Tuesday, December 29, 2009

SBI predicts no immediate change in lending rates

The State Bank of India (SBI), country’s largest lender the first bank to launch special home loan scheme offering 8% interest rate, says no immediate change is likely in lending rates.

SBI chairman .P. Bhatt, who was on a visit in Jamshedpur, told the step taken by the bank in the home loan segment has benefited both the customers and real estate developers.

Bhatt said, “We reduced the home loan lending rates to 8 per cent per annum and as a result developers and customers started returning to the market. Other banks were also forced to follow our footsteps.”

He maintained that in market liquidity is in surplus but the credit growth has yet to pick up.

He added, “I don’t see any hike in lending rates of the bank in the next six months. There is enough money available in the market and banks are not facing any difficulties in providing credit to customers at this point of time”.

Monday, December 7, 2009

MoU inked between SBI and Honda Siel Cars

A Memorandum of Understanding (MoU) was inked between State Bank of India (SBI) and Honda Siel Cars India Ltd for providing auto retail financing to prospective customers.

According to company’s press release SBI will be the preferred financier for the entire range of vehicles marketed by Honda Siel Cars in India.

Honda Siel Cars' director (marketing) Tatsuya Natsume and SBI's chief general manager, personal banking business unit, P Nanda Kumaran signed the MoU.

The main aim of signing MoU is to target high-end customers who will be taking car loans of above Rs 5 lakh from the bank. SBI has launched a special scheme called SBI Advantage Car Loan Scheme for this segment. The bank release said the scheme is available for individuals – salaried, professionals, self-employed, businessmen and proprietary/ partnership firms- who pay income tax and whose income/net profit or gross taxable income is Rs2.50 lakh and above.

SBI under its car loan is giving 85% of on-road price of the car with a repayment period of 7 years as maximum applicable to all categories of customers. Bank is charging only 0.50% of the loan amount as processing fee.

The release said, the USP of the product is the loans will be sanctioned on a priority basis.

Thursday, December 3, 2009

SBT extended home loan scheme, withdrawn car loan scheme

The State Bank of Travancore (SBT) has also extended its Aishwarya Home Loan scheme till March 31, 2010, and has reintroduced processing charges.

Under this scheme the home loans taken during this period will be offered at the rate of 8 per cent (fixed) during the first year, then for the next two years the rate would be 9 per cent (fixed) on up to Rs 30 lakh and for the next two years it would charge 9.5 per cent (fixed) for above Rs 30 lakh.

According to bank press release, subsequently the interest rates for these loans after wards will be at 2.5 per cent below prime lending rate (floating) for limits up to Rs 30 lakh and at 2 per cent below prime lending rate (floating) for limits above Rs 30 lakh.

For the time being SBT has withdrawn its Aishwarya Car Loan scheme from December 1, and consequently the SBT Car Loan scheme will be available at normal rates with processing charges. The normal rates of car loan scheme charged by the bank range from 11 per cent to11.25 per cent for a tenure of up to seven years, the release stated.

Friday, November 13, 2009

SIB authorized to distribute commemorative coins on St Alphonsa

Recently the commemorative coin on India’s first woman Catholic Saint Sister Alphonsa was released by the Union Finance Minister Mr P. Chidambaram. Sister Alphonsa, who spent a quiet life at a convent in Bharananganam village in Kottayam district in the early 20th century, was conferred sainthood by Pope Benedict last year. South Indian Bank (SIB), a Kerala based lender has been authorized to distribute the coins through its branches.

The Rs five coin has the engraving of the Kerala – born nun. The distribution of coin was inaugurated at SIB headquarters in Thrissur where Dr V.A. Joseph, Managing Director and Chief Executive Officer of SIB presented few pieces of coin to Archbishop Andrews Thazhath, a bank press release stated.

The Provincial of Assisi Province of Franciscan Clarist Congregation received the coins; St Alphonsa belonged to this place.

Tuesday, November 3, 2009

State Bank expects growth in loan segment and increase in margins

Country’s top lender, the State Bank of India is expecting growth in its loan segment and margins to increase as more and more corporate are showing confidence in Asia's third largest economy which will boost in credit demand.

On Saturday, the state-run lender September quarter net profit raised by 10.2 percent taking to 24.9 billion rupees ($530.2 million) on trading gains, while there was slip in loan demand and low lending rates from core operations.

However Reuter survey of analysts had forecasted net profit at 24.6 billion rupees.

While on Friday ICICI bank the closest rival said, their net profit has increased to 2.6 percent, defeating the forecast.

It is said the increasing business confidence in Asia's third-largest economy is likely to boost the corporate, housing, auto and retail loan demand which will help Indian banks to retrieve their loan growth.

SBI Chairman O P Bhatt told reporters, "Loan growth was slow until June. After that it has picked up significantly and if the rate of growth continues we should be able to meet our targets".

in July-September there was a growth of 16.4 percent in advances, covering its 30 percent flow over the past few years but more than 13 percent sector growth, stated State Bank. The State Bank along with its associates has hold over a quarter of Indian bank loans and deposits.

Bhatt stated, it is likely to attain credit growth of 22 percent in the year of March 2010.

In the September quarter, most Indian corporate has done good earnings, which reduced the risk of rising bad debt for Indian banks.

State Bank has 12,000 branches across India and abroad, and its bad debts is estimated to have risen to 2.99 percent in the fiscal second quarter as against 2.79 percent in the June quarter.

Also its provisions for bad debts had declined to 42.9 percent in July-September as against last quarter’s 45.2 percent.

According to Analysts State Bank and ICICI Bank will be affected most by the measures taken by the central bank to raise the minimum provision ratio for bad debts to 70 percent from 10 percent by September 2010.

In view of RBI’s move the bank will be required to provide at least 50 billion rupees more to meet this target, Bhat said he is waiting for details from the RBI.

Bank there was growth of 2.55 percent in net interest margin in the quarter to September as against the 2.3 percent in the previous quarter.

The bank hopes net interest margin to push up by 10 to 15 basis points in the next few quarters as it is increasing low-cost deposits and cutting high-cost term deposits
on the other hand bank’s capital adequacy ratio, a measure of its financial efficiency was at 12.47 per cent which stood at 12.14 percent a year ago.

State Bank of India will require about 360 billion rupees over the next 5 years so that it can maintain its capital adequacy ratio of 12 percent, said Chief Financial Officer S.S. Ranjan.

