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☕ 03.04.2020: Today's Banking / Financial News at a Glance
ЁЯНТ Chief executives of Oriental Bank of Commerce, United Bank of India designated as OSD in PNB : The government has designated chief executives of Oriental Bank of Commerce (OBC) and United Bank of India (UBI) as "officers on special duty" in Punjab National Bank (PNB) following the merger of these three lenders. They are not assigned any portfolio so far. On the other hand, Andhra Bank and Syndicate Bank CEOs retired on March 31, the day these banks ceased to exist, in the absence of any government communication, people familiar with the development said.The fact that all of them had less than a year left in their service raised doubts on the criteria of such decision."It is unfortunate the way the government handled this issue," one top bank executive said.OBC chief executive Mukesh Kumar Jain, who is now in PNB will be retiring in July. UBI chief executive Ashok Kumar Pradhan will be retiring at the end of May from PNB. Syndicate Bank CEO Mrutyunjay Mahapatra had two months left in the service while Andhra Bank chief J Packirisamy had 10 months. Corporation Bank chief executive PV Bharathi retired on March 31 which coincided with her scheduled superannuation day. Meanwhile, the government transferred UBI executive director Ajit Kumar Das to Punjab & Sind Bank while Sanjay Kumar has moved to PNB as ED subsequent of the merger. Similarly, Allahabad Bank executive director K Ramachandran has moved to Indian Bank. Another Allahabad Bank executive director PR Rajagopal has been appointed as ED in Bank of India. - Economic Times
ЁЯНТ IBA directs banks to remit Rs 500/month in women Jan Dhan a/cs from April 3 : The Indian Banks' Association (IBA) on April 2 directed banks to start depositing Rs 500 per month in the accounts held by women under the Pradhan Mantri Jan Dhan Yojana (PMJDY). The remittance under the recently announced Pradhan Mantri Garib Kalyan Yojana will be credited between April 3 and April 9, IBA said in a statement. The transfer of the monthly remittance will take place in a staggered fashion to ensure social distancing. The said amount will be transferred into the account of beneficiaries for the next three months (i.e. April, May and June). The directive is based on the recent announcement made by Finance Minister Nirmala Sitharaman to ease the stress of the sections worst hit by the novel coronavirus, or COVID-19, pandemic in India. The IBA has charted out a schedule to be followed by banks while depositing money into the Jan Dhan accounts of women in order to ensure an orderly withdrawal of money. The same will be disbursed into the accounts as per the last digit of the PMJDY account numbers of women. Those with 0 or 1 as the last digits of their Jan Dhan account numbers will be able to withdraw the money from April 3 onwards. Similarly in case of accounts with 2 or 3 as the last digits, the date of withdrawal is April 4. Account holders with 4 or 5 as the last digits can withdraw the monthly remittance on April 7, while those with 6 or 7 can withdraw the same on April 8. Lastly, women whose account numbers end with digits 8 or 9 can access the money on April 9.The IBA said in the statement that there is no need for beneficiaries to rush for withdrawal as the money is being deposited into their bank accounts and can be accessed by them at their convenience. "And after April 9th, beneficiaries may withdraw on any day at per their convenience," it added. - Moneycontrol.com
ЁЯНТ PNB expects Rs 5,000-crore fresh slippages in Q4; no lay-off post merger, says MD & CEO Mallikarjuna Rao: State-run Punjab National Bank (PNB) expects fresh slippages of an estimated Rs 5,000 crore in the fourth quarter, said S S Mallikarjuna Rao, Managing Director and Chief Executive Officer of the bank, in an exclusive interview with Moneycontrol. This would include an estimated Rs 1,800 crore slippages on account of the COVID-19 impact on industries, Rao said. That apart, post the amalgamation of United Bank of India and Oriental Bank of Commerce, PNB expects about Rs 2,500 crore additional slippages to come from both these entities. According to Rao, about 75 percent of the fresh slippages are likely to come from the SME (small and medium enterprises) and retail portfolios in the Q4. The scenario on loan growth and future asset quality depends on how long the COVID-19 impact will be felt on the economy, Rao said. As per the amalgamation document, all the employees of merged banks are employees of PNB as on April 1. However, we have opened a window. That is, if somebody doesn’t wish to continue he/she can opt for that. My understanding, so far, is no one wishes to leave the bank. - Moneycontrol.com
