Volume XXXIII Number 10 December 4, 2017

Weeklies

BI – Business India

BusW – Business World

BusT – Business Today

CMar – Capital Market

EPW – Economic and Political Weekly

SE – Southern Economist

Eco – Economist

For(Asia) – Fortune AsiaCI – Corporate India

Newspapers

BS – Business Standard

ET – Economic Times

FE – Financial Express

FT – Financial Times

H – Hindu

HBL – Hindu Business Line

HT – Hindustan Times

IE – Indian Express

TI – Times of India

Mint – Mint

Classifications

Economy Banking Agriculture & Rural Development Industry Small Scale Industry

International Economics Labour & Personnel Management Management Miscellaneous Books

CONTENTS

A. ECONOMY 1

B. BANKING 3

C. AGRICULTURE & RURAL DEVELOPMENT 19

D. INDUSTRY 19

E. SMALL SCALE INDUSTRY 20

F. INTERNATIONAL ECONOMICS 20

G. LABOUR & PERSONNEL MANAGEMENT 21

H. MANAGEMENT 21

– 1 –

BANKERS' BRIEF Vol. XXXIII No. 10December 4, 2017

ECONOMY"ADB maintains 2017 GDP growth at 7%" – The Asian Development Bank (ADB) is sticking to its growth

forecast for India and is optimistic that growth will pick up on the back of several factors, including animproving global economy. We are optimistic of India achieving 7% growth in 2017 and 7.4% in 2018. Areport. – (TI Nov 28, 2017 p 18)

"ADB to raise annual funding to India to $4 billion from $2.7 billion" – Multi-lateral funding agencyAsian Development Bank (ADB) said it will raise annual funding to India up to $4 billion from existing $2.7billion, from next year. To accelerate inclusive economic transformation of India, ADB has decided to provideloans up to $4 billion on an annual basis including non-sovereign debt during 2018-22, said Kenichi Yokoyama,ADB country director in India. So cumulatively, India, the largest recipient of ADB, will get about $20 billionover a period of five years. – (Mint Nov 28, 2017 p 7)

"All growth drivers will be in place in FY19, says Ahya" – Edited excerpts from an interview with ChetanAhya, co-head of global economics and chief Asia economist at Morgan Stanley. He says in FY19, all thegrowth drivers will be in place. 'Private capex joining in will bring strength in India's growth numbers that weare forecasting to go to 7.5% in March FY19.' He also expects the Reserve Bank of India to maintain itsneutral stance at its monetary policy review next month. – (Mint Nov 28, 2017 p 18)

"Elected autocrats can take nations down wrong path" – Former RBI governor Raghuram Rajan saidgovernments need to listen to a broader spectrum of people to reduce the possibility of mistakes, instead ofplanning their actions solely based on demands from their supporters. While Rajan said one needs to wait fordata to emerge to be able to assess the full impact of demonetisation, the economist from Chicago Boothadded that tax authorities could play a significant role in identifying evaders based on data at their disposal. Atthe same time, he cautioned against harassment. – (TI Nov 27, 2017 p 9)

"GDP growth likely to improve to 6.2% in A2: Ficci survey" – India's GDP growth rate is expected to riseto 6.2 percent in the second quarter of the current fiscal as the adverse impact of demonetisation and GSTappears to be bottoming out, according to Ficci's latest Economic Outlook Survey. – (BS Nov 28, 2017 p 4)

"Hope reforms will reflect in upgrade next year: Garg: S&P preferred to be cautious, says economicaffairs secy" – Keeping the sovereign rating and outlook for India unchanged, global ratings agency Standard& Poor's said, 'India's GDP growth rate is among the fastest of all investment-grade sovereigns, and weexpect real GDP to average 7.6% over 2017-2020 (6.5% in per capita terms)'. A report.– (TI Nov 25, 2017 p 18)

"India growth to rebound to 8% in FY19: Goldman" – India's economic growth will bounce back to 8% inthe next fiscal year as one-time hits due to demonetisation and goods and services tax wear off and benefitsdue to formalisation of the economy, strong global growth and recapitalisation of public sector banks kick in,US-based investment bank Goldman Sachs (GS) said in its year-end forecast. – (ET Nov 28, 2017 p 11)

"India now cyclically at the beginning of an upswing in credit growth: Jonathan Garner" – Editedexcerpts from an interview with Jonathan Garner, chief Asia and emerging markets equity strategist, MorganStanley. Driven primarily by domestic buying, India is at the start of an upswing in equity market activity andcredit growth, which could see corporate earnings grow in at least their high teen's year-on-year for the nexttwo years. – (Mint Nov 27, 2017 p 8)

"India's growth story strong in medium term: S&P's Bhatia" – Edited excerpts from an interview withRavi Bhatia, director, sovereign and international public finance ratings, Standard and Poor Ratings Services,defends S&P decision to keep India sovereign rating unchanged at BBB- with a stable outlook.– (Mint Nov 27, 2017 p 8)

– 2 –

"S&P refuses to upgrade India, retains BBB- rating: sees strong growth, sound external accountsposition" – Global rating agency Standard and Poor's refused to upgrade India's sovereign ratings, maintainingits BBB- rating with stable outlook. This is the lowest of all investment grade sovereigns that we rate, S&P'ssaid, while talking a favourable view of reforms undertaken by the government in the past year. includingfiscal consolidation. A report. – (HBL Nov 25, 2017 pp 1,4)