Bhat informed the process of acquisition of State Bank of Indore is on track and the board has given its approval to the share swap ratio, but he refused to reveal the details.

State Bank sources said it is looking at overseas acquisition opportunities in order to strengthen its portfolio.

Bhat referring to the global credit crisis stated, "We are looking at it but in the current climate it is difficult. If you make a mistake it won't be good for us in the context of what has happened across the world".

State bank is getting tenth of its profits from its overseas operations.

In July-September shares of State Bank prized at $31.5 billion rose by 26 percent, beating a 20 percent rise in the sector index and an 18 percent gain on the benchmark index.

Wednesday, October 21, 2009

SBI ATM failed to dispense cash, paid compensation to a customer

The State Bank of India was directed by the District Consumers’s Forum to pay Rs 3,000 as compensation to a customer as an automated teller machine (ATM) of the bank could not provide him cash.

Forum President Iqbal Ahmad said, "The compensation must be provided to Mr Rajesh Kapale in a month".

Kapale resident of Noniya Kardal has an account at the local SBI branch. On February 10, 2009 tried to withdraw Rs 15,000 from the ATM but machine dispensed a slip mentioning that the transaction could not be processed. Kapale had adequate funds in his account.

He wrote a letter to SBI officials but did not obtain any response.

The Bank agreed that on February 10 the ATM was non-functional for some hours and Mumbai was alerted about this.

SBI, LIC proposes to introduce Islamic products

Senior officials of the State Bank of India (SBI), country’s largest lender and Life Insurance Corporation (LIC), the largest insurance company, informed that the two firms are planning to introduce Islamic products to tap the investment habits of Muslims in the country.

Following this the SBI officials over the past few days have been meeting top experts in the field while a team of LIC officials has been set up to study these products. The Reserve Bank of India recently conducted a study and reached to a conclusion that it might not be possible to include Islamic banking in the current regulatory structure in the country.

However LIC chairman TS Vijayan told ET the corporation has set up a team to study Takaful, the insurance equivalent of Shariah-compliant Islamic banking. Through insurer’s representative office in Singapore the product will be offered to cater the Malaysian and Indonesian market.

Mr Vijayan informed, “We have put a team to study Takaful products. We are looking at this product for our Saudi operations where Takaful is coming up”.

At SBI the process is in the preliminary stage. SBI deputy general manager, overseas expansion and planning, Naresh Malhotra told, “We have been studying the feasibility of launching Islamic banking in terms of the products that can be offered and the systems that need to be put in place”. He along with a team of officials at the International Business Group, have been meeting several experts to study the legal and regulatory obstructing from launching Shariah-compliant products.

SBI is the latest entry in the growing list of firms which are trying to get hold on the investment habits of around 142 million Muslims in the country. However, over the past few months, two mutual fund schemes have been launched which are operating on a Shariah-compliant basis. Two more insurance companies have launched special pension fund schemes. Recently the Kerala government has also announced that it is thinking of setting up a Shariah-compliant NBFC, capitalized at Rs 1,000 crore.

Mohammed Hussain Khatkhatay, noted expert on Islamic banking pointed out, “Islamic banking could be introduced by effecting changes through notifications of RBI and without a change in law”. He added that for this strong political will is required from the government side which might be difficult to bring about.

Regarding this recently RBI constituted a working group under the chairmanship of Anand Sinha, an executive director. The group in its report stated that it is not possible to introduce Shariah-compliant instruments in the current regulatory structure.

Thursday, September 17, 2009

SBI’s business per employee lower than industry average

According to RBI report for the year 2008-09 the productivity of the State Bank of India’s employee stood at Rs5.56 crore which is below the estimated industry average of Rs7.50 crore for the year.

While the country’s largest lender’s wages as percentage of total expenses accounted to 16.64% as against the industry average of 13.52% for 2008-09.

As per the RBI report on profile of banks, business per employee (total business of the bank divided by the number of employees) of IDBI Bank stood at Rs20.30 crore and that of Punjab National Bank at Rs6.54 crore.

While the business per employee of Canara Bank stood at Rs7.80 crore, Bank of Baroda at Rs9.14 crore, Bank of India at Rs8.33 crore and Union Bank at Rs6.94 crore for 2008-09.

In comparison to public sector banks, country’s private sector banks have done fairly well with the business per employee of ICICI Bank and Axis Bank being at Rs11.54 crore and Rs10.60 crore, respectively for the last fiscal.

Also the foreign banks’ employee productivity has been higher in comparison to the industry average with Citibank, HSBC, Standard Chartered Bank and Barclays business per employee at Rs18.80 crore, Rs9.61 crore, Rs9.71 crore and Rs11.10 crore, respectively.

ICICI Bank’s profit per employee has been higher at Rs 11 lakh, among the private lenders while the HDFC Bank average has stood below at Rs 4.18 lakh.

Thursday, September 10, 2009

SBP announced Festival Bonanza- offers 3 new home loan schemes

There is a competition among the banks of offering best festive offers. The State Bank of Patiala has launched a Festival Bonanza with 3 new Home Loan schemes on liberal terms and conditions. According to bank’s press release the schemes will be applicable from September 1 to November 30, 2009. The release said the schemes have been launched to cater the customer’s need for attaining home loan at affordable rate of interest.

Under HI-Five Home Loan scheme SBP is offering a fixed rate of interest at 8% p.a. for 5 years for the loan of up to Rs.5 lacs. The loan repay back period has been set for 10 years. Under Easy Home Loan scheme SBP is offering a fixed interest rate of 8% p.a during 1st year 8.50% for 2nd and 3rd year. The maximum loan amount under this scheme is Rs.50 lacs and maximum repay back tenure is 25 years.

While under Advantage Home loan scheme SBP is offering 8% p.a interest for 1st year and 9% p.a. for 2nd and 3rd year. The scheme will be offered on above Rs.50 lacs for the period of 25 years. The bank will not charge any pre-payment penalty in case the borrower opts to pre-pay the loan at the time of reset in all variants. Processing fee has also been completely waived off up to 30.11.2009.

Wednesday, September 2, 2009

SBI see surge in mobile banking customers

More and more customers are opting for mobile banking facility. According to banks data in the last two months there have been increase in the number of customers registering for mobile banking facility. The main reason behind this increase is a steep rise in small-value transactions.

A senior SBI official informed that in the last two months more than 20,000 customers have opted for mobile banking and in the future more are expected to add.

