BANKING UPDATES

Reform move: Govt aims to halve pending tax disputes: Revenue secretary Hasmukh Adhia told TOI that the government was moving to first unclog disputes at the level of tax department's commissioner (appeals), the first port of call for taxpayers, by seeking clearance of low-value cases. (TOI) § Loan growth of Private sector banks to be double of PSBs till FY19: Private sector lenders will witness an annual credit growth of 24 per cent till financial year 2019, twice that of their ailing and capital-starved state-run peers, domestic ratings agency Crisil said today. (ET) § A new scheme for facilitating start-ups intellectual property: The Government of India has launched a scheme for facilitating Start-ups Intellectual Property Protection (SIPP) to promote awareness and encourage IPR protection among startups. The scheme, which is part of recently-launched Start-Up India by the Prime Minister Narendra Modi, is to protect and promote intellectual property rights (IPR) for startups and encourage innovation and creativity among them. (BS) § Apex court stops govet from selling residual stake in Hindustan Zinc: Questioning the government’s “hurry” to divest its remaining stake in Hindustan Zinc Ltd (HZL), the Supreme Court on Tuesday directed the Centre to put on hold a plan to offload its 29 per cent share in the erstwhile public sector unit, now a subsidiary of Vedanta. (BL) § Bankruptcy order on Sivasankaran lifted: A cloud has lifted for Chennai-born transnational businessman Chinnakannan Sivasankaran after the Supreme Court of Seychelles on Monday cancelled an August 2014 order declaring him bankrupt and directed all his assets around the world be freed. (BL) § RIL Q3 net up 39% to record Rs 7,290 cr : Reliance Industries' (RIL's) third quarter (Q3FY16) consolidated profit rose 39% to a record Rs 7,290 crore ($1.1 billion), boosted by the highest refining margins in seven years. (TOI) § China’s growth hits 25-yr low, raises stimulus hope: China's slowdown, along with the slump in commodity prices, prompted the International Monetary Fund (IMF) to cut its global growth forecasts again on Tuesday, and it said it expects the world's secondlargest economy to see growth of only 6.3% in 2016. (TOI) § Oil market could drown in oversupply in 2016, says IEA: The world could find itself drowning in oil this year and prices could fall further as new Iranian output cancels out production cuts elsewhere, according to the International Energy Agency. (The Guardian) § Investors turn highly cautious on lower- rated bonds: Fund managers continue to be cautious about investing in debt paper that’s rated below AAA. Issuances of bonds that don’t carry a top-notch rating have slowed sharply in the last couple of months. Indeed, corporate bond market activity itself seems to have lost a bit of momentum. (FE) § No solution yet for stuck road projects: Though half of the build, operate and transfer (BOT) expressways being built remain in danger of defaulting — according to Crisil, 5,080 km of roads with an outstanding debt of Rs 45,900 crore are at very high/ high default risk — no resolution was reached at the meeting between bankers and officials of the roads ministry and the National Highways Authority of India (NHAI) earlier this month. A final decision on the bankers’ demand of a pari passu charge on tolls from these expressways will be taken in a meeting with finance minister Arun Jaitley later this month. (FE) § IMF cuts world growth, holds on India: The IMF on Tuesday kept unchanged its growth forecasts for India at 7.5% for the next two years, but trimmed projections for global economic growth for 2016 and the year after that by 0.2 percentage point each on “subdued demand and diminished prospects”. (FE) § Budget may allocate Rs 5000 cr to NITI Aayog as discretionary fund: The Budget may allocate about Rs 5,000 crore as discretionary fund at NITI Aayog’s disposal for rewarding states undertaking economic reforms and making focused interventions to address local problems. (FE) § Insurers for tax exemptions on home, shopkeepers policies: In the last few years, profits of general insurance companies took a hit as a result of severe natural calamities – floods in Tamil Nadu and Jammu & Kashmir and the cyclone Hud-Hud. In order to increase awareness about householder policy and shopkeepers insurance, the general insurance industry has proposed tax exemptions for such policy premiums. (FE) § Indian Bank to raise Rs 1100 cr via Basel-III compliant bonds: The Board of Directors of the Company at its meeting held on January 19, 2016 has accorded approval to the Bank to raise Basel-III compliant tier-II bonds for Rs. 1,100 crore in one or more tranches in the current or subsequent years based on the requirement,” Indian Bank said in regulatory filing. (BL) § FPSF moves SC against Sebi nod to Imfi to act as self –regulatory body: The Financial Planning Supervisory Foundation (FPSF) has moved the Supreme Court against markets regulator Sebi’s in-principle approval to the Institution for Mutual Fund Intermediaries (Imfi) to act as a self-regulatory organisation (SRO) for distributors of mutual fund products. (FE) § Job stimulus a shot in the arm offor MSME this budget: With recognition of micro, small and medium enterprises (MSMEs) as major employment providers, Finance Minister Arun Jaitley is said to be considering a number of proposals to provide boost to MSME businesses in his upcoming Union Budget 2016-17. (BS)

