QBiz: RBI Slams Banks on Poor Compliance; Probe Against CG Power

1. RBI Slams Banks on Poor Compliance

Reserve Bank deputy governor MK Jain Tuesday slammed banks for poor compliance with regulations, and pointed out that high value frauds and fines are a result of their lackadaisical attitude on this. Jain said in some cases, the lack of compliance has been “recurring”, wherein banks have also ignored RBI’s instructions to commit the same mistakes time and again.

“Despite the benefits offered for good compliance culture and the cost of poor conduct, the compliance culture at banks is far from satisfactory,” Jain, the commercial-banker-turned-central-banker, said speaking at the annual industry conference Fibac.

(Source: Financial Express)

2.Lower Prices, Slowing Volumes May Dim Prospects of Nifty Metal Index

Amber signs continue to flash for metal companies. Rising inventory levels in China and subdued metal prices are driving metal stocks south, which could drag the downturn for a long time.

In the last month, the Nifty Metal index lost 14.3%, which was among the highest in the sectoral indices. In the past year, against a fall of about 9% in the Nifty 500 index, the Nifty Metal index lost a whopping 32%.

(Source: LiveMint)

3. As NBFC Crisis Lingers On, SBI Sews up Maiden Co-Origination Pact to Lend to MSMEs

The troubled shadow banks are not yet out of the woods and the largest lender SBI has stitched a co-origination agreement to finance small businesses–which used to be a major customer-base for the crippled financiers,
a top official said Tuesday.

Co-origination is a new system introduced by the Reserve Bank earlier the month in the wake of the liquidity crisis at non-banking finance companies to enhance the credit flow to productive sectors. Fresh credit flow can help both the troubled NBFCs and also help prop up the sagging growth.

(Source: Financial Express)

4. One Year On, Flipkart Acquisition Proves to Be a Mixed Bag for Walmart

As Walmart completes one year of its acquisition of homegrown e-commerce major Flipkart, it has been a mixed bag for the world’s largest retailer.

Experts tracking both the firms say that while the Bentonville-headquartered company has brought in greater synergies leveraging the expertise of Flipkart group companies, the duo may not have been able to exploit the India potential fully. This is mainly due to regulatory hurdles and fierce competition from global rival Amazon.

(Source: Business Standard)

5. MCA Orders Probe Against CG Power, Inspection Report to Be Ready Soon

CG Power and Industrial Solutions is under the lens of the Ministry of Corporate Affairs (MCA), which has ordered an inspection into the affairs of the company, said a senior government official.

The probe was triggered after auditors of the power equipment maker resigned a few months ago.

“The inspection report will be ready soon and appropriate action will be taken,” the senior government official added.

(Source: Business Standard)

6. India Seeks Removal of Restrictions on Trade of Sheesham Wood Products

India has sought a removal of restrictions on trade of products made of sheesham wood under the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) citing its abundant availability in the country.

The Dalbergia genus species, around 200 in total including sheesham and rosewood, was enlisted in the Appendix-II of the CITES in 2016. Items falling under Appendix-II are subject to trade restrictions to check over-utilisation.

(Source: Economic Times)

7. Banks May Seek Consent Before Allowing Transfer of Funds to Your Account

Banks may soon seek your consent before allowing a transfer of funds to your account. The Union government has written to the Reserve Bank of India (RBI), seeking its views on a mechanism to enable willing bank customers to have control over deposits of money in their accounts.

The move is a follow-up to instances of illicit deposits — after demonetisaton — in bank accounts opened under the Pradhan Mantri Jan-Dhan Yojana (PMJDY).

(Source: Business Standard)

8. Centre Revives Plan to Make Hallmarking of Gold Jewellery Mandatory

The centre has revived its intention to make hallmarking mandatory for gold jewellery and plans to notify the regulation in WTO in a week time, a top official said.

Bureau of Indian Standards (BIS) Director General Surina Rajan, however, assured the jewellery traders that the process would be done in consultation with all stakeholders.

"The (central) government once again intends to make hallmarking of gold jewellery mandatory in the country. A notification to WTO is expected in a week time to seek comments," she told PTI.

(Source: Business Standard)

9. Lenders May Be Forced to Convert Rs 4,00,000 Crore of Their DHFL Debt Into Equity: Union Bank

Resolving the crippled mortgage lender DHFL’s over Rs 90,000 crore debt is “not so easy” and banks are considering converting their outstanding into equity, Union Bank of India said Tuesday.

Rajkiran Rai, the managing director and chief executive for the state-run UBI, which is the lead-lender to the crippled housing financier, Tuesday clarified that if the banks take equity stake in the company, it will be for a short
-term, which is till they get a suitor.

(Source: Financial Express)

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