Union Bank of India, the nation's sixth-biggest state-run lender by assets, reported a smaller-than-expected 22 percent fall in quarterly profit even as bad loans rose. Net profit fell to 5.19 billion rupees ($81 million) during its fiscal first quarter to June 30, from 6.64 billion rupees reported a year earlier, the Mumbai-based lender said. Analysts on average had expected a net profit of 4.99 billion rupees, according to data compiled by Thomson Reuters. Gross bad loans as a percentage of total loans rose to 5.53 percent in the June quarter from 4.96 percent in the previous three months and 4.27 percent in the same period a year earlier.
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Bank of India, the nation's third-biggest state-run lender by assets, reported a sharply bigger-than-expected 84 percent fall in quarterly profit as bad loans surged. Net profit fell to 1.3 billion rupees ($20.3 million) for its fiscal first quarter to June 30, from 8.06 billion rupees reported a year earlier, the Mumbai-based lender said. Analysts on average had expected a net profit of 3.31 billion rupees, according to data compiled by Thomson Reuters. Gross bad loans as a percentage of total loans rose to 6.8 percent in the June quarter from 5.39 percent in the previous three months and 3.28 percent a year earlier. (Reuters)
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Royal Bank of Scotland Group Plc is in talks to sell its Indian private banking business to Sanctum Wealth Management, a firm set up by its local private banking business head Shiv Gupta, a spokeswoman for the bank said on Monday. Switzerland's Union Bancaire Privee said in March it was buying the overseas business of British wealth manager Coutts from RBS, as part of the bank's drive to pull back from foreign markets and focus on UK retail and commercial banking. RBS' India private banking business was not part of that deal. RBS has signed a non-binding framework agreement and is now in discussions to sell the Indian private banking unit to Sanctum Wealth, the spokeswoman said in an e-mailed statement, without giving details. "This marks another step towards delivering the strategy to make RBS a stronger, simpler, more sustainable business, more aligned with the needs of our customers in the U.K. and Western Europe," the statement said. A source with knowledge of the transaction with Sanctum said RBS India private banking managing director Gupta could rope in some private investors in Sanctum Wealth after the transaction was completed. In India, RBS competes with global banks including Barclays Plc, Citigroup Inc, Standard Chartered Plc as well as a host of domestic financial firms in the wealth management business. Many foreign wealth managers had scrambled to open up shop in India a few years back and aggressively ramped up operations to take advantage of robust economic growth, only to find themselves struggling. Although Asia's third-largest economy has been minting millionaires at a strong pace, it has failed to translate into profits for the banks that have set up teams of well-paid bankers to help manage those riches. Cut-throat competition, high staff costs and weak markets are squeezing revenue of the top private banks, while growth opportunities are limited by regulations that restrict product offerings. Faced with these challenges, Morgan Stanley <MS.N> in 2013 decided to sell its India wealth management unit to Standard Chartered, after entering the fiercely competitive market about four years ago. Some industry executives, however, say that the long-term prospects of the private banking business in India remains attractive, as a pickup in the country's economic growth is expected to boost the number of high net worth individuals. (Reuters)
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Hinduja Group-promoted IndusInd Bank on Monday (27 July) said it has completed acquisition of Royal Bank of Scotland's diamond and jewellery financing business in the country."IndusInd Bank has completed the acquisition with the entire business portfolio migrating to the bank. The acquired loan book is approximately Rs 41 billion (Rs 4,100 crore," IndusInd Bank said in a BSE filing.In April this year, IndusInd Bank said it has entered into an agreement with Royal Bank of Scotland to acquire the latter's diamond and jewellery financing business in the country for an undisclosed sum.IndusInd Bank is already into diamond and jewellery financing business and this acquisition is expected to enhance its position in the segment.RBS has been trying to exit its operations in India since its UK-based parent went into a government bailout after the 2008 global credit crisis.After the Reserve Bank in 2012 allowed RBS to sell its retail banking business to rival HSBC, the UK based bank had said it would wind down its business gradually.RBS has merely 20 branches in the country spanning just 10 cities.In August 2013, RBS had sold its credit card business, mortgage and commercial banking portfolios to mid-sized private sector lender Ratnakar Bank. The deal included acquiring about 1,20,000 customers and employees.RBS still retains its presence in the wholesale business and offers financing, risk management, investment banking, cash, payments, trade finance and wealth management solutions to its clients.(PTI)
