बैं क ऑफ इं डिया /BANK OF INDIA

प्रधान कायाालय / Head Office

आयोजना, कायानीडि एवं आडथाक आसूचना डवभाग
Planning, Strategy & Economic Intelligence Dept

समाचार सारांश /NEWS SUMMARY–04.02.2020

राष्ट्रीय (NATIONAL)

BANK OF INDIA

Bank of India announces December 2019 Q3 financial results (Business Standard)

Shri Atanu Kumar Das (MD & CEO, Bank of India) , Shri C. G. Chaitanya (Executive Director, Bank of India) and
Shri K. V. Raghavendra ( GM & CFO, Bank of India) announced the banks financial results during the press
conference in Mumbai .Net Profit stands at Rs.106 crore, NIM (Domestoc) improves to 3.45%, Non-interest
Income increases by 63.59%, Cost to Income Ratio improves to 37.55%. Global Business of the Bank stood at
Rs. 9,00,825 crore as on December 31, 2019 against Rs. 8,87,931 crore as on December 31, 2018. Domestic
Business stood at Rs. 7,86,192 crore as on December 31, 2019 against Rs. 725,264 crore in December, 2018,
signifying Y-o-Y increase of 8.40%. The overseas business stood at Rs. 1,14,632 crore as on 31st December,
2019 vis a vis Rs. 1,62,667 crore as on 31st December, 2018. CASA Deposits (Domestic) grew by 9.55% YoY
and its share in Domestic deposits improved sequentially qoq from 42.35% in September 2019 to 42.69% in
December 2019.

https://globalnewsonnetwork.com/2020/01/31/bank-of-india-announced-december-2019-q3-fy-2019-20-financial-results-with-net-profit-of-rs-106-crore/

Budget comments of Shri A K Das, Managing Director and CEO, Bank of India (Business Standard)

Union Budged 2020-21 is forward looking in as much as it aims to revive demand and elevate economic growth.
Higher allotment of budget for rural, education and infrastructure pipeline is certain to improve effective demand.
Other feel good elements of the Budget include sizeable increase in DICGC insurance threshold, subordinate debt
facility and extension of restructuring window for MSMEs, liquidity support to NBFCs and Tax holiday in the
affordable housing segment. These, alongwith rationalization of taxes are likely to revive demand and bring about
impetus in the real sector.

https://www.pressreader.com/india/business-standard/20200204/281977494608671

ररजवा बैंक ऑफ इं डिया (RESERVE BANK OF INDIA)

RBI’s Das adjudged top central banker in Asia Pacific (Financial Express)
Reserve Bank of India (RBI) Governor Shaktikanta Das has been named the Central Banker of the Year, Asia-
Pacific 2020, by the Banker magazine, a unit of Financial Times (FT). The award is given to central bankers who
have “best managed to stimulate growth and stabilise their economy.” Jorgovanka Tabakovi, National Bank of
Serbia, was adjudged the winner as the Global Central Banker of the Year. The awards were announced in an
editorial of the Banker magazine on January 2.

https://www.business-standard.com/article/economy-policy/rbi-governor-shaktikanta-das-is-asia-pacific-central-banker-of-the-year-120020301734_1.html

RBI may ask banks to set up cells to monitor large value credit exposures (Business Line)

The Reserve Bank of India is likely to ask banks to set up dedicated cells for market intelligence and monitoring
large credit exposures. This is expected to address issues relating to large divergences observed in asset
classification and provisioning in banks’ credit portfolios vis-à-vis RBI’s supervisory assessments and the rising
incidence of frauds.The central bank may also direct banks to leverage data analytics more to monitor credit
exposures (funded and non-funded). To manage the operational risks inherent in the functioning of banks, the
RBI’s five-member expert committee on non-performing assets and frauds, headed by YH Malegam (former
member of the Central Board of Directors of the RBI), has made these recommendations.

https://www.thehindubusinessline.com/money-and-banking/rbi-may-ask-banks-to-set-up-cells-to-monitor-large-value-credit-exposures/article30728037.ece

बैं डकंग (BANKING)

Reporting of frauds by banks, others (Financial Express)

Frauds involving Rs 1,13,374 crore were reported by banks and select financial institutions in the first half of the
current financial year, Finance Minister Nirmala Sitharaman told Parliament on Monday. In a written reply to a
question in the Lok Sabha, the minister said the government in 2015 had issued 'Framework for timely detection,
reporting, investigation relating to large value bank frauds' for public sector banks (PSBs) to deal with suspected
frauds involving sums of money in excess of Rs 50 crore.

https://economictimes.indiatimes.com/industry/banking/finance/banking/banks-select-financial-institutions-report-frauds-involving-rs-1-13-lakh-crore-in-h1-of-
fy20-nirmala-sitharaman/articleshow/73900818.cms?from=mdr

Page 1 of 3
PSB NPAs at Rs 7.27 lakh crore (Financial Express)

