News related to RBI

1. RBI extends date of exchanging pre-2005 notes to Jan 1, 2015

2. Reserve Bank of India (RBI) on 13 March 2014 hiked the trade
related remittance limit from 2 lakh rupees to 5 lakh rupees per
transaction with immediate effect. It also increased the number of
transaction handled by exchange houses.
3. KC Chakrabarty, Deputy Governor, Reserve Bank of India, has quit
three months ahead of completion of his term.
4. RBI pegged 2014-15 GDP growth at a central estimate of 5.5
percent.
5. Economic growth for 2014-15 expected at 5.5 pc.
6. CAD expected to come down to 2 pc of GDP in 2014-15.
7. Retail inflation expected to be under 6 pc in 2014.
8. It halved the overnight call money rate to 0.25 percent and increased
the 7-day and 14-day repo limits to 0.75 percent from 0.50 percent.
9. The Reserve Bank of India has constituted a GIRO Advisory Group
(GAG) to implement a national Indian Bill Payment System so that
households will be able to use bank accounts to pay school fees,
utilities, medical bills and make remittances electronically. Panel is
headed by Prof. Umesh Bellur
10. RBI permitted Wholly Owned Subsidiaries (WOS) of the foreign
banks to acquire domestic private sector banks and also permitted
the banks to set up branches anywhere in the country.
i. Currently, foreign banks as a group are entitled to open 12 branches
in India every year.
ii. The initial minimum capital for a WoS will be Rs 500 crore,
iii. RBI said that the WoS will be required to meet Basel-III
requirements (9 per cent Tier-I capital) right from Day One.
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Note: The Reserve Bank has further clarified that the public can
continue to freely use these notes for any transaction. RBI has said that
people can unhesitatingly receive these notes in payment, as all such
notes continue to remain legal tender.
Note: foreign banks will not be allowed to hold more than 74 percent in
the private banks they may acquire.
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News related to RBI
iv. For the first three years, the WoS will have to maintain Tier-I capital
at 10 per cent.
BRANCH OPERATIONS
i. They will be allowed to open branches in Tier 1- centers without
taking prior permission from the RBI provided at least 25 per cent
of their branches are opened in un-banked rural centres (Tier 5 and
Tier 6).
BOARD OF DIRECTORS
i. The RBI also mandated that at least a third of the directors should
be independent of the management of the subsidiary in India, its
parent or associates. It also wants at least a third of the directors
to be Indian nationals resident in India.
11. RBI Launches New RTGS System: The Reserve Bank of India on 19
Oct. launched the new Real Time Gross Settlement (RTGS) system for
large-value funds transfer.