BANKING UPDATES

Implementation challenge for India: Rajan:Implementation remains the major challenge for India's economy and if it can deliver on its promises the country will be "the place to be", RBI governor Raghuram Rajan has said. When asked to nominate the three things that most need to change to make a difference to the Indian economy Rajan said, "Implementation, implementation, and implementation". (TOI) § A RBI top brass discusses NPA issues with bankers, ARCs: Reserve Bank Governor Raghuram Rajan and other top RBI officials met bankers, representatives of asset reconstruction companies and NBFCs today to discuss effectiveness of distressed assets resolution mechanism and sought their suggestions to make it more efficient. (BS) § Bad loans: RBI reviews bank’s books: With banks staring at the March 2017 deadline to purge their books of bad loans, the Reserve Bank of India on Monday reviewed the functioning of various mechanisms to achieve this goal, including the joint Lenders’ Forum, Strategic Debt Restructuring Scheme and sale of assets to asset reconstruction companies. (BL) § Paytm aims for summer launch of payment bank: Paytm, the digital wallet and e-commerce company, is looking at a summer launch this year. Project Pokhran , as the company call its payments bank project internally, is in full swing to hire professionals and set up offices for the new business. EY ( earlier earnest and Young) and Mckinsey & Co are advising paytm for the banking foray. (BS) § Piramal to Float 6k-cr Distressed Assets Fund: Move to set up one of the biggest funds in India at a time when banks may hasten pace of distressed asset sale: RBI’s move to allow banks to convert part of their debt into equity of a defaulting company and later find a buyer for their stake – also comes as a huge opportunity for Piramal Capital which will own the majority of the funds. (ET) § Bond prices dip, call rates steady: Government Bonds (G-Secs) dropped further on sustained selling pressure from banks and corporate, while the overnight call money rates ended stable owing to alternate bouts of buying and selling. (BL) § Kotak bank net up 32% to Rs 945 crore, ING Vysya deal a drag: Kotak Mahindra Bank (KMB) today reported a 32 per cent rise in its December quarter net profit at Rs 945.16 crore as the fourth-largest private lender's growth numbers were impacted by higher provisions for the erstwhile ING Vysya Bank, which merged with it .(ET) § Sensex plummets 267 points on exports dip, oil prices : Market benchmark Sensex on Monday fell to a 20-month low after plunging 266.67 points to 24,188.37, dragged down by a massive dip in exports, while RIL cracked over 5 per cent on crude slipping below USD 28 per barrel. (FE) § Bank Nifty down 1.22% as sector faces NPA pressure: Bank Nifty, the guage of top banking shares, touched new lows on Monday as the sector continues to reel under the asset quality pressure even as the Reserve Bank of India (RBI) has asked the banks to clean up their books by March 2017. (FE) § MFs may show agent commission in a/c statements: After capping agent commission, mutual fund industry body and front line regulator AMFI may now ask the fund houses to disclose the individual distributor commission in the account statements sent to investors. (BL) § Trade deficit up as gold imports triple: India's trade deficit widened in December as gold imports nearly trebled, due to a rush from traders to take advantage of lower prices and a fall in exports for the 13th straight month. (TOI) § Ex Airbus COO to lead Tata Motors: Tata Motors has appointed Guenter Butschek, a former Airbus and Daimler executive, as CEO and MD. He will be the third expat to lead the maker of Nano hatchback after Karl Slym and Carl-Peter Forster. (TOI) § Talking terms: Ambani brothers in telco tie-up: In a major strategic partnership, Ambani brothers Mukesh and Anil who lead mobile firms Reliance Jio and Reliance Communications, respectively on Monday inked an agreement to share and trade spectrum in the 800 MHz band across 17 circles. (FE) § Easwar panel makes it easier for tax payers: Small taxpayers like retirees with mainly interest income could soon be spared the hassle of facing a higher outgo as tax deducted at source (TDS) and then seeking refunds. Also, professionals with gross receipts up to Rs 1 crore may be given the facility to show just 33.3% of the receipts as income and pay tax on the same at the applicable rate, instead of going through the rigmarole of getting expenditure to that extent certified by the taxman. Experts said 90% of the professionals in the country would fall under the proposed presumptive tax rule. (FE) § Wipro s net dips, in line with expectations: IT major Wipro has reported a sequential dip in net profit of 0.06% for the OctoberDecember quarter, impacted primarily by the Chennai floods and a lower utilisation of its human resources. (FE) § Road map for new accounting standards: The finance ministry on Monday announced a road map for implementation of Indian Accounting Standards (Ind AS) converged with International Financial Reporting Standards for scheduled commercial banks, insurancecompanies and non-banking financial companies. (FE)