The official told press, "Both customers and bank branches have realized the immense potential of this service, especially when it comes to small value transactions. We have seen more number of customers availing this service in the July-August period."

As on date around 33,000 clients have registered for mobile banking with SBI as against 10,000 in May this year.

Thursday, August 13, 2009

SBI announce fresh offers in the housing finance segment

The State Bank of India announced fresh volley in the housing finance segment in which it has capped the interest rate at 8 per cent for five years loans of up to Rs 5 lakh.

The bank stated it will offer loans up to Rs 50 lakh at 8 per cent for the first year and 8.5 per cent in the second and third years. Recently SBI has become aggressive in the highly competitive home loan market, which was earlier dominated by HDFC.

Currently HDFC is offering home loans up to Rs 15 lakh at an interest rate of 8.75 per cent. For loans between Rs 15 lakh and Rs 30 lakh and that above Rs 30 lakh, bank is offering 9% and 9.50% for 20-year tenure respectively.

Currently SBI’s home loan offers are the cheapest one in the market.

Earlier in February SBI announcement had astonished the market when it capped the interest rate on all home loans at 8% in the first year. It made the offer more attractive in June when it set a Rs 30 lakh cap for its Easy Home Loan Scheme, under which it fixed interest rates at 8% in the first year and 9% in the second and third years.

Latest SBI has announced a three-month long “SBI My Home Campaign” from August 8 to make easy for home buyers during the forthcoming festival season. The bank stated no processing fees will be charged on home loans.

Thus the individuals can take loan up to Rs 5 lakh under SBI Hi-Five Home Loan at an interest rate of 8% for a period of five years. Therefore the customer gets an option to choose between floating rate of 2.75 per cent below the State Bank Advance Rate (SBAR) and a fixed rate of 1.25 per cent below the SBAR for a further loan term of five years. However the SBAR is the bank’s benchmark rate and stands at 12.25 per cent.

The borrowers who take home loans up to Rs 50 lakh will get an option that at the end of three years they can choose between a floating rate of 2.75 per cent below the SBAR and a fixed rate of 1.25 per cent below the SBAR. But the tenure for these loans can stretch up to 25 years.

P. Nandkumaran, general manager, retail loans at the SBI, in an interview told The Telegraph that in the second scheme the effective interest rate of around 8.71 per cent will be charged for the entire tenure of the loan.

He added, “No bank now offers that kind of rate and if we were to minus the processing charges, the effective rate will come down further by another 10 basis points”.

Nandkumaran informed that home loan sanctions have jumped to Rs 2,100 crore a month from Rs 1,500 crore since its offer of 8 per cent interest rate scheme. He said, “We expect a much better response from this scheme”.

According to analysts although the SBI home loan segment has seen rise in the share over the past six months, but HDFC still continues to be the leader. At present SBI’s market share in the home loan market stands to be a little over 20 per cent. Though the current figures of the country’s largest home loan financier HDFC is not known but the corporation, during the fiscal year ended March 31 had market share of 40%.

Thursday, August 6, 2009

SBI auto, home loans registered growth of 22% by June end

State Bank of India, during the last one year has witnessed a considerable increase in its retail loan portfolio. Between July 2008 and June 2009 the total retail advances increased by 22.52 per cent which amounted to Rs 112,862 crore.

There has been fastest growth on a year-on-year basis in the education loan segment among the various retail loan portfolios, while auto loans increased by 29.05 per cent and home loan registered a growth of 24.00 per cent on a year-on-year basis.

Bank education loan portfolio registered a growth of Rs 7,162 crore by the end of 2009 as against Rs 5,099 crore in the same period previous year which means a 40% increase in the portfolio.

In India SBI is the largest education loan provider and by the end of March 2009, it had approximately disbursed 24% of the total education loan distributed by all public sector banks put together.

The figures were made public in quarterly report of the bank released on Thursday.

In case of auto loan portfolio by June 30, 2009 the bank had distributed loans amounting to Rs 10,399 crore as against total auto loans of Rs 8,059 crore in the previous year, thus attaining the growth of 29.05 per cent, the highest among all banks.

To increase its market share in the auto loan portfolio SBI this year had launched a special auto loan scheme called SBI Ezee car loans, under which the bank offered 8% per interest for the first year.

While the home loan portfolio registered a growth of 24.00 per cent on a year-on-year basis. The bank by June 30, 2009 had distributed home loan amounting to Rs 57,513 crore as comparison to Rs 46,370 crore previous year.

Earlier this year SBI had introduced a special home loan scheme under which it offered loans at 8% in the first year.

Thus SBI maintains that it has been the fastest growing home loan provider during the first quarter of the present financial year.

Personal loans also come under retail loans but bank did not provide separate figures for this segment.

Friday, July 24, 2009

SBI to launch banking plaza – the 24-hour banking

Soon India’s largest lender the State Bank of India (SBI) will be opening a banking plaza at its main branch. This was informed by Sanjaya Dikshit, DGM of the main branch.

On Sunday the DGM held a meeting with customers and non-customers in which he revealed about the plans of opening a banking plaza. He told the banking plaza will be opened at the main building and will work on the concept of 24-hour banking under which customers can avail all the facilities (from operation of account to loan sanction) of banking under one roof.

He told in the meeting there was a good interaction with the customers and got feed back along with suggestions from its respected customers. In the meeting before the interaction session bank officials informed the guests about the various schemes, new schemes and facilities bank is offering. During the interaction session customers gave some good feedback and suggestions which can help the bank in offering better services.

The DGM also informed the guest that bank is giving car loans and housing loans at the rate of eight per cent for the first year, the lowest rate of interest being offered by SBI in the banking industry. Along with him Suresh Sharma and Shashikant Khandekar were also present in the meeting.

Monday, July 13, 2009

SBI get first-stage nod for general ins biz in tie-up with Insurance Australia Group

Insurance regulator Insurance Regulatory and Development Authority (IRDA) has given first-stage approval to State Bank of India (SBI) for its general insurance business.

SBI will start its general insurance business in collaboration with Insurance Australia Group.

IRDA Chairman J Hari Narayan told press, "We have given first-stage (R1) approval to SBI for the general insurance company. There are a total of three stages (of approvals)".

He informed that IRDA SBI will be granted full approval when it will apply for it.

Hari Narayan said, "The ball is in their (SBI) court. It is up to them -- when they apply for the remaining two stages".

SBI will be starting its general insurance joint venture in the fourth quarter of the current fiscal.