"S&P's India rating flawed, says PMEAC member" – Standard & Poor's (S&P) decision to keep India'ssovereign rating unchanged at the lowest investment grade of 'BBB-' last week partly on grounds of thecountry's low per capita income is flawed, according to Prime Minister's Economic Advisory Council memberSurjit Bhalla. Bhalla argued that a country's rating should be guided more by return on investments and riskperception, among others, rather than low per capita income. – (FE Nov 28, 2017 p 3)

"What are the factors that can accelerate growth in India?" – Edited excerpts from discussion with UdayKotak, executive vice chairman and managing director of Kotak Mahindra Bank; N Chandrasekaran,Chairman of Tata Sons, Rajnish Kumar, Chairman of State Bank of India (SBI), Madhav Chavan, CEO ofPratham, and Dominic Barton, Managing Partner at McKinsey Global. Kotak said India's per capita GDPneeds to grow at 8% a year for the next 20 years to catch up with China's per capita GDP.– (Mint Nov 24, 2017 p 10)

"The worst may be over for the Indian economy" – India's economic growth is set to rebound afterdecelerating to 5.7% in the quarter ended June, the slowest pace in three years, as the disruptive effects ofthe withdrawal of high-value banknotes in November 2016 and the 1 July switch to the goods and servicestax (GST) fade. Gross domestic product (GDP) will grow 6.4% in the July-to-September quarter, accordingto the median estimate of 46 economists polled by Bloomberg. A report. – (Mint Nov 30, 2017 p 1)

Shah, Ajay – "Measuring the drama in the economy" – Seasonal adjustment is a powerful tool to obtainbetter and faster insights into the macroeconomy. An article. – (BS Nov 27, 20147 p 11)

FIFTEENTH FINANCE COMMISSION"N K Singh appointed Chairman of 15th Finance Commission: Panel to study impact of GST, review

fiscal consolidation" – Former Expenditure and Revenue Secretary N K Singh will chair the FifteenthFinance Commission. Former Economic Affairs Secretary Shaktikanta Das and adjunct professor ofGeorgetown University Anoop Singh will be its full- time members. Chairman of Bandhan Bank Ashok Lahiriand NITI-Aayog member Ramesh Chand will be part-time members. IAS officer Arvind Mehta will be theSecretary to the Commission. The Union Cabinet had on November 22 approved the setting up of theFifteenth Finance Commission. The panel, which is a statutory body under Article 280(1) of the Constitution,will prescribe the formula for devolution of taxes between the Centre and States for the five years commencingon April 1, 2020. It is expected to submit its report by October 30, 2019. – (HBL Nov 28, 2017 p 4)

Padmanabhan, Anil – "15th Finance Commission: A challenge and an opportunity" – An article.– (Mint Nov 27, 2017 p 17)

FOREIGN EXCHANGE RESERVES"Forex reserves rose to $ 399.533 billion as on November 17" – India's forex reserves rose by $ 240.40

million as on November 17 to $ 399.533 billion, data from the RBI shows. Foreign currency assets, whichform a key component of reserves, rose by $ 220.40 million from the previous week to $ 375.096 billion. Goldreserves remained stable at $ 20.66 billion. Special drawing rights from the IMF rose by $ 7.9 million from theprevious week to $ 1,497 billion. – (FE Nov 25, 2017 p 10)

GST"GST on fuel: states' nod key: move will happen over time, with States' cooperation: CEA" – Chief

Economic Advisor Arvind Subramanian said going forward, there would be fewer GST rate slabs and petroleumproducts are to be brought under the GST with the cooperation of the States. It will happen in the next fewmonths and years... and done cooperatively. A report. – (H Nov 25, 2017 p 13)

– 3 –

"We need to further simplify GST for small firms" – Edited excerpts from an interview with ArvindSubramanian, Chief Economic Adviser. – (BS Nov 29, 2017 pp 1, 10)

REFORMS"Time to consolidate reforms, says NITI Aayog's Rajiv Kumar: New initiatives will focus on health,

education sectors" – NITI Aayog Vice-Chairman Rajiv Kumar said the time has come for consolidation ofreforms, including GST, bankruptcy code and benami law, initiated by the Modi government in the last 42months to ensure that the steps deliver the 'desired fruits'. The new initiatives in the next 18 months, Kumarsaid, should focus on health and education sectors as these two are going to be critical for human resourcedevelopment. A report. – (HBL Nov 27, 2017 p 13)

REVENUE"Revenue shortfall: Centre may get lower than expected dividend from PSBs: Public lenders' profits

strained by rising NPAs and increased provisioning" – The government is expecting a shortfall incollections from estimated dividend from public sector banks, whose profits have been strained by rising non-performing assets and increased provisioning due to initiation of NPA resolution against many accounts,official sources said. The government has estimated to receive Rs.74,901.25 crore as dividend/surplus fromthe RBI, national banks and financial institutions. A report. – (IE Nov 29, 2017 p 14)

SERVICES SECTOR"Service sector: Key driver of India's economic growth" – The service sector has been able to contribute

as much as 53.8 per cent of gross value addition to India's economy in last one year. A report.– (ET Nov 30, 2017 p 6)