ЁЯНТ RBI rejects lenders' call for asset classification pause : The Reserve Bank of India (RBI) has rejected requests for standstill in asset classification from banks, dashing the hopes of lenders as well as companies seeking to avoid the defaulter tag. The move is also likely to increase the burden of bad loans on the books of banks. In an email to the Indian Banks’ Association, the regulator has said that no question of forbearance arises as these companies have been under default even before March 1, 2020, after which the Covid-19 pandemic started spreading in the country. “If a borrower has been in default even before March 1, 2020, such a default cannot be said to be as a result of the economic fallout of the pandemic,” the regulator said. “The benefit of moratorium can be extended to such borrowers in respect of payments falling due during the March 1 to May 31, 2020 period. However, the payments overdue on or before February 29, 2020 will attract current IRAC (income recognition and asset classification) norms.” ET in its edition on April 1 had reported that Indian banks were seeking a freeze on recognition of bad loans as on February 29 to make the regulator’s loan moratorium rules more effective. - Economic Times
ЁЯНТ 34 lakh transactions effected via Post Office Savings Bank, 6.5 lakh through IPPB during lockdown : As many as 34 lakh transactions took place through Post Office Savings Bank and 6.5 lakh transactions through India Post Payments Bank, during the lockdown period as on March 31. Online medicine company netmeds.com and e-commerce company Amazon have also approached India Post for delivery of medicine and essential commodities in metros and some other locations, an official release said. "During the lockdown period as on 31.03.2020, 34 lakh transactions were effected through POSB (Post Office Savings Bank) and 6.5 lakh transactions were effected through IPPB (India Post Payments Bank). Around 2 lakh accountable mails including speed post registered letters, parcels and money-orders were delivered," it said.Mobile Post Offices are functioning in Kerala, Telengana, Uttar Pradesh, Delhi and some other circles to provide essential postal and financial services. The routes of these mobile post offices are decided depending upon requirements, the statement said. - Economic Times
ЁЯНТ Small savings rate cuts make banking & PSU debt funds attractive : Investors looking for higher returns post the sharp cut of interest rates in small savings products and bank deposits by up to 140 basis points could turn to banking and PSU debt funds. These funds could give investors 6.5-7.5%, thereby helping them earn 50-150 basis points higher than small savings products. For those in the high tax bracket, if they hold these funds for more than three years, these products will also get indexation benefits, which will significantly improve the post-tax returns. Post the repo cut of 90 basis points by RBI, the government reduced interest rate on 1-, 2- and 3-year time deposits from 6.9% to 5.5% and on Public Provident Fund by 80 basis points to 7.1%. - Economic times
ЁЯНТ RBI raises short-term borrowing limit for states and UTs by 30% : The Reserve Bank of India has come up with another round of measures to cushion the impact of the Covid-19-induced shutdown with a focus on the finances of the states, some of which have announced staggered payment of salaries. States’ short-term borrowing limits have been increased by as much as 30% as they face pressure on revenues with economic activity coming to a halt and the transfers from the Central government also getting crushed due to lower Goods and Services Tax collection.Banks, which are bearing the brunt of the moratorium announced last week, would get some reprieve in meeting regulatory norms in respect to the capital needs, the central bank said in a statement. “It has been decided to increase WMA (ways and means advances) limit by 30% from the existing limit for all states/UTs (Union territories) to enable the state governments to tide over the situation arising from the outbreak of the Covid-19 pandemic,” the Reserve Bank said in a release. The revised limits came into force on April 1, 2020 and will be valid till September 30, 2020. - Economic Times
ЁЯНТ HDFC Group pledges Rs 150 crore support to PM-Cares Fund : Financial services conglomerate HDFC Group on Thursday said it has committed Rs 150 crore to the PM-Cares Fund to support the government for its relief and rehabilitation measures towards the Covid-19 pandemic. "These are uncertain and trying times for all of us. The HDFC Group's support to the PM Cares Fund is to commend the exemplary efforts of the Central & State governments, armed and paramilitary forces, local police, healthcare professionals and sanitation workers across the country, who are working tirelessly day in and out to fight the pandemic," HDFC Ltd chairman Deepak Parek said in a statement. The Prime Minister's Citizen Assistance and Relief in Emergency Situations Fund (PM-Cares Fund) was set up on March 28 to raise money for combating coronavirus outbreak and to provide relief to the affected. - Economic Times