SBI, the public sector lender, is already having a life insurance joint venture with BNP Paribhas Assurance--SBI Life Insurance.

Thursday, July 9, 2009

SBI chairman says interest rates can be hiked in 6 months

On Tuesday the chairman of State Bank of India, the country's biggest lender, said since last October the interest rates have been falling but there are chances that interest rates might get strengthen in six months as credit is picking up. O.P. Bhatt informed reporters as the increase in business activity can be seen which in turn will result in higher loan growth in the second half of the year. He added, "Six months down the line with credit rising and the entire borrowing taking place, rates will either stabilize or even harden".

"There are lots of signs available in the economy that business activity is increasing across multiple sectors. But it is still not showing up in bank lending. We believe that with time lag it is going to happen." Since last October the central bank has cut its main lending rate by 425 basis points in order to boost the slowing economy and state-run banks responded to this by reducing rates by 150-200 basis points. State Bank, along with its associates controls a quarter of the Indian bank loans and deposits; on June 24 it reduced its lending rate by 50 basis points. Since November its benchmark lending rate has declined by 200 basis points since November. In November Indian bank loan growth has come down from around 27 percent in to about 15 percent in June and rates have halved to around 30 percent seen in the financial year to March 2008. Bhatt addressed the reporters after he along with other bank chiefs met the central bank governor, D. Subbarao, before a quarterly monetary policy review on July 28. He told in the meeting the main focus was on the current "liquidity overhang" in the system and managing government borrowing without stress. Finance Minister Pranab Mukherjee said in the budget on Monday the fiscal deficit will touch a 16-year high of 6.8 percent of gross domestic product and the government will have to borrow from the market to reduce the shortfall.

Bhatt added commercial banks have requested the Reserve Bank of India (RBI) to extend loan restructuring program till December. Last year the central bank has allowed banks to re-set terms of some loans where they are not receiving repayments regularly, except for real estate and personal, to avoid them from being accounted as non-performing loans in the course of an economic downturn. "We have asked RBI to extend loan restructuring deadline as it is taking lot of time as cases of consortium lending involves multiple banks," Bhatt said. Shares in State Bank, which having a market value of $22 billion, ended down 1.1 percent lower at 1,636.35 rupees in a Mumbai market that rose 0.9 percent.

Tuesday, July 7, 2009

SBI promises promotions to top levels and overseas postings to prospective executives

State Bank of India (SBI) is looking for 500 management executives therefore it is looking for best talent. Therefore bank is promising to its prospective management executives a promotion to top levels as well as postings in overseas branches.

The bank said, it has prepared an “attractive promotion policy to reach the top levels of the bank” along with an “attractive compensation package”.

In addition, “an unmatched opportunity to experience the rich diversity of India through posting at various places and also foreign locations” is also being publicized.

SBI in its recruitment notice for the management executives has stated, “The bank has a massive and unmatched distribution network of 11,655 domestic branches, reaching every nook and corner of the country, 92 foreign offices spread over 32 countries covering all time zones as well as world-class technology base providing st ate-of-the-art virtual banking channels”.

It further added, “On an ever expanding banking horizon, globalization has opened up infinite business opportunities at home and abroad.”

Earlier SBI has mentioned that in the current fiscal, the bank will be recruiting 33,703 new hires of 2008-09 and also has the plan for the recruitment of 13,000 employees in 2009-10.

Friday, July 3, 2009

SBS successful merger with SBI builds confidence for future M&As

State Bank of India (SBI) will be finalizing the merger of State Bank of Indore with itself in the next twelve months.

Meanwhile the State Bank of India (SBI) Chairman O P Bhatt has received the final approval from the government on the proposal to merge State Bank of Saurashtra (SBS) with the parent bank on August 13 last year.

Precisely a month later, SBI has incorporated the systems of the two banks. Jeevan Das Narayan, general manager in the SBI’s mergers and acquisitions (M&A) cell said, “It was an overnight operation and next morning, when people logged in, no one even realized that we had moved to a common platform”.

The good experience the banks have attained has given the M&A cell the confidence to complete a second merger – with State Bank of Indore -- within the next 12 months.

Bharati Rao while sitting in her 18th floor office at the SBI headquarters, advisor in-charge of the bank’s M&A cell, is closely examining the feedback her team is receiving on the bank’s proposal to acquire State Bank of Indore, its smallest associate bank.

However, bank’s discussion board has received an optimistic feedback from ‘Jai ho’ to ‘Yeh to hona hi tha’. Although the employees union has called for a strike after the two boards have approved the plan 10 days ago, Rao isn’t too disturbed.

After the merger over 6,000 State Bank of Indore employees will get the benefit of pension and better healthcare. Rao stated, “But it’s not just about better facilities. A big benefit is that post-merger; State Bank of Indore employees can also work for a large financial conglomerate that has interests in insurance, mutual fund and pension”.

Similar to SBS case, top executives from SBI and State Bank of Indore will be shortly holding consultations with employees and clients of the Bhopal-headquartered body to explain the rationale and benefits of the merger.

Rao, who was earlier deputy managing director at SBI stated, “Most customers do not like dislocation. We need to tell them that they will have access to all products and services that they use at present and may get some more. A lot of times pricing at SBI is much better”.

The strategy adopted will be simple. The large clients will be common; some of the smaller ones will be serviced by the mid-corporate group. In case of SBS, the only upsetting for clients has been that some of them are now being serviced by SBI’s Ahmedabad office, instead of the SBS head office at Bhavnagar. The helping point in this case was that senior SBI executives led by Bhatt met clients to alleviate whatever fears they had.

But the main focus is on employees, as they are the ones who make a merger a success or a failure. Once more, it is the SBS experience that SBI is banking on, though with minor variations.

In the beginning, some executives from State Bank of Indore will be joining Rao’s team to make sure a smooth merger. Besides, the entire staff will be given training in batches to ensure problem-free system integration. In case of SBS, SBI had given six months training almost the entire 7,000 employees of the former.

Incorporation of employees is something that Rao’s team had worked on very closely since the last public sector bank merger of New Bank of India with Punjab National Bank is still causing heartburns to the employees of both the banks, who are still bitter about delay in promotion.

Therefore SBI examine the data on promotions over a five-year period, worked on nearly half-a-dozen models, hired a consultant and then finalized the policy. And, to fight off any problems later, SBI even got legal opinion to endorse the move.