12. RBI pegs CAD USD 56 billion in 2013-14 much lower than the
quantum projected earlier. The current account deficit (CAD), which
is the difference between outflow and inflow of foreign exchange,
touched an all-time high of USD 88.2 billion or 4.8 percent of the
GDP in 2012-13.
13. According to The Raghuram Rajan committee report suggested a
new methodology for devolving funds on states based on a 'Multi
Dimensional Index (MDI)'.
14. RBI set up a 3 member committee under former Governor Bimal
Jalan to scrutinise applications for new bank licences. The
th
Note:
1, The Real Time Gross Settlement (RTGS) system is a large-value
funds transfer system which banks use to settle inter-bank transfers for
their own accounts as well as for their customers.
2. The new ISO 20022 compliant RTGS system provides three access
options to participants thick-client, Web-API (through INFINET or
any other approved network) and Payment Originator module.
Note:
Based on the MDI scores, the 10 least developed states are:
Odisha, Bihar, Madhya Pradesh, Chhattisgarh, Jharkhand,
Arunachal Pradesh, Assam, Meghalaya, Uttar Pradesh and
Rajasthan.
The 7 most developed status are Goa, Kerala, Tamil Nadu,
Punjab, Maharashtra, Uttrakhand and Haryana.
11 less developed states are : Manipur, West Bengal,
Nagaland, Andhra Pradesh, Jammu and Kashmir, Mizoram,
Gujarat, Tripura, Karnataka, Sikkim and Himachal Pradesh.
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committee comprises of: Usha Thorat (former RBI Deputy
Governor), C B Bhave (former Sebi chairman) and Nachiket
Mor (financial sector expert).
15. RBI has relaxed trade credit norms for all type of companies to avail
of trade credit not exceeding $20 million up to a maximum period of 5
years for import of capital goods.
16. According to RBI prudential norms:
i. Banks are allowed to lend a maximum of 50% of their capital
fund on any day during a fortnight.
ii. Borrowings by Scheduled Commercial Banks should not
exceed 100 per cent of their capital fund.
iii. Banks are allowed to borrow a maximum of 125 per cent of
their capital fund on any day, during a fortnight.
iv. Banks are allowed to lend a maximum of 25% of their capital
fund on a fortnightly basis.
v. Lending of Scheduled Commercial Banks, on a fortnightly
average basis, should not exceed 25 per cent of their capital
fund.
17. RBI has decided to introduce a Forex Swap Window to meet the
entire daily dollar requirements of of three public sector oil marketing
companies IOC, HPCL and BPCL
18. According to the new guide line of RBI, now banks can open their
branches in tier I cities (the city which have population more than
one lakh) without taking its permission in each case.
19. RBI Rajbhasa Awards: Punjab National Bank (PNB) won five
Rajbhasa Awards organized by RBI.
20. RBI guide lines for the clearance of all the cheques is 2 days.
21. RBI hiked the investment limit in government securities by FIIs and
long-term investors $25 billion from $20 billion and in corporate
bonds $50 billion from $45 billion.
22. RBI permitted the premature encashment of 8% savings (Taxable)
Bonds for individual investors who are 60 years and above in age.
23. The RBI said, min paid-up equity of 25 % should be held directly by
the lender. Also, repayment of the principal will commence only after
completion of minimum average maturity of 7 years and no
prepayment will be allowed before maturity.
24. The Reserve Bank opened a special borrowing window of Rs
25,000 crore to help the crisis-ridden mutual funds tide over liquidity
problems.
25. Aditya Birla Group chairman Kumar Mangalam Birla has resigned
from RBI board to avoid any conflict of interest as one of his group
firm is in the race for a new banking licence.
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News Related to Banking & Finance