ЁЯНТ RBI director Marathe presses for bold initiatives to revive MSME sector, amid COVID-19 crisis : The government and the Reserve Bank need to come out with a bold and comprehensive package to help small and medium enterprises tide over the unprecedented crisis created by COVID-19, said veteran co-operator and RBI central board director Satish Marathe. Piecemeal initiatives will not help the industry as “this is an exceptional crisis and warrants exceptional response,” Marathe told PTI. The coronavirus crisis is likely to end in the next three to six months, but the industry, which bore the brunt of slowdown during 2019, will take much longer to recover, he said. Referring to the recent measures announced by the government and the RBI to mitigate the impact of the pandemic, he said, these are only for short term and may not yield the desired results as the problem is severe and has been further aggravated by the lockdown. - Moneycontrol.com
ЁЯНТ Covid-19 Impact: Banks to feel capital pinch as asset quality to take hit : The 21-day nationwide lockdown to contain the spread of coronavirus (covid-19) leading to sluggish economic growth and the consequent rise in provisions for bad loans will exert pressure on the capital adequacy of banks, ratings agencies have warned. The impact will be more pronounced for public-sector banks (PSBs), where the Centre has not proposed any capital infusion for the financial year started 1 April and expects them to tap markets for funds. Ratings agency Moody’s Investors Service went to the extent of revising the outlook for the Indian banking system to negative from stable earlier.According to Moody’s, surge in loan loss provisions along with a decline in revenue will hurt the profitability of banks, causing a deterioration of capitalisation. It said if the government makes more capital infusions into PSBs, as it had in the past few years, it will mitigate capital pressure for them. “However, the government so far has not announced any new plan to provide capital support to PSBs. Most rated private sector banks will maintain strong capital buffers," it said. - Live Mint
ЁЯНТ Covid-19 relief: SBI relaxes payment timeline for one time settlement : State Bank of India (SBI) has extended the timeline for payment of settlement amount under its one-time settlement scheme by three months. Now, customers on board the scheme, SBI OTS 2019 / Rin Samadhan 19-20 / General compromise, can meet payment obligation by June 30, 2020. Under One Time Settlement (OTS) 2019, the extension will be available if the first two instalments of 5 per cent/15 per cent, and 20 per cent/25 per cent have been received within stipulated time of 30 days and 60 days respectively. The balance OTS amount can be paid by June 30, 2020. Bank will not charge any interest on the amount for this extended period. Similarly, under Rin Samadhan, the timeline for receipt of acceptance of the OTS proposal along with upfront payment from borrowers has been extended up to June 30, 2020, from the current March 31, 2020, and up to September 30, 2020, for recovery of entire OTS amount. This will provide an extended opportunity to borrowers who are unable to visit branches owing to the lockdown. - Business Standard
ЁЯНТ RBI moratorium on term and working capital loans may hurt business : The moratorium granted by the Reserve Bank of India (RBI), both on term and working capital loans, to provide a helping hand to corporates and customers struggling with inadequate liquidity, may become a cause for concern for them later. Under the RBI scheme, there is a three-month moratorium on the interest payment on working capital loans.So, after the end of three months, the deferred interest (of three months) will be collected immediately after the moratorium ends. Hence, corporates may end up paying four months interest on their loans together. This could come as a blow to companies, given the current situation. C S Setty, MD at SBI, told the media on Wednesday that if anyone is unable to pay the amount after the moratorium period, it will not immediately impact the asset quality though the account will become special mention account 1 (SMA 1). - Business Line
ЁЯНТ Covid-19 impact: Axis Bank offers EMI deferment on loans for 3 months : Axis Bank has offered its customers to opt for the loan moratorium if they face problem is keeping their EMIs running, in line with actions of its peers. “In the wake of the Reserve Bank of India’s guidelines on the Covid-19 Regulatory Package, we are now offering you the flexibility to opt for a moratorium/deferment, Axis Bank said in a tweet. Customers can opt for moratorium on payment of installments and interest for various term loans/credit card dues, and/or defer the interest for working capital facilities due between March 1, 2020 and May 31, 2020, it said. - Business Line
ЁЯНТ ICRA expects stressed assets of banks, NBFCs to jump in FY21 : tressed assets of banks and non-banking financial companies (NBFCs) could spike in FY21, despite the three-month moratorium provided by the Reserve Bank of India to borrowers on their loan repayments, warned credit rating agency ICRA. It reasoned that with the fall in economic activity, debt servicing ability of borrowers could be impacted. Underscoring that Covid-19 and its aftermath will affect many businesses, the agency said the SME (small and medium enterprise) and retail segments will be more affected than the corporate segment. Resumption of timely repayments after moratorium, which only provides near-term respite, remains suspect, especially for the unorganised segments with limited alternative funding avenues, it added. - Business Line