BANKING

ALLAHABAD BANK"Allahabad Bank cuts MCLR rates by 5 bps" – Allahabad Bank has cut its reference rate, MCLR, for

various tenors by 0.05 per cent, which will be effective from December 1. It said in a regulatory filing that theAsset Liability Management Committee (ALCO) of the bank has revised the existing Marginal Cost ofFunds based Lending Rate (MCLR) and decided to reduce it for all the tenors by 5 basis points (0.05 percent). Banks review MCLR, the rate below which they can't lend, every month. The new rates for overnightlending for 1-6 month and 1-3 years have been reduced by 0.05 per cent each in the range of 7.75-8.50 percent. – (FE Nov 30, 2017 p 10)

AXIS BANK"Axis launches international payment service" – Axis Bank has launched an instant international payment

services using Ripple's enterprise blockchain technology solution for retail and corporate customers. Thoughan international offer, the bank is offering the facility only to its retail customers in the country.– (FE Nov 25, 2017 p 10)

BANK OF BARODA– MSME FINANCE

"BoB to step up MSME focus" – Enthused by the Centre's schemes for the MSME segment and the GSTrollout, Bank of Baroda is planning to step up its focus on supply chain financing, whereby it will provide loansto MSMEs associated with large corporates based on the credit rating of the latter.– (HBL Nov 27, 2017 p 17)

– 4 –

BANK OF MAHARASHTRA– VEHICLE FINANCE

"Pradhan launches CNG-run bikes, BoM to finance 5k kits" – Dharmendra Pradhan, the Union Ministerfor Petroleum and Natural Gas, launched retro-fitted compressed natural gas (CNG) two-wheelers. Helaunched the vehicles at an event organised by the Maharashtra Natural Gas Limited (MNGL) at SavitribaiPhule Pune University. Setting an initial target of 5,000 such two-wheelers to hit the roads soon, Pradhan saidthe cost of retrofitting them will be borne by the Bank of Maharashtra (BoM). Each cylinder costs Rs.15,500over the cost of the vehicle. Of that, BoM will finance Rs.12,000 interest-free. A report.– (TI Nov 25, 2017 p 7)

CANARA BANK"Canara Bank rolls out apps, digital library" – Canara Bank celebrated its Founder's Day on November 19

by rolling out several initiatives and benefits for its staff. The initiatives launched include a digital library, aCanarites app, a field recovery mobile app, a retail loan (vehicle) - tracking system, and a regulatory guidancetracking system. – (HBL Nov 24, 2017 p 10)

– CONSOLIDATION

"Canara Bank employees against merger" – The employees of the Canara Bank requested the Centre notto consider cross merger of smaller public sector banks having high NPAs. Founder of Canara Bank StaffFederation S Revanna said, the merger would not bring any relief to the ailing banking industry as theincreasing NPAs pass the burden from one entity to another. – (FE Nov 25, 2017 p 10)

HDFC BANK"HDFC Bank hikes CSR spend by 47% in 2 years" – HDFC Bank has increased its corporate social

responsibility (CSR) spending by 47% in the past two years. The bank's spending on CSR has gone up fromRs.248 crore in FY16 to Rs.305 crore in FY17 and is expected to touch Rs.365 crore this fiscal. A report.– (TI Nov 25, 2017 p 18)

"HDFC Bank will achieve CSR target this fiscal: Deputy MD: rural development programme touches750 villages" – HDFC Bank's flagship CSR initiative Holistic Rural Development Programme has touched750 villages, with a tiny hamlet Umpathaw in Meghalaya becoming the 750th village under the programmethat aims to improve access to potable water and provide a smart school to village children. Through HRDP,the hamlet's 106 households have got potable water at their doorstep, the first time since independence, thelender said. A report. – (HBL Nov 25, 2017 p 6)

"Largest opportunity for growth is still in India: HDFC Bank Deputy MD" – Banking behemoth HDFCBank sees the 'largest opportunity' for its growth to still come out of India in the coming years and plans topersist with its 'omni-channel' strategy to plumb deep into the growing domestic market. 'Will we grow ourinternational business? The answer is yes. However, the largest opportunity for growth for us is going to beIndia-centric,' according to Paresh Sukthankar, Deputy Managing Director, HDFC Bank.– (HBL Nov 28, 2017 p 10)

"We may be in for a bit of a pause on rates: Factors driving down interest rates have reversed, saysHDFC Bank's Sukthankar" – Excerpts from an interview with Paresh Sukthankar, Deputy ManagingDirector, HDFC Bank. – (H Nov 27, 2017 p 13)

"With GST, more lending will be formalised now" – Edited excerpts from an interview with Arvind Kapil,Group Head of Unsecured Loans, Home & Mortgage Loans, HDFC Bank. – (ET Nov 29, 2017 p 14)

ICICI BANK"ICICI promotes women entrepreneurs: Kochhar" – ICICI Bank is steering several initiatives such as 'I

work at home' for women to promote entrepreneurship in the country, according to the bank's MD and CEOChanda Kochhar. She said that the organisation does not have specific policies for women but it creates anenvironment where women entrepreneurs can feel confident. We create a real working environment wherethey can work from home. A report. – (FE Nov 30, 2017 p 10)