1. The Bank of Bahrain and Kuwait, BBK, plans to expand its
operations in India by opening its fourth branch in the country in
New Delhi.
2. The Finance Minister has allowed retirement fund body Employees'
Provident Fund Organisation (EPFO) to become a member of a
stock exchange although its trustees oppose parking even a part of
its over Rs five lakh crore corpus in equities.
3. Canara Bank names cricketer Shikhar Dhawan as its brand
ambassador.
4. Corporation Bank has bagged the awards for lending to MSE (micro
and small enterprises) and to micro enterprises from the Union
Ministry of Micro, Small and Medium Enterprises (MSME) for 2012-
13.
5. Indian Bank has bagged national award for excellence in lending to
micro enterprises for 2012-2013, for the consecutive second year.
6. Interest rate on Post Office FDs increased: The rates apply to post
office saving schemes and the return on 1-2 years deposits has
been hiked by 20 basis points from 8.2 percent to 8.4 percent.
7. The latest data released by the Central Statistics Office shows that
Bihar is the fastest growing State with its Gross State Domestic
Product growing at 15.05 per cent during 2012-13. According to the
CSO data, Gujarat ranked 6th with growth rate at 7.96 per cent,
behind Bihar and Madhya Pradesh with 9.89 per cent, Goa 8.47 per
cent, Kerala 8.24 per cent and Odisha 8.09 per cent. The all-India
growth rate in 2012-13 was 4.47 per cent.
8. India has once again emerged as the largest non oil trading partner
of Dubai in 2013-14.
9. India has committed 8.5 billion rupees to Bhutan for Small
Development Project for the countrys the 11th Five Year Plan.
10. The World Bank provide up to $3 billion in aid for Ukraine in 2014 to
help the country deliver much-needed economic reforms.
11. India and United States Energy dialogue was held in New Delhi from
5 March 2014 to 11 March 2014.
12. Russia suspended from G-8. Frances foreign minister says that
leaders of the Group of Eight world powers have suspended
Russias participation in the club amid tensions over Ukraine and
Russias incursion into Crimea.
13. Gujarat has been ranked number one in a list of India's 20 largest
states in terms of economic freedom.The index on economic
freedom takes into account governance, growth, citizens rights,
and labour and business regulations.
14. Kotak Mahindra Bank launched its online social account integrated
with Facebook and Twitter.
15. Walmart Stores Inc has filed a lawsuit against Visa Inc, accusing the
credit & debit card giant of conspiring with banks to fix fees that
merchants pay for accepting payments through Visa cards.
16. SEBI gets back power to act against ponzi schemes. The capital
market regulator, the Securities and Exchange Board of India
(SEBI), has got back the power to act against ponzi schemes, illegal
deposit schemes and assess call data records in securities-related
offences, besides others.
17. ICICI Prudential Mutual Fund has bagged Morningstar Indias best
fund house award in the debt, equity and multi-asset category.
18. ADB (Asian Development Bank) pegs GDP growth rate for 2014-15
at 5.5 pc.
19. Bank of India launched Instant Money Transfer Scheme. IMT
scheme allows customers to withdraw cash without using either debt
card or credit card at BoI's IMT-enabled ATMs. This is the first-of-its-
kind initiative launched by a public sector bank.
20. A new data on international arms transfers released that Indias
import of weapon systems is three times more than Pakistan and
China.
21. Wholesale Inflation falls to 9-month low of 4.68 per cent in Feb
22. Max Life Insurance ties up with Toyota Financial Services: Max Life
Insurance has tied up with Toyota Financial Services India Ltd to
provide insurance cover to car loan customers.
23. Exim (Export and Import) Bank extends $90 mn line of credit to
Republic of Congo.
24. The headline inflation number, the wholesale price index or WPI,
has increased to 7 per cent in October from 6.46 per cent in
September.
25. Deutsche Bank has become the first bank in India to use the
Reserve Bank of India (RBI)s window to swap fresh foreign
currency non-resident (bank), or FCNR (B), dollar funds. It has
raised about $450 million FCNR (B) deposits from about 10 non-
resident Indians and swapped it with the central bank,
26. YES Bank has become the first bank to raise $ 225 million funds
overseas using the swap loan facility provided by the Reserve Bank
of India (RBI) . The private sector lender raised $255 million ($180
million and 58 million) by way of dual currency, multi-tenor
syndicated loan facility.
27. Canara Bank and Apollo Munich Health Insurance (AMHI) have
entered into a bancassurance tie-up. This is the first such tie-up for
the insurance company in its six years of existence. Bancassurance
is distribution of insurance products through a banks network.
28. In September 4, RBI had announced a swap window to attract
Comment
FCNR (B) dollar funds. Accordingly, it has been decided to offer
such a window to banks to swap fresh FCNR (B) dollar funds,
mobilized for a tenure of at least three years, at a fixed rate of 3.5%
a year for the tenure of the deposit,.
29. World Bank lowers 2013 growth forecast for East Asian developing
countries to 7.1%
30. WTO lowers growth projection for world trade in 2013 to 2.5%
against 3.3 per cent projected in April and 4.3 per cent earlier in the
year
31. Own Your NPA campaign launched by IDBI: In a bid to speedily
recover Non-Performing Assets (NPA), the IDBI Bank has launched
a campaign named Own Your NPA.
32. Tata Communications Payment Solutions Ltd (TCPSL), a wholly
owned subsidiary of Tata Communications Ltd, today inaugurated
Indicash ATMs in Mysore. Note: The companys first white-label
ATM was launched at Chandrapada village in Thane district on June
27.
33. China launched its first direct bank, a new mode of providing online
banking services without any entity outlets. The direct bank has
been launched by the Bank of Beijing in co-operation with
the Netherlands-based ING Group.

Note: i. A direct bank is a bank without any branch network that
offers its services remotely via online banking and telephone
banking and may also provide access via ATMs (often
through interbank network alliances), mail and mobile.
34. Bhartiya Mahila Bank proposes to complete the first six branches at
Mumbai, Delhi, Kolkata, Chennai, Indore & Guwahati.
35. Headquarter at New Delhi and likely to operational by November this
year.
36. Indian banks would need Rs 3,90,000-5,00,000 crore capital over
the next six years in the wake of Basel III capital regulations
announced by the RBI.
37. The Bank International Indonesia (BII) launched its operations in
India by opening a branch in Mumbai.
38. ICICI Bank, the countrys largest private sector bank, launched its
Branch on Wheels to offer basic banking services in remote areas
which have so far been devoid of banking facilities.
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