In smaller bank, the chances of promotion are higher. As, there were only 2,000 officers at SBS, over 90 per cent of whom were in ranks up to AGM. While at SBI, there were nearly 50,000 officers. Although all SBS officers have joined at the same level and their seniority has not been affected, the promotion policy predict that it will take one year extra for an SBS officer to get a promotion. In case an SBI officer is eligible for promotion in four years, it will take a former SBS officer five years.

The other area of focus is to ensure that there is no disturbance at the branch level. At the head office in Bhavnagar, the three zonal offices in Gujarat and at the two regional offices in Mumbai and Delhi, the clerical staff is redeployed. But some 500 officers were shifted to the Ahmedabad branch. But in the zonal and regional offices, it was ensured that officers up to the level of chief manager were not moved outside the state.

A senior executive of SBS, who is at present part of the SBI set-up, said that the policy has worked out well, at least so far. “State Bank of Indore employees know exactly what was given to the SBS staff. So, that part is clear now,” said Rao.

Although she is unwilling to discuss the plan for the remaining five associate banks, SBI’s policies have been worked out carefully over the last two years or so. “The thought was, let’s give it a try. If it works out, it’s wonderful, if it does not, its okay,” said a senior SBI executive.

A merger is right decision as there is too much of duplication. For instance, there are many places where an SBI branch is competing with one of its associates in mobilizing deposits and giving out loans.

“All the seven banks have an establishment cost, which can be one and we can work in unison. They have strong presence in some areas which we can make use of,” Rao said.

If SBI is able to merge all the associate banks, its branch network will increase nearly by 40 per cent, while the profits would be 30 per cent extra. And, to top it up, there will be significant savings. The SBS merger has already led to subsequent savings of a few hundred crore though no firm assessment has been made, bank executives informed.

“Given the common ownership, common technology platform and a common chairman, that should not be tough… At the front-end, there was no change for the customer -- the logo is the same, though there were some changes in the stationery and the boards at the branches,” Rao added.

So, what after State Bank of Indore? No one at SBI is ready to reveal anything. But what makes SBI’s measure unique is the fact that none of the other public sector banks have taken any action beyond giving their support for consolidation. Maybe they might illustrate upon SBI’s experience to pull off mergers, whenever they finalize one.

Wednesday, July 1, 2009

Merger of State Bank of Indore to take place with parent bank SBI

In a recent meeting with bank chiefs the Finance Minister, Pranab Mukherjee had approved the consolidation process among the State-owned commercial banks, following this State Bank of India (SBI) has begin the process of merger.

Working on the same line on Friday the board of State Bank of Indore passed a declaration to open the way for the merger process with the SBI. At present the SBI is holding 98.05 per cent stake in State Bank of Indore, a smallest associate bank.

Following this the SBI board met in Mumbai has passed a declaration for the merger of State Bank of Indore with the parent bank. This is the second associate bank to be merged with the parent after the State Bank of Saurashtra in July 2008. In case the merger process of State Bank of Indore gets through then only five associate banks will independently exist within the Group they are State Bank of Hyderabad, State Bank of Mysore, State Bank of Bikaner and Jaipur, State Bank of Travancore, and State Bank of Patiala.

The latest consolidation process is being taken up in spite of the Government-Reserve Bank of India appointed Committee on Financial Sector Assessment (CFSA) which recommended that banks should not be reckless in merger process in the current economic conditions. According to the RBI Deputy Governor, Dr K. C. Chakrabarty the current economic environment is not matured for consolidation among the public sector banks and there main focus should be on financial inclusion.

In 1960 State Bank of Indore became a subsidiary of the SBI. The bank is having around 500 branches, with as many as 357 in Madhya Pradesh. By the end of the fiscal year March 31, 2009, it has made a recorded profit of Rs 278.92 crore. As on March 31 banks total business accounted to about Rs 50,500 crore. It is having a network of 400 automated teller machines (ATMs).

On Friday in Indore a board meeting of State Bank of Indore was held in which the workman-director, Mr Atul Pradhan, gave a nonconforming note on the declaration that was taken up in the meeting as a table agenda.

Sources closely related to the developments said the board approved the declaration by a majority vote with five members in favor of the proposal and only one (the workman director) nonconforming.

Mr Alok Khare, President of the All India Bank Officers’ Association, told Business Line in the meeting there was no officers’ representation as the board seat for officers is currently vacant.

Banking industry observers said that it would be remarkable to see if the proposed merger of State Bank of Indore with SBI will come under the scrutiny of the Competition Commission of India (CCI). Although the CCI is functional, the provisions related to regulation of combinations under the Competition Act are yet to be reported.

Wednesday, May 13, 2009

Bank reaches at the doorstep of the villagers

People living in villages, such as Shivaji Gulab Dhegre, 22 an owner of a small paan shop in Ghotawade village in Mulshi Taluka, 30 km from Pune, never had a bank account and also have never thought of opening one as they earn just enough income to make both ends meet.

As new technologies are being adapted by the Indian banking industry to take banking to the far away villages, working on the same line Financial Information Network and Operations (FINO), a Mumbai-based Biometric-enabled smart card solutions provider, along with the State Bank of India (SBI), is making a unique offer to Dhegre and the 2,000-odd people of the village, mostly farmers and workers of nearby factories: a bank account (without a passbook), where they can deposit an amount as low as Rs 10.

The most interesting part of this offer is the villages don’t have to go to the bank to deposit or withdraw money. The bank will reach their doorstep.

Ashish Rath, a management trainee with FINO, who is looking after the company’s ground operations in Ghotawade, explained, “The accountholder is provided a biometric smart card, which has personal information and fingerprint details. When the accountholder needs to withdraw or deposit money, all he/she needs is to do is swipe the card on a special machine called the Point of Transfer (POT) machine, and enters the PIN number. All agents of FINO, who go door-to-door, carry the machine.”

A person can deposit a maximum amount of Rs 50,000. In case a customer deposits money more than the limit then, his account is upgraded to the main SBI branch. Kanhaiya Lal, a factory worker, who is ready to open an account, said, “Even if you have a regular bank account, it makes sense to open this account, because the nearest SBI branch is at Pirangut, 8 km away, and the nearest ATM is at Hinjewadi, 25 km away.”

The process of opening an account has been kept simple. One has to just provide the name, address and the amount of land one owns, if any. There is minimal paperwork or extra documents are asked for. Two months back the process was introduced in Pune district, the company is having 4,500 customers in four talukas, Rajgurunagar, Mulshi, Daund, and Ambegaon, informed Sachin Bhahiti, FINO’s district co-ordinator.