– 5 –

– HOUSING FINANCE

"With RERA in place, real estate supplies will go down still further" – Edited excerpts from an interviewwith Ravi Narayanan, Senior General Manager and Head-Retail Secured Assets, ICICI Bank. The home-loan slowdown induced by the implementation of the Real Estate (Regulation and Development) Act (RERA)will reverse in another six to eight months. Over 60% of new home launches in the industry in the first half ofFY18 had ticket sizes under Rs.25 lakh. – (FE Nov 28, 2017 p 10)

IDBI BANK"IDBI Bank to sell 1.5% stake in NSE in bid to exit non-core business" – State-owned lender IDBI

Bank Ltd said it plans to sell a 1.5% stake in the leading bourse National Stock Exchange (NSE). This is apart of exercise to exit from non-core business. The board of IDBI Bank at its meeting held on Mondaygranted in-principle approval to divest 74,15,680 equity shares, amounting to 1.5% stake, of the NSE held bythe bank, it said in a filing to stock exchanges. – (Mint Nov 28, 2017 p 7)

KARNATAKA BANK"Karnataka Bank, BCG tie up for transformation initiatives: Seven major areas identified for

intervention" – Karnataka Bank has partnered with Boston Consulting Group (India) for its transformationinitiatives. The transformation project - KBLVikaas - was launched in Mangaluru. The project, according toa press release, is aimed at total transformation of the bank by repositioning it as a 'relevant and significantbank' by focusing on technology and keeping intact its core values and identity. – (HBL Nov 30, 2017 p 6)

LAKSHMI VILAS BANK"Lakshmi Vilas Bank extends decline with 6.6% fall: Analyst attribute fall to investors" – Lakshmi

Vilas Bank extended losses to the second day, declining over 6.6% to Rs.168 after the lender fixed rightsissue price at Rs.122 per share. The rights share price was at 32% discount to Friday's closing price ofRs.179.95 for the stock. A report. – (ET Nov 28, 2017 p 12)

PUNJAB NATIONAL BANK"PNB to offload 6% stake in PNB Housing Finance for Rs.1,324 crore" – Public sector Punjab National

Bank looks to raise over Rs.1,324.21 crore by diluting 6 per cent holding in subsidiary firm PNB HousingFinance in an offer for sale (OFS) that starts. The floor price of the OFS is Rs.1,325 per share. Earlier thismonth, PNB Managing Director and Chief Executive Officer Sunil Mehta said the bank has a headroom tosell up to 9 percent stake in the subsidiary. – (Mint Nov 28, 2017 p 7)

RBL BANK (RATNAKAR BANK)"RBL Bank increases stake in Swadhaar FinServe to 60%" – Private sector lender RBL Bank has

increased its stake in microlender Swadhaar Finserve to 60.48% for an undisclosed sum and now possessrights to increase it to 100%. – (Mint Nov 28, 2017 p 7)

"RBL Bank uses SunTech platform to become GST ready" – SunTec Business Solutions has helped RBLBank achieve GST compliance by integrating its Xelerate platform into the bank's existing technology landscape.Designed to be an over-the-top solution, Xelerate boasts pre-configured rules which allow itself to be nimblyconfigured irrespective of inter and intra-state combinations. A report. – (HBL Nov 25, 2017 p 6)

SOUTH INDIAN BANK"South Indian Bank raises Rs.490 cr via private placement" – South Indian Bank has announced the

successful fund raising of Rs.490 crore by way of private placement of Basel-III compliant Tier-2 bonds.Besides augmenting Tier-2 capital, this exercise would further strengthen the capital adequacy ratio or thecapital to risk-weighted assets ratio (CRAR) position of the bank to support the targeted business growth.– (HBL Nov 30, 2017 p 6)

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STATE BANK OF INDIA"SBI launches card for COEP stundents, staff" – SBI has introduced a company branded card for COEP

students, faculty and staff. Along with the banking transactions done by a debit card, the card will also serveas the identity card for people in COEP. the digital card will facilitate numerous transactions and operationslike issuing books in the college library, entry in the hostel and cashless payments, among others, at thecollege and hostel campus by COEPians. – (IE Nov 25, 2017 PN p 3)

"SBI launches YONO, an integrated app for financial services" – State Bank of India has launched aunified integrated app called YONO (You Need Only One) that would offer all kinds of financial and lifestyleproducts. A report. – (HBL Nov 24, 2017 p 10)

"SBI looking to sector like renewables and roads to boost loan growth: Kumar" – SBI is exploring theways to expand loan growth to sectors such as railways, roads and renewable energy, which are attractinghigher public spending, chairman Rajnish Kumar said. India's largest lender is also looking at investmentopportunities in financial technology, or fintech, start-ups, Kumar said. A report. – (Mint Nov 25, 2017 p 24)

"SBI plea in NCLT against Bhushan arm" – Following the admission of loss-making Bhushan Steel underthe Insolvency and Bankruptcy Code (IBC) earlier this year, State Bank of India (SBI) has now referred thecompany's subsidiary Bhushan Energy - an unlisted entity - to the National Company Law Tribunal (NCLT).A report. – (FE Nov 25, 2017 pp 1, 2)