ЁЯНТ Covid-19: SBI Cards offers moratorium on credit card dues : Close on the heels of the RBI’s Covid-19 package, SBI Cards and Payment Services has given its cardholders the option to avail a moratorium on their credit card dues. The moratorium period is of three months, for making payment of credit card outstanding balance/EMIs which are due between March 1 and May 30 this year, as well as the entire outstanding amount, including the applicable interest and charges (other than late payment charge) during this period, as per the cardholder’s June 2020 payment due date. For EMI payments, there will be no extension of tenure. Any account which was in current status (non-delinquent with no overdues) as on February 29 would be eligible for the moratorium, SBI Cards has said. - Business Line
ЁЯНТ Arogya Sanjivani will cover Covid-19 hospitalisation charges, says IRDAI : The Insurance Regulatory and Development Authority of India (IRDAI) has said Arogya Sanjivani, a newly launched standard health insurance product, will cover hospitalisation charges to treat coronavirus infection. The regulator has also approved 29 general and health insurance companies to market Arogya Sanjivani. These include Raheja QBE General Insurance, New India Assurance, Bajaj Allianz General Insurance and United India Assurance, among others. “…the product Arogya Sanjeevani, offered by the above general and health insurers, also covers the hospitalisation treatment costs of Covid-19,” it said. - Business Line
ЁЯНТ Covid-19: Date for renewal of health, motor insurance policies extended to April 21 : The government has provided relief for third-party motor insurance and health policy holders in the light of the Covid-19 lockdown. The renewal dates of health and motor insurance policies which fall during the period March 25, 2020 to April 14, 2020 are now extended till April 21, 2020 due to the coronavirus lockdown, according to notifications issued by the Finance Ministry. This would mean that existing policies which fall due for renewal from March 25 to April 14, can be renewed up to April 21, an official release said. - Business Line..
Have a Good day.." ЁЯМ╗ЁЯСйЁЯСйЁЯСзЁЯСж
☕ 03.04.2020: Today's Banking / Financial News at a Glance
ЁЯНТ Chief executives of Oriental Bank of Commerce, United Bank of India designated as OSD in PNB : The government has designated chief executives of Oriental Bank of Commerce (OBC) and United Bank of India (UBI) as "officers on special duty" in Punjab National Bank (PNB) following the merger of these three lenders. They are not assigned any portfolio so far. On the other hand, Andhra Bank and Syndicate Bank CEOs retired on March 31, the day these banks ceased to exist, in the absence of any government communication, people familiar with the development said.The fact that all of them had less than a year left in their service raised doubts on the criteria of such decision."It is unfortunate the way the government handled this issue," one top bank executive said.OBC chief executive Mukesh Kumar Jain, who is now in PNB will be retiring in July. UBI chief executive Ashok Kumar Pradhan will be retiring at the end of May from PNB. Syndicate Bank CEO Mrutyunjay Mahapatra had two months left in the service while Andhra Bank chief J Packirisamy had 10 months. Corporation Bank chief executive PV Bharathi retired on March 31 which coincided with her scheduled superannuation day. Meanwhile, the government transferred UBI executive director Ajit Kumar Das to Punjab & Sind Bank while Sanjay Kumar has moved to PNB as ED subsequent of the merger. Similarly, Allahabad Bank executive director K Ramachandran has moved to Indian Bank. Another Allahabad Bank executive director PR Rajagopal has been appointed as ED in Bank of India. - Economic Times
ЁЯНТ IBA directs banks to remit Rs 500/month in women Jan Dhan a/cs from April 3 : The Indian Banks' Association (IBA) on April 2 directed banks to start depositing Rs 500 per month in the accounts held by women under the Pradhan Mantri Jan Dhan Yojana (PMJDY). The remittance under the recently announced Pradhan Mantri Garib Kalyan Yojana will be credited between April 3 and April 9, IBA said in a statement. The transfer of the monthly remittance will take place in a staggered fashion to ensure social distancing. The said amount will be transferred into the account of beneficiaries for the next three months (i.e. April, May and June). The directive is based on the recent announcement made by Finance Minister Nirmala Sitharaman to ease the stress of the sections worst hit by the novel coronavirus, or COVID-19, pandemic in India. The IBA has charted out a schedule to be followed by banks while depositing