BANKING NEWS UPDATE

§ Increase TDS threshold,slash rate at which it applies:Panel: A committee headed by retired Justice R V Easwar, in its first report released on Sunday, has suggested enhancing the threshold limits of income (across a wide spectrum, including investment income) for the purpose of deduction of tax at source (TDS) and has also proposed a reduction in the rate of withholding taxes (the rate at which TDS is applied).(Times of India) § Implementation of pay panel award likely to be deferred: With a massive financial resource crunch estimated for 2016-17, the government is planning to defer the implementation of the 7th pay commission award. Last week the Union cabinet approved the formation of empowered Committee of secretaries to work out ways for staggering the award through more than one financial year, instead of letting the Rs 1,02,000-crore bill from the implementation of the award come up at one go. (BS) § Postal deptt to open 1,000 ATMs : The Department of Posts (DOP) plans to open 1000 ATMs and bring all 25000 departmental post offices under Core banking system by March this year.It has already rolled out core Banking system in 12,441 post offices along with 300 ATMs,a DoP official said. (IE) § MUDRA not to regulate micro finance institutions: Govt: Clarifying its stand on regulation of microfinance companies, the government has said that the Reserve Bank of India would continue to regulate MFIs will not be regulated by the Micro Units Development and Refinance Agency ( MUDRA) Bank, as proposed by the finance Ministry earlier. (IE) § Coming, an exclusive insurer for Indian ships: Four state-owned insurers to float new JV; move aimed at reducing forex outgo on premiums: To reduce the insurance cost of Indian ship-ownners, the centre plans to get the four public sector general insurers to float a new joint venture. The venture will exclusively provide cover to ships operating in Indian and South Asian waters. (BL) § TPG Capital, Partners Capital Remain in Race to Acquire ICICI Home Finance: Bids at 2700-2800 crore, below ICICI Bank’s expectation of 4400 crore: Private equity firms TPG-Capital and Partners Capital are the only bidders to buy the mortgage unit of ICICI Bank, two people with direct knowledge of the matter said. (ET) § FIIs post worst first fortnight of outflows: The first fortnight of 2016 has been the most savage in terms of foreign fund outflows from India since Sebi started publishing daily data in mid-1999. Spooked by a weakening Chinese economy that has created an environment of financial uncertainty globally, foreign portfolio investors (FPIs) have taken out nearly $700 million from the Indian stock market so far this year, data collated from depositories and exchanges show .(Times of India) § Q3 earnings global cues to drive markets: Third-quarter results of blue-chips like RIL, Wipro and ITC, as well as global market trends, China GDP data, movement of rupee and oil will dictate stock market trading this week, say experts.(Times of India) § Top 7 cos lose Rs 48,763 cr in m-cap: The combined market valuation of seven of the top-10 most valued Sensex firms declined by Rs 48,762.5 crore last week, with IT bellwether TCS taking the steepest hit. While TCS, HDFC Bank ,CIL,Sun Pharma, ONGC, HDFC and HUL suffered losses in their market capitalisation (m-cap),RIL, Infosys and ITCemerged as gainers.(Times of India) § India elected to board of directors of AIIB: India, one of the founding members of the AsianInfrastructure Investment Bank (AIIB), has been elected to the board of directors of the China-sponsored AAIB, whichis expected to begin loan approvals before the end of this year .(Times of India) § ONGC arm gets $1.7 bn loan refinanced at lower interest: At a time when depressed oil and commodities prices have left companies gasping, the overseas acquisition arm of state-run ONGC has made a killing by replacing a $1.7- billion loan with cheaper credit and longer payback time.(Times of India) § India,EU officials to meet today on FTA: Senior officials of India and the European Union are expected to hold discussions tomorrow on the stalled negotiations for the proposed free trade agreement .(Times of India) § Special safeguard at WTO redundant: As India negotiates hard to secure a special safeguard mechanism (SSM) at the World Trade Organization (WTO) to protect farmers from a sudden spurt in imports, many analysts have questioned the strategy.(FE)