"SBI raises interest rates on bulk deposits by 1 percentage point" – State Bank of India (SBI) raisedinterest rates on bulk deposits by 1 percentage point in certain categories, effective Thursday. India's largestlender increased interest rates by 1 percentage point across all maturities for bulk deposits greater than Rs.1crore. It left rates for deposits below Rs.1 crore unchanged - these were last reduced by 25 basis points on1 November. One basis point is one-hundredth of a percentage point. – (Mint Nov 30, 2017 p 6)

"SBI's YONO app promotional sets the right tone: The catchline, 'Lifestyle & Banking, Dono',resonates with customers" – 'Lifestyle & Banking, Dono'. The catchline in the promotional video perfectlycaptures the essence of YONO (You Only Need One), the new, unified integrated app from State Bank ofIndia (SBI). The video was screened from New Delhi where Finance Minister Arun Jaitley and SBI ChairmanRajnish Kumar jointly launched the app at a colourful function. A report. – (HBL Nov 28, 2017 p 10)

"State Bank to reduce headcount" – SBI chairman Rajnish Kumar said the lender is likely to end FY18 witha smaller workforce that what it began the year with. When you have such a vast and diverse client base asSBI, the need for human interface will always be there. But, if you ask me, it (employee count) was 2,78,000at the beginning of this year, will it remain 2,78,000? it is unlikely Kumar added. Some cost efficiencies haveto definitely come in as a result of whatever we are doing on the technology and digital front.– (FE Nov 24, 2017 p 1)

"We are constantly upgrading, eager to tie up with new age companies: Rajnish Kumar Chairman,SBI" – Rajnish Kumar who took the reins of SBI in October, spoke about the bank's future growth strategyand key challenges confronting the sector. Edited excerpts from an interview – (HT Nov 25, 2017 p 13)

– HOUSING FINANCE

"Implementation of RERA to improve retail credit demand" – Edited excerpts from an interview with PK Gupta, Managing Director, State Bank of India. Once all states implement the Real Estate (Regulation andDevelopment) Act, home loans growth should improve. He also said that the bank's Yono app, launched lastweek, has already seen close to 200,000 downloads. – (FE Nov 30, 2017 p 10)

YES BANK"YES Bank board okays plan to raise $1-b debt" – Private sector lender YES Bank said its board has

approved a proposal to set up MTN programme to raise $1 billion (about Rs.6,500 crore) on private placementbasis. The Medium Term Note (MTN) programme, an instrument to raise money through debt securities thattypically matures in 5-10 years, is within the overall borrowing limit of Rs.20,000 crore.– (HBL Nov 30, 2017 p 4)

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ASIA-PACIFIC REGION– LEVERAGE

"Asia-Pac banks riddled with high private sector leverage: Moody's" – Global rating agency Moody'shas said many banks in the Asia Pacific (Apac) region, including India, are exposed to high levels of privatesector leverage, although the buildup of such debt has slowed down of late. Indian and Chinese banks are themost exposed to high corporate leverage risks, followed by those in Indonesia, Vietnam, Korea and HongKong. The report blames the high leverage levels in the region to the unusually long period of low interestrates. A report. – (FE Nov 30, 2017 p 11)

UK"Focus on RBS in Bank of England stress test" – The Bank of England will publish stress test results for

seven of Britain's major banks on Tuesday, which will put the spotlight on Royal Bank of Scotland now thatthe government has revived plans to sell its majority stake. RBS failed the stress test a year ago and had tocut costs and sell assets worth $2.66 billion to plug a capital shortfall. RBS will be on the watch list, accordingto KPMG. A report. – (HBL Nov 25, 2017 p 6)

USA"Rise in fixed-rate loans poses risks to lenders" – US banks have scaled up the proportion of long-term,

fixed-rate lending they do in a move that generates higher interest income but puts them at greater risk ifthere is a sharp rise in rates, a leading industry regulator has said. Figures released this week by the FederalDeposit Insurance Corporation show that US banks are unable to change the terms on about $6.1tn worth ofloans and securities for at least three years. A report. – (FT Nov 23, 2017 p 12)

– FEDERAL RESERVE

"Fed on track to raise rates next month" – The Federal Reserve is preparing to raise its benchmark interestrate in December despite the concerns of some Fed officials about the persistent weakness of inflation,according to an account of the Fed's most recent policy meeting. A majority of Fed officials - including thechairwoman Janet Yellen have made clear that they are inclined to keep raising the Fed's benchmark rate. Areport. – (BS Nov 24, 2017 p 6)

"Once hawkish, Fed nominee Powell now champions Yellen's focus on jobs" – As a nominee to lead theFed, veteran governor Jerome Powell sides with the outgoing chair Janet Yellen in arguing that the Fed's easymoney policy has paid off by bringing millions back to work without any clear sign it has thrown markets offkilter. In remarks released ahead of his hearing by the Senate Banking Committee which is due on Tuesday,Powell said the Fed needed the capacity 'to respond decisively and with appropriate force' to new threats tothe economy. A report. – (FE Nov 29, 2017 p 16)