money into the Jan Dhan accounts of women in order to ensure an orderly withdrawal of money. The same will be disbursed into the accounts as per the last digit of the PMJDY account numbers of women. Those with 0 or 1 as the last digits of their Jan Dhan account numbers will be able to withdraw the money from April 3 onwards. Similarly in case of accounts with 2 or 3 as the last digits, the date of withdrawal is April 4. Account holders with 4 or 5 as the last digits can withdraw the monthly remittance on April 7, while those with 6 or 7 can withdraw the same on April 8. Lastly, women whose account numbers end with digits 8 or 9 can access the money on April 9.The IBA said in the statement that there is no need for beneficiaries to rush for withdrawal as the money is being deposited into their bank accounts and can be accessed by them at their convenience. "And after April 9th, beneficiaries may withdraw on any day at per their convenience," it added. - Moneycontrol.com
ЁЯНТ PNB expects Rs 5,000-crore fresh slippages in Q4; no lay-off post merger, says MD & CEO Mallikarjuna Rao: State-run Punjab National Bank (PNB) expects fresh slippages of an estimated Rs 5,000 crore in the fourth quarter, said S S Mallikarjuna Rao, Managing Director and Chief Executive Officer of the bank, in an exclusive interview with Moneycontrol. This would include an estimated Rs 1,800 crore slippages on account of the COVID-19 impact on industries, Rao said. That apart, post the amalgamation of United Bank of India and Oriental Bank of Commerce, PNB expects about Rs 2,500 crore additional slippages to come from both these entities. According to Rao, about 75 percent of the fresh slippages are likely to come from the SME (small and medium enterprises) and retail portfolios in the Q4. The scenario on loan growth and future asset quality depends on how long the COVID-19 impact will be felt on the economy, Rao said. As per the amalgamation document, all the employees of merged banks are employees of PNB as on April 1. However, we have opened a window. That is, if somebody doesn’t wish to continue he/she can opt for that. My understanding, so far, is no one wishes to leave the bank. - Moneycontrol.com
ЁЯНТ RBI rejects lenders' call for asset classification pause : The Reserve Bank of India (RBI) has rejected requests for standstill in asset classification from banks, dashing the hopes of lenders as well as companies seeking to avoid the defaulter tag. The move is also likely to increase the burden of bad loans on the books of banks. In an email to the Indian Banks’ Association, the regulator has said that no question of forbearance arises as these companies have been under default even before March 1, 2020, after which the Covid-19 pandemic started spreading in the country. “If a borrower has been in default even before March 1, 2020, such a default cannot be said to be as a result of the economic fallout of the pandemic,” the regulator said. “The benefit of moratorium can be extended to such borrowers in respect of payments falling due during the March 1 to May 31, 2020 period. However, the payments overdue on or before February 29, 2020 will attract current IRAC (income recognition and asset classification) norms.” ET in its edition on April 1 had reported that Indian banks were seeking a freeze on recognition of bad loans as on February 29 to make the regulator’s loan moratorium rules more effective. - Economic Times
ЁЯНТ 34 lakh transactions effected via Post Office Savings Bank, 6.5 lakh through IPPB during lockdown : As many as 34 lakh transactions took place through Post Office Savings Bank and 6.5 lakh transactions through India Post Payments Bank, during the lockdown period as on March 31. Online medicine company netmeds.com and e-commerce company Amazon have also approached India Post for delivery of medicine and essential commodities in metros and some other locations, an official release said. "During the lockdown period as on 31.03.2020, 34 lakh transactions were effected through POSB (Post Office Savings Bank) and 6.5 lakh transactions were effected through IPPB (India Post Payments Bank). Around 2 lakh accountable mails including speed post registered letters, parcels and money-orders were delivered," it said.Mobile Post Offices are functioning in Kerala, Telengana, Uttar Pradesh, Delhi and some other circles to provide essential postal and financial services. The routes of these mobile post offices are decided depending upon requirements, the statement said. - Economic Times
ЁЯНТ Small savings rate cuts make banking & PSU debt funds attractive : Investors looking for higher returns post the sharp cut of interest rates in small savings products and bank deposits by up to 140 basis points could turn to banking and PSU debt funds. These funds could give investors 6.5-7.5%, thereby helping them earn 50-150 basis points higher than small savings products. For those in the high tax bracket, if they hold these funds for more than three years, these products will also get indexation benefits, which will significantly improve the post-tax returns. Post the repo cut of 90 basis points by RBI, the government reduced interest rate on 1-, 2- and 3-year time deposits from 6.9% to 5.5% and on Public Provident Fund by 80 basis points to 7.1%. - Economic times