The government on Monday said the Non Performing Assets (NPAs) of Public Sector Banks (PSBs) stood at Rs
7.27 lakh crore as on September 30, 2019. Union Minister of State for Finance Anurag Thakur also said in Lok
Sabha that scheduled commercial banks and select financial institutions have reported frauds to the tune of Rs
1,13,374 crore in the first half of the current financial year.

https://www.news18.com/news/business/npas-of-public-sector-banks-stand-at-rs-7-27-lakh-crore-govt-tells-lok-sabha-2485203.html

Bond market rallies on lack of additional borrowing in FY20 (Financial Express)

Bonds rallied on Monday with the 10-year benchmark yield closing 10 basis points (bps) lower to hit a one-month
low of 6.50%, as market participants cheered the fact that no additional borrowing would be seen in the current
fiscal. The government pegged its net market borrowing for fiscal 2021 at Rs 5.36 lakh crore and the revised
figure for FY20 at Rs 4.99 lakh crore during the Budget. The gross market borrowing for FY21 has been pegged
at Rs 7.8 lakh crore, while for FY20 the revised figure remains unchanged at Rs 7.1 lakh crore.

https://www.financialexpress.com/market/bond-market-rallies-on-lack-of-additional-borrowing-in-fy20/1854918/

Banks may take a 2% hit on bottom line due to hike in deposit cover (Financial Express)

Banks are likely to take a hit of 0.5-2% on their bottom line from the next financial year owing to a fivefold increase
in the fixed deposits cover announced in the Budget, analysts and banking sources told FE. Finance minister
Nirmala Sitharaman on February 1 announced that deposit insurance coverage will be increased from Rs 1 lakh
to Rs 5 lakh for the holders. A Credit Suisse report estimates an increase in the insurance premium of $4 billion
(around Rs 28,400 crore) for the banking system after the announcement.

https://www.financialexpress.com/industry/banking-finance/budget-2020-banks-may-take-a-2-hit-on-bottom-line-due-to-hike-in-deposit-cover-
banking/1855068/

IDBI Bank raises Rs 745 crore through Basel-III bonds (Financial Express)

LIC-owned IDBI Bank on Monday said it has raised Rs 745 crore through issue of Basel III compliant tier 2 bonds
which will help improve its capital position. The 10-year bond was priced at a coupon rate of 9.50 per cent per
annum payable annually, the bank said in a statement.

https://economictimes.indiatimes.com/markets/stocks/news/idbi-bank-raises-rs-745-crore-through-basel-iii-bonds/articleshow/73911530.cms?from=mdr

PNB to raise Rs 1,000 crore by issuing Basel-III bonds (Financial Express)

Punjab National Bank on Monday said it has got nod from its board to raise up to Rs 1,000 crore by issuing Basel
III compliant bonds. The Board of the Bank in its meeting held on Monday has granted permission for raising
funds through issuance of Basel-III compliant Tier-II bonds amounting up to Rs 1,000 crore in one or more
tranches.

https://www.business-standard.com/article/pti-stories/pnb-board-gives-nod-to-raise-rs-1-000-cr-by-issuing-basel-iii-bonds-120020301494_1.html

L V Prabhakar takes charge as Canara Bank MD & CEO (Financial Express)

L V Prabhakar has assumed office as the Managing Director and Chief Executive Officer of Canara Bank. Prior to
his appointment as the MD & CEO of Canara Bank, he was Executive Director at Punjab National Bank. He
spearheaded the recovery efforts of the crisis-hit bank.

UPI volumes fall m-o-m in December, value grows to Rs 2.16 lakh crore (Financial Express)

The value of transactions through the Unified Payments Interface (UPI) rose 6.78% month-on-month to `2.16 lakh
crore, even as the volumes dipped marginally by 0.26% to 1305.02 million. According to data from the National
Payments Corporation of India (NPCI), BHIM app accounted for transactions worth Rs 6,611.22 crore and 18.54
million transactions in volume terms. The first-mover in the UPI space now accounts for just 1.42% of the volume
as of January 20.

https://www.financialexpress.com/market/upi-volumes-fall-month-on-month-in-december-value-grows-to-rs-2-16-lakh-crore-markets/1855061/

PNB seeks IRDAI’s forbearance for paring stake in Canara HSBC OBC Life (Financial Express)

State-owned Punjab National Bank is seeking IRDAI forbearance on cutting down stake in Canara HSBC OBC
Life Insurance, which will come to the lender's fold after its merger with Oriental Bank of Commerce (OBC),
sources said. OBC currently holds 23 per cent stake in Canara HSBC OBC Life Insurance. Besides, another
public sector lender Canara Bank has 51 per cent stake and HSBC Insurance (Asia Pacific) Holdings Limited as
foreign partner owns 26 per cent. As per the extant guidelines, one promoter cannot hold more than 10 per cent
stake in two insurance ventures, sources said.