ASSET RECONSTRUCTION COMPANIES"RBI order may bump up ARCs' valuation: Asset reconstruction companies to get freedom to own

stressed firms" – The RBI's dispensation to allow ARCs to hold more than 26 per cent stake in distressedassets might bump up the valuations of the ARCs for foreign investors. The rule puts ARCs in a commandingposition in deciding how an asset resolution should happen. Latest rules give ARCs freedom to becomeowner of the stressed firm and drive the resolution process. The RBI objective would also make domesticallyincorporated ARCS attractive to foreign funds looking to acquire a share of the pie in India's Rs 10 lakh crorestressed assets markets. A report. – (BS Nov 25, 2017 p 2)

"RBI raises shareholding limit of ARCs" – The RBI has decided to allow asset reconstruction companiesto have higher holding than the 26 per cent cap set earlier with regard to limits on shareholding of the post-converted equity of a borrower company under reconstruction. – (HBL Nov 24, 2017 p 10)

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ATMs"Cash woes persist in rural India as ATMs disappear: Supply issues have forced shut-down of at

least 1,000 ATMs in remote areas" – A year after demonetisation, access to money in the country'sremotest parts still poses a great challenge. The latest RBI figures reveal that the number of ATMs in ruralareas has shrunk by a little over 1,000 in the past year - between the quarter ending September 2016 andSeptember 2017. India's rural areas were the worst hit during demonetisation, with the shortage of cash inATMs more acute in these areas. Industry players indicate that the RBI's remonetisation drive has notresolved the cash supply to ATMs in rural areas, forcing the shutdown of many ATMs. A report.– (HBL Nov 24, 2017 p 1)

BANK CAPITAL– BANKING REGULATORS

"Banking regulators edge closer to deal on capital rules" – The oversight body for global banking regulatorssaid it will meet on Dec. 7, in the clearest sign yet that a deal on completing post-financial crisis capital rulesis finally on the cards. France has been a key holdout for completing the Basel III rules, and people familiarwith the negotiations have said the oversight body would not meet unless a deal has been informally agreed.The oversight body, known as the Group of Governors and Heads of Supervision (GHOS), is chaired byMario Draghi, president of the European Central Bank. A report. – (ET Nov 25, 2017 p 6)

– PUBLIC SECTOR BANKS

"To raise Rs.1,35,000 cr: Govt to issue recap bonds in December" – The first tranche of recapitalisationbonds will be issued in December through a 'liquidity-neutral' model whereby public-sector banks (PSBs) selltheir shares to the government, which, in turn, issues long-duration bonds to the banks, according to an officialsource. A report. – (FE Nov 30, 2017 p 2)

BANK LENDING"Are you a credit risk? banks dig deep in your phone to find out: lenders are mining data on customers'

smartphones to help assess their risk for loans in a potentially huge market" – Indian banks havestarted mining data on customers' smartphone for fast loan approval, testing out cutting-edge but controversialtechnology in what is potentially a huge market for such products. A report. – (BS Nov 25, 2017 p 1)

"Non-food credit growth hits one-year high of 9%" – The no-food credit growth rate rose to a one-yearhigh of 9% y-o-y basis during the fortnight ended November 10. Growth in the preceding fortnight was 7.9%and it was 8.25% in the corresponding period of the previous year. The y-o-y jump in credit comes on a lowbase as banks had seen a dip in credit offtake in the corresponding period in 2016 after the announcement ofdemonetisation on Nov.8. According to provisional data released by the RBI outstanding loans to companiesand individuals rose to Rs 78.89 lakh crore from Rs 78.54 lakh crore a fortnight ago. Total bank credit rose8.65% y-o-y to Rs 73.24 lakh crore. A report. – (FE Nov 25, 2017 p 10)

BANKING REFORMS"Big bank reforms under consideration" – Major overhaul of human resource and risk management practices

in state-run lenders is under consideration as the government looks to further strengthen PSBs after Rs.2.11lakh crore capital infusion. A senior finance ministry official said that suggestions include lateral entry fromprivate sector in specialised verticals, setting up of a remuneration committee and making boards moreaccountable by separating their management and supervisory function. 'Some recommendations have alsobeen made by the Banks Board Bureau (BBB), we are examining them. The idea is to make these banksmore professionally managed and ensure that they are at par with the private sector,' said the above quotedfinance ministry official. A report. – (ET Nov 28, 2017 p 13)

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BANKING REGULATOR - RBI– COMMUNICATION

Nageswar, C Venkat and Ghosh, Soumya Kanti – "Central bank should communicate to curb marketirrationality" – An article. – (ET Nov 29, 2017 p 14)

BANKING TECHNOLOGY / INNOVATIONKinger, Deepak – "A virtual workforce in banks" – Cognitive robotics process automation and the use of

machine learning/artificial intelligence in banking processes is set to see an exponential rise. An article.– (FE Nov 27, 2017 p 8)

Majumdar, Romita – "An Alexa for banking & finance: Active.ai is offering personalised chat botservices to banking customers" – Imagine teaching how to transfer money online to a family memberwho isn't very comfortable with technology and possibly does not use e-wallets or online banking. What if allthey had to do was tell the banking app to transfer money to so and so person and it would be done?Active.ai's chat bot solution Triniti offers to help you with your needs, like a personal assistant but with thesecurity expected of a banking service. The bot gives you special offers on your birthday, reminds you aboutimpending payments, and even asks you if you need any financial assistance after studying your accounts.An article. – (BS Nov 27, 2017 p 15)