ЁЯНТ RBI raises short-term borrowing limit for states and UTs by 30% : The Reserve Bank of India has come up with another round of measures to cushion the impact of the Covid-19-induced shutdown with a focus on the finances of the states, some of which have announced staggered payment of salaries. States’ short-term borrowing limits have been increased by as much as 30% as they face pressure on revenues with economic activity coming to a halt and the transfers from the Central government also getting crushed due to lower Goods and Services Tax collection.Banks, which are bearing the brunt of the moratorium announced last week, would get some reprieve in meeting regulatory norms in respect to the capital needs, the central bank said in a statement. “It has been decided to increase WMA (ways and means advances) limit by 30% from the existing limit for all states/UTs (Union territories) to enable the state governments to tide over the situation arising from the outbreak of the Covid-19 pandemic,” the Reserve Bank said in a release. The revised limits came into force on April 1, 2020 and will be valid till September 30, 2020. - Economic Times
ЁЯНТ HDFC Group pledges Rs 150 crore support to PM-Cares Fund : Financial services conglomerate HDFC Group on Thursday said it has committed Rs 150 crore to the PM-Cares Fund to support the government for its relief and rehabilitation measures towards the Covid-19 pandemic. "These are uncertain and trying times for all of us. The HDFC Group's support to the PM Cares Fund is to commend the exemplary efforts of the Central & State governments, armed and paramilitary forces, local police, healthcare professionals and sanitation workers across the country, who are working tirelessly day in and out to fight the pandemic," HDFC Ltd chairman Deepak Parek said in a statement. The Prime Minister's Citizen Assistance and Relief in Emergency Situations Fund (PM-Cares Fund) was set up on March 28 to raise money for combating coronavirus outbreak and to provide relief to the affected. - Economic Times
ЁЯНТ RBI director Marathe presses for bold initiatives to revive MSME sector, amid COVID-19 crisis : The government and the Reserve Bank need to come out with a bold and comprehensive package to help small and medium enterprises tide over the unprecedented crisis created by COVID-19, said veteran co-operator and RBI central board director Satish Marathe. Piecemeal initiatives will not help the industry as “this is an exceptional crisis and warrants exceptional response,” Marathe told PTI. The coronavirus crisis is likely to end in the next three to six months, but the industry, which bore the brunt of slowdown during 2019, will take much longer to recover, he said. Referring to the recent measures announced by the government and the RBI to mitigate the impact of the pandemic, he said, these are only for short term and may not yield the desired results as the problem is severe and has been further aggravated by the lockdown. - Moneycontrol.com
ЁЯНТ Covid-19 Impact: Banks to feel capital pinch as asset quality to take hit : The 21-day nationwide lockdown to contain the spread of coronavirus (covid-19) leading to sluggish economic growth and the consequent rise in provisions for bad loans will exert pressure on the capital adequacy of banks, ratings agencies have warned. The impact will be more pronounced for public-sector banks (PSBs), where the Centre has not proposed any capital infusion for the financial year started 1 April and expects them to tap markets for funds. Ratings agency Moody’s Investors Service went to the extent of revising the outlook for the Indian banking system to negative from stable earlier.According to Moody’s, surge in loan loss provisions along with a decline in revenue will hurt the profitability of banks, causing a deterioration of capitalisation. It said if the government makes more capital infusions into PSBs, as it had in the past few years, it will mitigate capital pressure for them. “However, the government so far has not announced any new plan to provide capital support to PSBs. Most rated private sector banks will maintain strong capital buffers," it said. - Live Mint
ЁЯНТ Covid-19 relief: SBI relaxes payment timeline for one time settlement : State Bank of India (SBI) has extended the timeline for payment of settlement amount under its one-time settlement scheme by three months. Now, customers on board the scheme, SBI OTS 2019 / Rin Samadhan 19-20 / General compromise, can meet payment obligation by June 30, 2020. Under One Time Settlement (OTS) 2019, the extension will be available if the first two instalments of 5 per cent/15 per cent, and 20 per cent/25 per cent have been received within stipulated time of 30 days and 60 days respectively. The balance OTS amount can be paid by June 30, 2020. Bank will not charge any interest on the amount for this extended period. Similarly, under Rin Samadhan, the timeline for receipt of acceptance of the OTS proposal along with upfront payment from borrowers has been extended up to June 30, 2020, from the current March 31, 2020, and up to September 30, 2020, for recovery of entire OTS amount. This will provide an extended opportunity to borrowers who are unable to visit branches owing to the lockdown. - Business Standard
