banks | Common News Update

Feb22021 by adminNo Comments

Banks’ NPAs decline to Rs 8.08 lakh crore in September 2020 from Rs 10.36 lakh crore in March 2018: Govt

Finance

New Delhi: Non-performing assets (NPAs) or bad loans of the banking sector came down from a high of Rs 10.36 lakh crore at the end of March 2018 to Rs 8.08 lakh crore at the end of September 2020 due to various initiative of the government, Minister of State for Finance Anurag Thakur informed the Rajya Sabha on Tuesday. As a result of the Asset Quality Review (AQR) and subsequent transparent recognition by banks, stressed accounts were reclassified as NPAs and expected losses on stressed loans not provided for earlier under flexibility given to restructured loans were provided for, he said in a written reply. Further, he said, all such restructuring stressed loans were withdrawn. Primarily, as a result of transparent recognition of stressed assets as NPAs, gross NPAs of scheduled commerc...

Dec302020 by adminNo Comments

Deposits of public sector banks surge amid pandemic stress

Finance

Kolkata: Deposits for public sector banks (PSBs) grew at a higher pace than usual despite their lower deposit rates and amid stress on a few private banks. Term deposit mobilisation of public sector banks quadrupled but it decelerated sharply for private banks, the Reserve Bank of India said. For the banking sector as a whole, term deposits – contributing almost 60% of total deposits – moderated, reflecting the easing of interest rates and the lure of returns on competing asset classes. Foreign banks aggressively raised low-cost current and saving account (CASA) deposits, although their share in total deposits is low. “During 2020-21 so far, deposits with PSBs grew at a higher pace than usual, partly reflecting perception of their safe-haven status,” RBI said in its report on Trend & P...

Dec302020 by adminNo Comments

Europe’s digital banks got a ‘wake-up call’ in 2020. And consolidation could be coming

Finance

The icons for the Monzo and Starling Bank banking apps on a smartphone.Adrian Dennis | AFP via Getty ImagesLONDON — In a year when online banking has taken off, you'd think it would be a golden opportunity for Europe's digital challenger banks to shine.Research from Mastercard last month found that 42% of Europeans handle their finances digitally more frequently than they did before the coronavirus pandemic, while 62% are thinking of switching from physical banking to digital platforms altogether.But many of the so-called "neobanks" have stumbled in 2020, with the likes of Monzo and Revolut revealing deepening losses and getting hit with a multitude of complaints from customers about service.Monzo, whose founder Tom Blomfield stepped down as CEO earlier this year, caused concern after flag...

Dec152020 by adminNo Comments

Monetary policy transmission of PSU banks stronger than private lenders: RBI paper

Finance

Mumbai: The monetary policy transmission of state-owned banks in the short-run is stronger than their counterparts in the private sector, and can be improved further with capital infusion, said a RBI working paper. The credit channel of monetary policy transmission is robust in India and its efficacy can be reinforced by better capital position of banks, said the working paper on 'Asset Quality and Credit Channel of Monetary Policy Transmission in India: Some Evidence from Bank-level Data'. "Controlling for asset quality, in the short-run, the credit channel of monetary transmission of public sector banks is stronger relative to that of private sector banks," it said. The Reserve Bank of India said the views expressed in the paper are those of the authors and not of the central bank. Ac...

Dec122020 by adminNo Comments

NBFCs set to lose market share to banks: Crisil

Finance

MUMBAI: NBFCs are set to lose market share to commercial banks specially in the retail space. After outpacing banks in terms of loan growth for more than two years, NBFCs are set to slowdown in growth as the sector faces funding challenges due to COVID induced funding challenges and competition from commercial banks, according to ratings firm Crisil. “Despite an estimated GDP growth of 10% next fiscal, overall NBFC sector growth is likely to be slower because access to funding remains a challenge due to concerns about the impact of the pandemic on asset quality" said Gurpreet Chhatwal, President, Crisil Ratings. "Additionally, competition is expected to be more intense from banks – which are flush with low-cost deposits and better placed with improved capital buffer than in the previous ye...