CHEQUES"No plan to withdraw cheque books: Finmin" – The finance ministry said there is no proposal to withdraw

the bank cheque book facility as part of exercise to promote digital transaction. – (FE Nov 24, 2017 p 10)

CORPORATE DEBT RESTRUCTURING"Welcome second life for the indebted" – Go for serious debt restructuring not to NCLT. At any rate, there

is wonderful clarity of mind at many corporate headquarters staring at the prospect of being referred to theNational Company Law Tribunal (NCLT) for resolution under the Insolvency and Bankruptcy Code. Thereis renewed interest in the possibility of restructuring debt, of a kind that was not evinced when banks hadmultiple such schemes, before the prospect of liquidation for not repaying loans had turned into harsh reality.This interest in serious debt restructuring is most welcome. An editorial. – (ET Nov 29, 2017 p 12)

CORPORATE DEFAULTSKhanna, Sundeep – "Corporate defaults are a consequence of poor management" – An article.

– (Mint Nov 29, 2017 p 6)

DEPOSITS"Bank deposits worth Rs.15 crore post note-ban declared 'benami'" – Cash deposits of Rs.15.93 crore

made in a Delhi bank post demonetisation have been held as property by a special court even as the depositorand the beneficial owner of the stash are 'untraceable'. The deposits were declared 'benami' in the ruling inone of the first adjudication cases of the new anti-black money law. – (HBL Nov 27, 2017 p 13)

DIGITAL CURRENCIES"Cryptocurrencies don't belong in central banks" – Should central banks embrace cryptocurrencies, or

even pioneer their own? In a nutshell, no. Crypto assets are an unusual innovation, still in flux and often poorlyunderstood. Trying to centralize them in a bureaucracy is exactly the wrong way to go. Yet China centralbank claims it is working toward a blockchain-based digital currency. Singapore has already experimented inthis direction. – (ET Nov 25, 2017 p 6)

– 10 –

"Here's what the central banks really think about Bitcoin" – Eight years since the birth of bitcoin, centralbanks around the world are increasingly recognizing the potential upsides and downsides of digital currencies.The guardians of the global economy have two sets of issues to address. First is what to do, if anything, aboutthe emergence and growth of the private cryptocurrencies that are grabbing more and more attention - withbitcoin now surging toward $10,000. The second question is whether to issue official versions. Following is anoverview of how the world's largest central banks (and some smaller ones) are approaching the subject. Areport. – (ET Nov 28, 2017 p 11)

Vishwanathan, Vivina – "The basic nuts and bolts of bitcoin" – An article. – (Mint Nov 30, 2017 p 13)

DIGITAL PAYMENTS"Cash transactions, cheque use fall since note ban: RBI paper" – Paper noted that the average monthly

volumes and values in retail electronic payment systems and card payments at POS terminals were significantlyhigher during the demonetisation period than earlier and remained at the same level during the demonetisationand post-demonetisation period. A report. – (FE Nov 25, 2017 p 10)

DOORSTEP BANKING"Banking services at your doorstep: Senior and differently-abled can breathe easy now" – If you are

60 years and above and have been getting banking services, there reason for you to cheer. Recently, theReserve Bank of India (RBI) has mandated banks to offer special facilities to senior citizens and differently-abled persons. This should improve access to banking services to people in these two categories. A report.– (HBL Nov 27, 2017 p 7)

EMPLOYMENT– AUTOMATION / DIGITISATION

"Jobs DEBITED: Expect more bank jobs to go because of automation and the digital economypush" – In the past half-decade or so, there have been many warnings sounded of the consequences rapidadvancing and ready adoption of machine-learning, digitisation and mechanisation will have on jobs for humans.An editorial. – (FE Nov 25, 2017 p 8)

GLOBAL BANKS– BARCLAYS

"Barclays plans to send private bankers back to Asia market" – Barclays' private bank plans to getbankers back on the ground in Asia and the Middle East, less than two years after selling its regional wealthmanagement business. After a 2016 deal to sell its Asian private bank to Singapore's Overseas-ChineseBanking Corp (OCBC), Barclay's international private bank is already evaluating its options for returning toa market where savings total $5tn and wealth is growing faster than anywhere else in the world. A report.– (FT Nov 27, 2017 p 13)

– HSBC

"HSBC suffers global banking blow" – The Goldman Sachs veteran brought in to shake up HSBC investmentbanking business is leaving the lender only 18 months after he was hired to lead a significant growth push.Matthew Westerman, co-head of HSBC's global banking division, is stepping down with immediate effect,according to the bank. A report. – (FT Nov 24, 2017 p 11)

– SOCIETE GENERALE

"SocGen to cut 900 jobs in digital push" – Societe Generale will close 15 per cent of its branch network andshed up to 900 jobs in France by 2020 as the bank looks to cut costs and accelerate its move into digitalbanking. A report. – (FT Nov 28, 2017 p 12)

– 11 –

GLOBAL SYSTEMICALLY IMPORTANT BANKSMerwin, Radhika – "Too big to fall" – The Financial stability Board recently put out the 2017 list of global

systemically important banks (G-SIBs), identifying 30 such banks. The three Indian banks declared as domesticsystemically (D-SIBs) important banks by the RBI are relatively insignificant compared to the global giants.A graphical report. – (HBL Nov 24, 2017 p 9)

– ROYAL BANK OF CANADA

"RBC joins list of top 30 global banks" – Royal Bank of Canada has been added to the list of 30 globalsystemically important banks by the Financial Stability Board of international regulators, the first Canadianbank on the list. It replaces Group BPCE, owner of Natixis, in the latest annual review by the FSB.– (HBL Nov 25, 2017 p 6)

INSOLVENCY AND BANKRUPTCY CODE"Bankruptcies and revivals" – Keeping out wilful defaulters from buying back stressed assets is welcome.