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RBI has asked the I-T department to get a 'tax angle' verification done for four dozen corporate entities seeking licence to operate small finance and payment banks in the country. RBI Governor Raghuram Rajan had recently written to the Central Board of Direct Taxes (CBDT), the apex policy making body of the Income Tax department, to expedite the matter and provide the banking regulator with inputs about individuals at the helm of these entities with businesses spread across the country and abroad, officials said. CBDT has asked its investigation and regular assessment ranges across the country to "quickly" collect the data and submit them so that RBI can take a final view on the grant of licences to eligible parties. "The inputs sought relate to financial and tax history of close to 50 entities, their owners and senior executives who have applied for getting RBI's licence to run small finance and payment banks," they said. It has been instructed by RBI and CBDT, the officials said, that any adverse record or observation about financial dealings of these entities, found out either by way of an earlier action by the taxman or through regular mechanism of intelligence and data gathering, should be reported. "In case there is no adverse finding, the I-T will send an all okay report," one of the officials said. Those entities for which tax clearances have been sought include Intellecash MicroFinance Network Company Private Ltd., SKS MicroFinance Limited, Capital Local Area Bank Limited, Electronica Finance Limited, Repco MicroFinance Limited, SE Investments Limited, RGVN (North East) Micro Finance Limited, Ujjivan Financial Services Private Limited, and Ashika Global Securities Private Limited. . Vodafone M-Pesa Limited, NSDL, Cholamandalam Distribution Services Limited, Kishore LaxmiNarayan Biyani, RIL, NSE Strategic Investment Corporation, Aditya Birla, Airtel M Commerce Services Limited, Videocon D2H, and Sonata Finance Private Limited are also among the entities about which clearance has been sought from the tax authorities. Rajan had earlier said the Reserve Bank of India would be able to announce new sets of bank licences, or at least one set of them, by August-end. The RBI had received 72 applications for small finance bank licences and 41 applications for payment bank licences. The objective of licencing small banks is to promote financial inclusion by offering saving vehicles and credit to small business units and other unorganised sector entities. Small finance banks will primarily undertake basic banking activities of acceptance of deposits and lending to unserved and under-served sections, including small business units, small and marginal farmers, micro and small industries and unorganised sector entities. Payment banks would be allowed payment and remittance services through various channels. However, such lenders cannot issue credit cards or undertake lending activities. (PTI)
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Singapore state investor Temasek Holdings said on Saturday Chief Executive Ho Ching, the wife of Prime Minister Lee Hsien Loong, has decided to extend her three-month sabbatical until October. Temasek did not give a reason for the decision by Ho, which comes amid media speculation that elections could take place in the city-state this year. Ho, 62, took leave in mid-April after the death of her father-in-law, Lee Kuan Yew, Singapore's first prime minister. Her leave had been due to end this month. "She will continue with her board duties and specific stewardship duties," the Temasek statement said. Temasek is a major global investor with stakes in Standard Chartered, Chinese banks and Singapore's biggest companies. It reported this month the value of its portfolio had jumped by almost a fifth to a record S$266 billion ($197 billion) in the year to March 31, 2015. It had said Ho would take a three-month sabbatical but the move was not linked to any plans for her to retire from the post she has held for more than a decade. There has been some speculation about the timing of her departure. Officials said at the state investor's annual review they expected Ho to return to work this month. Temasek president Lee Theng Kiat, who has temporarily taken over Ho's duties, will continue to cover the company's normal business, the statement said. Singapore media and online blogs have speculated that the next general election could be held some time after celebrations for the 50th anniversary of Singapore's independence in August. On Friday, an electoral boundaries review committee released its report on redrawing Singapore's constituencies, signalling that elections are around the corner. (Reuters)