The first batch of 60 customers was given their smart cards at Rajgurunagar last Wednesday. Bhahiti is expecting to enroll 2 lakh customers across the district in the next eight months. Rishi Gupta, Chief Financial Officer, FINO informed, “We have a customer base of 5.5 million across the country. We expect Pune region to add to that substantially.”

Tuesday, May 5, 2009

PSBs headed by SBI to open at least 15,300 ATMs

Recently the Reserve Bank of India has liberated the norms on setting up of ATMs therefore public sector banks (PSB) have drafted enormous development plans to set up at least 15,300 ATMs across the country by the end of this fiscal year.

Under this expansion plan five leading state-owned banks, headed by State Bank, will be setting up 15,300 ATMs to help retail customers, for whom the service has become free from April 1 this year after the implementation of the RBI directives.

State Bank Group, is having the largest number of ATMs in the country, will be opening 13,400 more ATMs in the current fiscal after which the total number will increase to 25,000 by end-fiscal, an SBI official informed.

The official said, "Customer retention, particularly in the retail segment, necessitates setting up of large number of ATMs.

Presently, State Bank Group has 11,600 ATMs pan-India. We plan to more than double this number this fiscal”.

Recently, in the norms related to ATMs, Reserve Bank had permitted banks to open offsite ATMs without its prior approval. The apex bank has also allowed free usage of third party ATMs for customers from April 1.

However, banks have been allowed to charge Rs 18 per transaction from each other for every third party ATM transaction.

Wednesday, April 22, 2009

SBI for term loans and working capital for SMEs freeze rates at 8%

State Bank of India, the country’s largest lender, has freezed interest rates at 8% on certain term loans and working capital for small and medium enterprises (SMEs).

Bank will be freezing interest rates on working capital assistance up to September 2009, while bank informed that loans up to Rs 5 lakh, which are covered under the Credit Guarantee Trust for Micro and Small Enterprises, will be frozen for two years.

Moreover, for new SMEs with fund-based loan requirements of between Rs 5 lakh and Rs 25 lakh, the bank is offering a fixed rate of 10 per cent a year for the next two years.

B S Bhasin, the bank’s chief general manager in-charge of SMEs, told that the lending rates for new term loans of up to Rs 5 lakh are in the range of 8.5 per cent to 10 per cent. While the term loans between Rs 5 lakh and 25 lakh, rates vary between 9 per cent and 11 per cent. The bank, is having around 1.2 million SME clients, and has already announced two products for the small industry segment – SME Care and SME Help.

In SME Care, bank offers an additional working capital facility of 20 per cent of the fund-based limits in order to take care of inventories even of delayed payments from their buyers due to the current downturn. While SME Help is a term loan product being offered for the purchase of fixed assets, including generator sets.

However SBI has not involved in the latest round of reduction in benchmark prime lending rates, but it has decided to offer specialized packages for home, auto and SME loans where it has freezed interest rates for a specified period of time at 8 per cent and would go back to to the prevailing level once the special offer is over.

Besides this, Bhasin explained that SBI has been insistently restructuring loans of SMEs that are facing temporary cash flow problems. Till now, the bank has instigated restructuring in about 41,000 cases out of the 800,000 accounts. The sectors which had come under high stress due to slowdown in demand and financial crisis are textiles and auto components. At the end of March 2009, the bank’s outstanding SME loan portfolio stood at Rs 1,00,000 crore. SBI for the current financial year, has a target of 24 per cent growth from the segment with main focus on segments such as chemicals and pharmaceuticals.

A bank executive informed, “The garments and auto sectors are showing signs of revival. But developments have to be watched carefully”.

Friday, March 6, 2009

SBI, IDBI, Yes banks slash deposit rates by 25 to 75 basis points

State Bank of India (SBI), country’s largest lender slashed its deposit rates by 25 to 75 basis points on various slabs. IDBI Bank and Yes Bank following the suit also slashed the deposit rates by 25 to 75 basis points across various maturities. It is expected more banks will be revising their deposit rates in line to these banks.

SBI has reduced its deposit rates by 40 to 50 basis points on various slabs. Bank has cut interest rates by 40 basis points to 8.10 per cent on deposits for a period of one year to two years. While on deposits for any length of time between two years and 1,000 days bank is offering an interest rate of 8.5 per cent against 9 per cent earlier.

Likewise on the deposits above 1,000 days and less than three years bank has cut by 50 basis points to 8.25 per cent. According to bank sources the new rates will be effective from March 9.

IDBI Bank has also announced cut in its deposit rates for one-to-three years, 1,100 days and more than three years up to 10 years by 25-50 basis points. The new rates will be applicable from March 6.

C S Jain, head of retail at IDBI Bank explained, “We have brought down deposit rates to reduce the cost of resources. Even after this revision, our rate structure would remain attractive compared to other banks”.

Private sector lender Yes Bank has reduced deposit rates across maturities by 25-75 basis points. Interest rates on deposits with tenures of more than a year up to two years were lowered by 75 basis points to 9.25-9.50 per cent, depending on the amount deposited.

Likewise, the deposit rates of more than two years time period have been reduced by 25 basis points. Therefore, the new rates range between 8.75 per cent and 9.25 per cent, depending upon the deposit amount.

IDBI bank has also reduced the lending rates of its floating home loan rates by 50-100 basis points. Now the new floating interest rate will be 9.75 per cent for loans up to Rs 20 lakh and 10.25 per cent for loans above Rs 20 lakh. The new rates will come into effect from March 3.

However for loans up to Rs 30 lakh, IDBI Bank has cut down the margin money from 20 to 15 per cent. Also, for loans above Rs 30 lakh, the margin money has been reduced to 20 per cent from 25 per cent.

On Friday Reserve Bank of India (RBI) Governor Duvvuri Subbarao held a meeting with the bank chiefs to discuss the interest rate scenario. The central bank mainly pushed the private sector lenders to reduce loan rates as they have so far cut down interest rates by only 50 basis points. The public sector banks have reduced rates by up to 200 basis points.

After the meeting on Saturday some banks such as Punjab National Bank (PNB) and Union Bank of India reduced home and auto loan rates.

PNB announced cut in car loan rates by 50 basis points, Union Bank slashed rates on home loans by 25-100 basis points and car loans by 125-150 basis points. A Union Bank executive explained, “Our deposit rates are the lowest in the market at around 8 per cent, so there is little scope for further reduction”.

