Banking news update

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BoB cuts base rate by 10 bps: Bank of Baroda cut its base rate by 10 bps to 9.90% & also to reduce BPLR by 10 basis points from 14.25% to 14.15%. The reduction in both rates will be effective from July 13, 2015. This is the second time in the current fiscal that the bank has lowered it base rate. So far, the public sector bank has reduced its rate by 35 bps in FY16. (FE)

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Stressed assets: RBI mulls stricter norms: Concerned over banks’ reluctance to resolve accounts that are showing signs of stress, and instead resorting to ‘ever greening’,  RBI is mulling stringent norms for loans that are frequently falling in the category 2 of special mention accounts (SMA 2). Loans are classified as SMA 2 when it becomes overdue for more than 60 days. (BS)

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Bank staff association mounts pressure on Centre to freeze Mallya’s assets: The All-India Bank Employees Association is planning to hold demonstrations across the country on July 20 to pressure the Centre to confiscate the assets of Vijay Mallya, founder of failed Kingfisher Airlines, who is said to be the largest bank loan defaulter in the country. (BL)

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New BRICS bank to look at local, international borrowings: The New Development Bank (NDB) being launched by the BRICS group of emerging economies plans to raise money both on local markets and internationally, its president said. (BS)

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Transit operators to issue prepaid mobility cards: RBI has issued final guidelines on mobility cards that will allow people to travel in buses, metros and taxis without cash. This semi-closed prepaid payment instruments (PPIs) will be issued by mass transit operators (such as metro or road transport) and will have a minimum validity of six months. The maximum amount that can be loaded on the card is Rs 2,000. (BS)

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Cyber frauds on rise with increase in digital banking: Assocham-PwC: With the increase in banking on mobile phones and the internet, financial frauds in the system have also seen an uptick, says a survey on financial frauds in the financial sector by Assocham and PwC. The report said that  financial frauds led to approximately $20 billion (Rs 1.26 lakh crore) in direct losses annually. (BS)

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Start-up turns retail outlets into mini-banks: Now you can make your next-door kirana store an extension of your bank branch to deposit money. Using a technology platform, NumberMall promises to disrupt the traditional banking practice, provding a lot of flexibility and convenience to people. This service is being launched in 15,000 outlets roped in by NumberMall in 10 States. (BS)

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RBI may give payment bank licence to Post Dept. by September: RBI is expected to grant a payments bank licence to the postal department by September for operating Post Bank, Communications and Information Technology Minister Mr. Ravi Shankar Prasad said on Thursday. (BS)

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Bandhan appoints former chief economic adviser Mr. Ashok Lahiri as chairman: Bandhan Bank, to be formally inaugurated by President on August 23, has appointed Mr. Ashok Lahiri, former chief economic adviser, Government of India, as its chairman. Mr.  Chandra Shekhar Ghosh, founder of Bandhan Financial Services (BFS), the being-born bank’s progenitor, will be MD & CEO of the bank. (BS)

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IDFC to apply for final bank licence today: IDFC, which had received in-principle approval from RBI last year to set up a bank, will apply for a final approval on Friday. The move comes on the back of the Madras High Court’s approval for the demerger of IDFC and IDFC Bank on June 29. (BS)

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RBI's prior nod must for NBFCs for acquisition, shareholding transfer of 26%: NBFCs will be required to take prior approval of RBI for change in the shareholding, including progressive increases over time, which would result in acquisition or transfer of shareholding of 26 per cent or more of the paid up equity capital, said the regulator. (BS)