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Tarun Chugh, MD & CEO, PNB MetLife Insurance, makes you consider three important things while discussing insurance needs with your advisor Choosing the right Life Insurance to buy is not easy. This might explain why in India, only 4 per cent of us own a Life Insurance plan. Even in the metros where consumers are more informed about insurance and its benefits, you still hear about these complains: “I did not know this was for long-term, I was told three years”,“I bought this for tax saving purpose only”,“I was not aware that this was a market linked plan”,“I don’t think I have adequate Life Cover” So, to help you choose the right Life Insurance plan, here are 3 simple guidelines you need to consider. 1) Always ask for a free Need Base Analysis to see if insurance is right for you Buying life insurance depends on many factors like income, health, age, expenses and goals. While insurance can become an integral part of your financial portfolio, many consumers don’t know that they can request for a no-obligation Need Base Analysis from insurance companies to determine whether insurance products are right for them. 2) Assess financial protection for your familyOne of the key considerations when buying insurance is to provide financial security for your family. It is important for you to assess your family’s financial needs and determine the regular income amount your family will receive should something unfortunate happens to you. That will help you decide how much life coverage you need for your plan so that your family can receive the desired monthly income. 3) Ensure insurance proposal form filled in properly It is often said that the moment of truth for an insurance policy is when a claim is made and the insured amount is successfully paid out to the policyholder’s family. One of the most overlooked processes when buying insurance is the completeness of information provided by the policyholder. It is crucial that you provide all the necessary details and documentations truthfully and honestly to ensure a smooth claim process. If you are the one submitting a claim, make sure that the details you provide are clearly stated as well.
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Indian-origin banker Anshu Jain, Deutsche Bank's former co-chief, has got a clean chit from the German financial watchdog BaFin, on charges of allegedly lying to the regulators about the interbank rate rigging scandal. Jain, who quit as co-CEO of Deutsche Bank with effect from June 30, was earlier accused of having "knowingly made inaccurate statements" to Germany's central bank, Deutsche Bundesbank, thus misleading regulators on what he knew about the alleged manipulation of inter-bank rates such as Libor. As per reports, the Federal Financial Supervisory Authority (BaFin) had criticised Deutsche Bank and Jain in its report on investigations into the rate fixing scandal. Bafin and Deutsche Bundesbank together share the supervision of banking business in the country. A report in business daily Financial Times, however, said on Saturday that BaFin has dropped "a key strand of its investigation" and has cleared Jain of allegedly lying to the central bank about what he knew about the rate manipulation. On its part, Deutsche Bank said, "We continue to work with our regulator to bring this inquiry to a conclusion." In a letter written to Jain earlier this month, BaFin President Felix Hufeld said that the regulator was "dropping that part of its probe into Libor-rigging at Deutsche after considering that the 'probable' interpretation of the evidence weighed in Jain's favour," the report said. "The suspicion that you made knowingly incorrect statements to a regulator seems unsubstantiated to me... This aspect will therefore no longer be relevant in the continued assessment by BaFin," Hufeld wrote in his letter to Jain. The BaFin President, however, added that all other allegations against Jain and Deutsche Bank were still being evaluated by the regulator. Jain, 52, had reportedly told the central bank that he had no knowledge of rumours of possible rigging in 2008. Deutsche Bank had said last month that Jain's comments were taken out of context. "Jain disputes as baseless the allegation that he misled the Bundesbank in his 2012 interview. "He understood Bundesbank's question about when he first learned of rumours of possible LIBOR rigging to mean rigging at Deutsche Bank itself which he learned of in 2011, not rigging in the marketplace which was publicly reported on in 2008," the bank had said in a statement on June 27. The bank paid USD 2.5 billion earlier this year to settle probes in the US and the UK into alleged manipulation of Libor and Euribor benchmark rates by its traders. Jain had joined Deutsche Bank more than 20 years ago and he served as a co-CEO for three years.(PTI)
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