Page 2 of 3
https://economictimes.indiatimes.com/industry/banking/finance/banking/pnb-seeks-irdai-forbearance-for-paring-stake-in-canara-hsbc-obc-
life/articleshow/73903626.cms?from=mdr

Results were largely in line with estimates (Financial Express)

State Bank of India Rating: Buy. Results were largely in line, with core profits boosted by lumpy recoveries from
NCLT. Higher tax expense was due to deferred tax asset reversal as SBIN moves to lower corporate tax rate.
Margins (ex-of one time recovery) were stable at ~2.87%, loan growth driven by retail (+17.5% y-o-y). Net
stressed assets stood at 3.5%, credit costs could remain volatile in near term. Still, valuations are fairly attractive
at 1.1x fwd P/B. Retain Buy, PT Rs 390.

https://www.financialexpress.com/market/state-bank-of-india-rating-buy-results-were-largely-in-line-with-estimates/1854774/

Tax outgo of merged state-run Banks, General Insurers to see substantial fall (Economic Times)

The Union budget has allowed carry forward of losses and depreciation for state-run banks and general insurance
companies that are being merged, a move that would substantially reduce tax outgo of recently merged state
banks. Banks are allowed to carry forward depreciation and net loss in their books for up to eight years, and use
them to offset their future profits and pay lower tax. However, as per the current regulations, in the event of a
merger they cannot take either depreciation or loss on the books of the merged entity, experts said.

https://economictimes.indiatimes.com/industry/banking/finance/banking/tax-outgo-of-merged-state-run-banks-general-insurers-to-see-substantial-
fall/articleshow/73921169.cms?from=mdr

Bank credit grows by 7.21%, deposits 9.51%: RBI data (Business Standard)

Banks credit and deposits grew 7.21 per cent and 9.51 per cent to Rs 100.05 trillion and Rs 131.26 trillion,
respectively, in the fortnight ended January 17, according to the latest Reserve Bank data. In the year-ago
fortnight, banks advance stood at Rs 93.32 trillion while deposits at Rs 119.85 trillion. In the previous fortnight
ended January 2, credit had grown by 7.57 per cent to Rs 100.44 trillion and deposits by 9.77 per cent to Rs
132.10 trillion. Non-food bank credit growth decelerated to 7 per cent in December 2019 from 12.8 per cent in
December 2018.

https://www.business-standard.com/article/pti-stories/banks-credit-grows-by-7-21-deposits-9-51-rbi-data-120020301337_1.html

Indian Bank posts 62% rise in Q3 net (Business Standard)

State-owned lender Indian Bank posted a 62.3% rise in December quarter net profit to Rs 247 crore. The bank
had posted a profit of Rs 152.2 crore in same period last year. Asset quality was stable for the quarter, with gross
non-performing assets as a percentage of gross advances coming at 7.2% versus 7.46% same time a year ago.
Net NPA dropped 90 basis points over last year to 3.5%. Provisions spiked sharply up 65.5% to Rs 1,529.2 crore
for the quarter ended December 2019. It had set aside Rs 923 crore as provisions during the same period last
year.

https://economictimes.indiatimes.com/markets/stocks/news/indian-bank-net-up-62-at-rs-247-crore/articleshow/73601381.cms?from=mdr

Coming soon: Capital adequacy, managerial norms for co-operative banks (Business Line)

Call this a fallout of the Punjab & Maharashtra Co-operative Bank (PMC Bank) crisis and other failures in the co-
operative banks segment in recent years. The Centre plans to put in place a robust regulatory system governing
multi-state cooperative and urban cooperative banks, said Finance Secretary Rajiv Kumar. On the anvil are
specific capital adequacy norms for such banks besides management norms, including qualifications for directors,
managing directors and no conflict of interest in their appointments. The proposed norms will aslo cover loan size,
single party and group exposure for lending by these banks.

https://www.thehindubusinessline.com/money-and-banking/coming-soon-capital-adequacy-managerial-norms-for-co-op-banks/article30727385.ece

अथाव्यवस्था (Economy)

Rupee settles 3 paise down vs dollar (Business Line)

The rupee pared early losses to settle 3 paise down at 71.35 against the US dollar on Monday, tracking recovery
in domestic equities and easing crude oil prices. Besides, the domestic unit weakened amid concerns of fiscal
slippage and rising coronavirus outbreak fears, forex traders said. The next trigger for the currency will be the
Reserve Bank of India's monetary policy meeting, as its commentary on inflation as well as growth forecast would
be keenly watched. At the interbank foreign exchange market, the local currency opened at 71.62. During the day,
it saw a high of 71.32 and a low of 71.66. The domestic unit finally settled at 71.35, up 3 paise over its previous
close.

https://www.moneycontrol.com/news/business/rupee-settles-3-paise-down-at-71-35-against-us-dollar-4899101.html

***********
Page 3 of 3