ЁЯНТ RBI moratorium on term and working capital loans may hurt business : The moratorium granted by the Reserve Bank of India (RBI), both on term and working capital loans, to provide a helping hand to corporates and customers struggling with inadequate liquidity, may become a cause for concern for them later. Under the RBI scheme, there is a three-month moratorium on the interest payment on working capital loans.So, after the end of three months, the deferred interest (of three months) will be collected immediately after the moratorium ends. Hence, corporates may end up paying four months interest on their loans together. This could come as a blow to companies, given the current situation. C S Setty, MD at SBI, told the media on Wednesday that if anyone is unable to pay the amount after the moratorium period, it will not immediately impact the asset quality though the account will become special mention account 1 (SMA 1). - Business Line
ЁЯНТ Covid-19 impact: Axis Bank offers EMI deferment on loans for 3 months : Axis Bank has offered its customers to opt for the loan moratorium if they face problem is keeping their EMIs running, in line with actions of its peers. “In the wake of the Reserve Bank of India’s guidelines on the Covid-19 Regulatory Package, we are now offering you the flexibility to opt for a moratorium/deferment, Axis Bank said in a tweet. Customers can opt for moratorium on payment of installments and interest for various term loans/credit card dues, and/or defer the interest for working capital facilities due between March 1, 2020 and May 31, 2020, it said. - Business Line
ЁЯНТ ICRA expects stressed assets of banks, NBFCs to jump in FY21 : tressed assets of banks and non-banking financial companies (NBFCs) could spike in FY21, despite the three-month moratorium provided by the Reserve Bank of India to borrowers on their loan repayments, warned credit rating agency ICRA. It reasoned that with the fall in economic activity, debt servicing ability of borrowers could be impacted. Underscoring that Covid-19 and its aftermath will affect many businesses, the agency said the SME (small and medium enterprise) and retail segments will be more affected than the corporate segment. Resumption of timely repayments after moratorium, which only provides near-term respite, remains suspect, especially for the unorganised segments with limited alternative funding avenues, it added. - Business Line
ЁЯНТ Covid-19: SBI Cards offers moratorium on credit card dues : Close on the heels of the RBI’s Covid-19 package, SBI Cards and Payment Services has given its cardholders the option to avail a moratorium on their credit card dues. The moratorium period is of three months, for making payment of credit card outstanding balance/EMIs which are due between March 1 and May 30 this year, as well as the entire outstanding amount, including the applicable interest and charges (other than late payment charge) during this period, as per the cardholder’s June 2020 payment due date. For EMI payments, there will be no extension of tenure. Any account which was in current status (non-delinquent with no overdues) as on February 29 would be eligible for the moratorium, SBI Cards has said. - Business Line
ЁЯНТ Arogya Sanjivani will cover Covid-19 hospitalisation charges, says IRDAI : The Insurance Regulatory and Development Authority of India (IRDAI) has said Arogya Sanjivani, a newly launched standard health insurance product, will cover hospitalisation charges to treat coronavirus infection. The regulator has also approved 29 general and health insurance companies to market Arogya Sanjivani. These include Raheja QBE General Insurance, New India Assurance, Bajaj Allianz General Insurance and United India Assurance, among others. “…the product Arogya Sanjeevani, offered by the above general and health insurers, also covers the hospitalisation treatment costs of Covid-19,” it said. - Business Line
ЁЯНТ Covid-19: Date for renewal of health, motor insurance policies extended to April 21 : The government has provided relief for third-party motor insurance and health policy holders in the light of the Covid-19 lockdown. The renewal dates of health and motor insurance policies which fall during the period March 25, 2020 to April 14, 2020 are now extended till April 21, 2020 due to the coronavirus lockdown, according to notifications issued by the Finance Ministry. This would mean that existing policies which fall due for renewal from March 25 to April 14, can be renewed up to April 21, an official release said. - Business Line..
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