Earlier SBI has freeze home and auto loan rates at 8 per cent and 10 per cent respectively for a year.

C S Jain, head of retail, IDBI Bank notify, “We have cut deposit rates to reduce the cost of resources. Even after this revision, our rate structure would remain attractive compared to others”.

Wednesday, March 4, 2009

SBI introduce new system- transaction through fingerprints

The State bank of India (SBI) country’s largest public sector bank has cropped up a new technique for transactions. Under the new technique the transactions would be card-less and will require only an account holder’s fingerprints.

The bank with a view to lower the cost of transactions has decided to give out with cards, especially for the distribution of social security pensions and wages under the National Rural Employment Guarantee Scheme (NREGS).

The new system will be implemented across the country and for this a point of sale (POS) machine, comprising bio-metric details of account holders will go to a particular village where the bank’s customers would be able to withdraw or deposit funds using the fingerprint-based method.

Previously, each account holder was issued a card with a magnetic strip that was swiped at the POS machine before any transaction. The smart card was priced according to its memory. For instance, 4GB cards cost Rs 75, whereas it costs Rs 140 for a 32GB card.

NREGS was set up in 2004 since then SBI had disbursed around 1.6 million smart cards across the country, before taking a decision of shifting to the new system a couple of months ago. S Mukhopadhyay, deputy general manager in the bank’s rural banking department said, “In the last two months, we have opened more than 400,000 accounts but we have not disbursed any smart cards thereby saving close to Rs 3 crore.”

One more reason behind bank’s switching to the new system is the fact that 2% of the no-frills account holders stepped out of their villages. As most of the account holders just access the bank to receive the pension or the NREGS payment, therefore a banking correspondent can easily go with a POS machine at periodic intervals to help them complete their transactions.

“These villagers do not require inter-operability, which a smart card offers, since most of them use their accounts only once a month to avail of the NREG scheme, practically the accounts remained dormant for the rest of the month. Therefore, it was not cost-effective for the banks to carry on with cards,” an SBI executive said.

However other banks, have not yet decided to shift to card-less transactions. An executive of a public sector bank told, “Different banks use different technologies and we are sticking to a card-based system, at least for the time being.” Another banker while expressing his views said the cost-saving is not important.

Tuesday, February 17, 2009

SBI, PSBs likely to further cut rates

After a meeting with Finance Minister Pranab Mukherjee SBI chairman O P Bhatt briefed reporters about the possibility of public sector banks led by State Bank of India (SBI) will look at further interest rate cuts. He told that the bank is thinking of cutting its prime lending rate (PLR) for the second time in as many months.

Earlier on January 1 SBI had cut PLR 75 basis points to 12.25 per cent and has also cut all new home loan rates to 8 per cent for a limited period with a clause to reset rates after one year.

Finance Secretary Arun Ramanathan notified after public sector bank chiefs met Mukherjee, “Since deposit rates have come down, there is a general expectation that interest rates will come down”.

Kolkata-based UCO Bank Chairman S K Goel told the bank might cut lending and deposit rates 200 basis points, with a 100-basis-point reduction possible this month. The bank soon will be launching a scheme similar to SBI’s.

United Bank of India informed that it will cut its PLR 50 basis points soon.

While Punjab National Bank and Bank of India informed they will be cutting interest rates after inflation dips further and Bank of Baroda and Bank of Maharashtra said they will review the rates after a fortnight. Canara Bank also seems to cut down lending rates for all sectors.

Mukherjee pointed out the government will focus on boosting domestic demand. “In view of contracting global demand, we have to focus on domestic demand by primarily stimulating demand in the rural areas and highly labor-intensive sectors,” he said.

The banks have been advised to increase credit to productive sectors like infrastructure, small and medium industries and textiles, among others.

On the other hand since September last year with an aim to boost the economy, the Reserve Bank of India (RBI) has taken a series of measures including cuts in the cash reserve ratio and the repo and reverse repo rates to inject liquidity into the system and signal a soft interest rate regime.

But last week RBI said banks can reduce rates further. However since November, public sector lenders have reduced lending rates up to 200 basis points, while private banks have lowered rates 50 basis points. In comparison to this, deposit rates have been reduced up to 300 basis points.

Bankers are not willing to cut lending rates further as they claim that the cost of deposits has not come down significantly. They told further cut in deposit costs will result in investors shifting to small savings schemes such as post office deposits and public provident fund, which offer 8 per cent returns.

Tuesday, February 10, 2009

SBI to review on rate cuts in ALCO meet

State Bank of India (SBI) Chairman O P Bhatt while indicating at interest cut in the near future notified that although several banks have cut down their rates in the recent past but these have not been done in a uniform way and across the industry.

He informed the reporters, "In the past 2-3-months, there have been some rate cuts by banks but these have not been across the industry and not uniform."

He pointed out there are possibilities that banks might cut rates around March, and added that there is enough liquidity in the system.

When asked about more cut in PLR and other interest rates by SBI, Bhatt pointed out that its "asset-liability committee (ALCO) meets every week" and would look into the matter.

Bhatt further stated, "We will factor in the policy inputs" along with other factors (while taking a decision on its rates).

He stated SBI is amongst the first banks to reduce its prime lending rate (PLR) as also its deposit rates.

He informed, "SBI reduced its deposit rates by 1.50 per cent".

Thursday, January 29, 2009

SBI awarded 2 IBA Award

State Bank of India has bagged two prestigious awards from Indian Banks Association namely "RURAL BANKING INITIATIVE "AND "BEST IT ARCHITECTURE". The award was given on 20th January 2009 in the IBA & TFCI's 5th Annual Banking Technology Awards function, 2009 held at Mumbai.

SBI is having a network of 4261 rural branches in Rural Banking Initiative, which is a astounding 38% of its network. All these branches including diverse geographical terrains- some in the hilly and mountain raven regions like Leh at an altitude of 13000 feet above the sea level are on Wide Area Networking Platform. One of the Bank's aims is to offer service even in the remotest part of the country. In alliance with this acknowledged objective, the Bank is setting up another 1000 new branches in rural and semi-urban areas before March 2009.

In IT Architecture, State Bank of India (SBI) which is largest premier financial institution in India having a network of 11,500 branches and an additional 4600 branches of its associate banks spread across India has upgraded its IT Architecture by getting on an ambitious Core Banking System (CBS) implementation with an aim of connecting all the branches that will serve to 150 million plus accounts with a daily transaction volume of 25 million plus transaction per day. The environmental friendly feature of SBI's CBS architecture has allowed flawless edge with other IT initiatives like ATM, Internet Banking (both retail and corporate), Payment Systems (NEFT, RTGS, SWIFT, ECS, and EDI), Government Business, Financial inclusion, Treasury and Foreign Exchange.

