity in the system
• Banks will have to deposit dollar funds with RBI with the condition of buying them back from RBI after 3 years.
• The first-ever auction of this kind involving US dollar buy/sell swap will happen on 26th March 2019.

9. Bank of India have raised Rs. 660 crores via sale of shares to employees

• It has been raised under Employee Share Purchase Scheme (ESPS).
• 6,25,52,188 shares worth Rs 10 each were issued by the bank to its eligible employees.
• A discount of 24.28% on the applicable price was offered by the bank to its employees.
• The scheme witnessed a participation of around 94.70% of total employees.
• The shares have been issued with a lock-in period of one year.

10. Doorstep Banking for Senior Citizens, Differently-Abled And Infirm Persons has been introduced by SBI

• The person to avail the benefit should have a KYC-compliant account, having one’s mobile number registered with the bank, and being domiciled within a five-kilometer radius of one’s home branch.
• Cost for availing these services would be Rs 100 for each financial transaction and Rs 60 for each non-financial transaction. Those aged above 70 years would be treated as senior citizens for the facility.
• Cash pickup and delivery, cheque pickup, cheque book requisition slip pickup, delivery of drafts and term deposit advice, life certificate pick-up and pickup of form 15H which is used for Income tax reasons will be provided at doorstep.

11. IDBI Bank has been categorized as Private Sector Lender by RBI

• The Reserve Bank of India has categorized IDBI Bank as a Private Sector Bank with effect from January 21, 2019 following Life Insurance Corporation of India (LIC) is acquiring 51 per cent of the total paid-up equity share capital of the bank.

12. Karur Vysya Bank have raised Rs 487 crore through private placement of Tier II bonds

• The decision was taken in the Capital Raising Committee of the board.
• The committee allotted 48,700 BASEL-III compliant unsecured, redeemable, non-convertible tier-II bonds of Rs 1,00,000 each, totalling to Rs 487 crore and the capital raising was done on private placement basis.
• The instrument would be listed on NSE.

13. SBI, ICICI and HDFC has been named as Systemically Important Banks by RBI

• D-SIB inclusion indicates that the failure of these banks would have a steep fall on Indian financial system.
• The banks are required to set aside more capital for their continued operation as per the norms by April 1.
• It will give more comfort to investors as the borrowing cost of these banks from the markets are cheaper than its peers.

14. SBI has introduced “YONO Cash” for cardless ATM withdrawal

• The facility is available over 16,500 of its ATMs through the You Only Need One (YONO), mobile app platform for the first time in the country.
• The ATMs enabled for this service will be called as YONO Cash Point.
• Customers can initiate the cash withdrawal process on the YONO app and set a six-digit YONO Cash pin for the transaction. They will get a six-digit reference number for the transaction on their registered mobile number via SMS, which has to be used within 30 minutes at the nearest YONO cash point.
• Transactions using YONO will be secured with two-factor authentication and will also eliminate the risk of skimming and cloning, at the same time it also maximizes convenience and enhances the banking experience for its customers.

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