Wednesday, January 21, 2009

SBI associates merger plans put on hold

State Bank of India (SBI) is taking steps more cautiously while progressing with the planned merger of its six associate banks with itself. SBI chairman OP Bhatt said at present there are no further merger plan on the cards. Recently SBI completed the merger of State Bank of Saurashtra (SBS) with it and post-merger integration is still on.

On being asked about the merger of other associate banks with SBI Mr Bhatt said “Nothing is on the cards.” This is clearly a huge move what the SBI top management used to project on the issue of merger till now.

Earlier SBI management was planning to take steps for merger of State Bank of Patiala and State Bank of Hyderabad with the parent bank. In the meantime, the Union government has started preparing the platform for merger of State Bank of Indore and State Bank of Patiala with SBI. These plans have been delayed.

As per bank insiders information, at present the focus is on tiding over the ongoing financial crisis and economic recession. Therefore, issues like mergers would be taken up later when things get in a better position.

SBI’s merger of all its associate banks with itself is a long-term plan, is to strengthen its presence. After the SBI-SBS merger, SBI has six associate banks in line — State Bank of Patiala, State Bank of Hyderabad, State Bank of Bikaner & Jaipur, State Bank of Mysore, State Bank of Indore and State Bank of Travancore.

According to the SBI chairman the employees of the banking group have now developed a positive attitude towards mergers. This is in spite of the fact that SBI’s employees’ associations have been protesting against the merger. However its associations had supported the SBI-SBS union.

Currently, the bank is busy incorporating its bank operations after the SBI-SBS merger. Mr Bhatt informed the post-merger rationalization will be in the areas like technology, asset management, branch banking and seniority. The chairman is of view that this experience can help the country’s largest banking group in preparing for the proposed mergers when these transpire.

In the meantime, SBI has merged its Mauritius-based subsidiary, Indian Ocean International Bank (IOIB), with SBI International (Mauritius) to strengthen its operations in the African island nation. The new unit has started its operations as SBI (Mauritius).

Tuesday, January 20, 2009

SBI registered 10% hike in auto loan demand

In Chennai the State Bank of India (SBI) and other nationalized banks have made possible the December sales major auto players after most of the private sector banks have stopped auto loans which led to decline in auto sales.

Official sources informed Express, “SBI registered a 10 per cent hike in loan demand in the metro in December, compared to the rest of the year. Normally, on an average, we receive 25 applications for loan demands per day”.

This was followed by the Cenvat cut of four per cent by the Centre and resultant decline in discounts by car majors fueling demand.

Private Banks had cut down their auto loan segments by almost 35 to 40 per cent have also contributed to the PSU bank’s lending.

Sources said, “SBI sanctioned and disbursed 372 vehicle loans totaling Rs 12.32 crore to customers of Maruti Suzuki, Hyundai Motor India, Toyota, Tata Motors and others in Chennai during this month”.

Thus the most beneficiaries of the lion’s share were Maruti customers at 30 per cent of the total disbursements and Hyundai at 25 per cent. Other vehicle manufacturers brought up the rear.

Besides this the bank did not rejected any loan demand during this month as compared to its customary five per cent rejections each month. Though, it is believed that 10 per cent applications have been returned due to lack of proper documentation.

In the meantime, the banking organization is expectant of another downslide in interest rates by 0.5 per cent in January that would further boost their loan segments.

On the other hand SBI also saw a dip in auto loan demands by 30 per cent in FY’ 09, vis-à-vis FY’08. This is due to high interest rates for auto loans prevailed till uneven a couple of months ago. As 75 per cent of the industry’s sales is dependent on bank financing for vehicles, sales were hit during the year.

Friday, January 16, 2009

SBI website was shutdown due to attempt by hackers

On Saturday State Bank of India’s (SBI) website was shutdown due to attempted attack by hackers. A senior official confirmed “There has been an attempt to disrupt the system.” But he refused to reveal any further details. Bank’s internet banking site www.onlinesbi.com was operational, but its sites www.statebankofindia.com and www.sbi.co.in were down on Saturday.

Lately in the evening, officials stated that the bank was aiming to get its website operational by 9.00pm. Afterward the bank put up a message stating that site was under maintenance and directed online applicants to clerical positions to the Institute of Banking Personnel Selection site.

State Bank of India is the country’s largest bank and is having over three million online customers. There has been increase in the number of people with access to internet banking has increased dramatically after SBI has installed its core banking solutions in over 11,100 branches across the country. In the past also, government website was attacked by hackers who left behind anti-India slogans.

In the previous year Bank of India’s website was hacked by the hackers who planted malaware on the site that installs itself on the user’s computer and transmits sensitive information to the hacker. Moreover there have been phishing attempts on customers of various banks where the hacker puts up a website identical to that of a bank to steal passwords.

On Saturday, the bank has launched a railway ticket booking facility at internet kiosks at ATM centers located in railway stations. With this all online banking customers will be able to get printed electronic reservation slips instantly through the kiosks. The kiosk can also be used for other internet banking transactions as well.

Monday, January 5, 2009

SBI likely to hire 500 ATMs to reduce capital expenditure and improve capital service

The State Bank of India (SBI) is likely to hire 500 ATMs from external agencies to reduce capital expenditure and improve capital service; this was reported by government sources.

Minister of State for Finance P.K. Bansal stated in a written reply in Lok Sabha, “It would be done on a pilot basis to reduce capital expenditure in setting up ATMs and to improve availability of ATMs to customers”.

“Besides, it will improve the quality of customer service,” he said adding: “The process of site identification for installation of ATMs has begun.”

According to the information available on the website of the bank, SBI is having over 8,500 ATMs in India, the largest network in the country.

Replying to another question, Bansal said that there is no recession in the economy.

Although in the situation of the global financial crisis, the government with a view to safeguard the growth process has announced fiscal incentive measures on 7 December.

He pointed out that there is no fiscal crisis or destabilization of markets in India.

About problems faced by investors while putting money in the initial public offer, Bansal stated that some of the problems and risk identified are related to disclosures in offer documents, non-receipt of shares after allotment, delayed receipt of refunds, non-receipts of refunds etc.