But the new norms may could overburden insolvency professionals. An editorial. – (HBL Nov 27, 2017 p 14)

"Bankruptcy code creates a good sense of urgency in NPA resolution process" – Edited excerpts froman interview with Paresh Sukthankar, Deputy Managing Director, HDFC Bank. The government last weeknotified an ordinance to tighten the insolvency rules. He said that the amendments in the Insolvency andBankruptcy Code (IBC) will make it legally possible to keep promoters with bad record out of the process.He also said that while the entire NPA crisis will take some time to come off, there is some concern on theagricultural loan front because of behavioural factors after many state governments announced loan waiver.– (IE Nov 27, 2017 p 12)

"Bankruptcy ordinance may disqualify global PE funds" – The broad sweep of India's amended Insolvencyand Bankruptcy Code (IBC) may shut out several global private equity (PE) funds who have tied up at least$10 billion to invest in Indian non-performing assets, according to the legal experts. Global PE funds havesecured commitments to invest at least $10 bn in distressed assets. – (Mint Nov 30, 2017 p 8)

"Bankruptcy panel member Umarji criticises ordinance: He says it will hurt struggling small- andmid-sise firms and encourage predators" – A senior member of the committee on bankruptcy law andone of its architects has voiced his criticism of the Ordinance that bars ousted promoters of an insolventcompany from regaining control. The Ordinance is obsessed with large borrowers, can adversely affect thefortunes of struggling small and mid-sized companies looking for a second chance, and can make defaultingcompanies vulnerable to predators, according to Mr Umarji, who was a member of the government constitutedBankruptcy Law Reforms Committee. – (ET Nov 27, 2017 p 7)

"Banks face legal tangle" – A cloudy scene: What bankers and counsels say: *A lot of hope was built atbanks around benefits from prompt resolution under the IBC from the fourth quarter of FY18; * This couldget postponed to FY19; * Without waiting to see if legislative prohibition is needed, the ban was imposed; *This is populist and sounds politically right but lacks a rational economic basis. A report.– (BS Nov 27, 2017 p 8)

"Barring some from bidding wouldn't hinder proper valuation" – Edited excerpts from an interview withSeshagiri Rao, Joint Managing Director and Group Chief Financial Officer at JSW Steel. He explains howJSW came out of restructuring in 2004 on the current debate regarding restructuring and bidding for stressedentities and assets. – (BS Nov 27, 2017 p 8)

"Debarring promoters may not be in the best interest of lenders" – Edited excerpts from an interviewwith Sudhir Maheshwari, Founder and Managing Partner of Synergy Capital, and a former member of theAccelorMittal Group Management Board. He said it might not be in the best interest of lenders to bar theerstwhile promoters from bidding. – (BS Nov 27, 2017 p 8)

"Debt redress: Indian bankruptcies can go the American way" – India's fledgling bankruptcy regime isturning both karmic and American. Eat, pray, love; applaud the shift. The government tweaked the 2016insolvency law to disallow managements that have been 'wilful defaulters' from bidding for their own assets.An article. – (HBL Nov 24, 2017 p 9)

– 12 –

"Don't create entry barriers for promoters" – Allow them, with 100% cash upfront, conditions. An editorial.– (ET Nov 27, 2017 p 12)

"Don't shed tears for either banks or promoters" – Promoters ran firms into the ground, so had to beousted, and banks were happy to sweep the dirt under the carpet. An editorial. – (FE Nov 27, 2017 p 6)

"IBC ordinance may bar clean bidders too, say stakeholders: Amendment keeps out not only wilfuldefaulters but also other potential bidders" – Amendments to the Insolvency and Bankruptcy Code(IBC) aimed at preventing company founders suspected of wrongdoing from regaining control of their assetsmay shut the doors on clean bidders, too, stakeholders say. Pitfalls posed by the IBC ordinance: * In bigcorporate structures, it leaves open the possibility that a bidder could be a connected party through associatecompanies and voting rights; * The 300,000 suspected shell company directors barred by the ministry ofcorporate affairs (MCA) cannot bid for stressed assets; * The ordinance does not clarify how to tackle'ineligibility' of potential bidders if the ineligibility criteria is subjudice; * The ordinance prevents an entity frombidding if it has been barred from the securities market; it does not clarify whether this provision is subject toan interim order or a final order; * The 'overdue' amount needs clarity - whether it is for the entire loan or aninstalment that has fallen due. – (Mint Nov 28, 2017 p 5)

"IBC: Noose tightens around promoters: Lenders will soon be able to initiate insolvency actionagainst personal guarantors too" – The recent amendment to the Insolvency and Bankruptcy Code 2016has added huge pressure on promoters acting as personal guarantors to corporate debt. Aside from themuch-talked about amendment that prevents erring promoters from buying back their stressed assets, a lessconspicuous tweak has set the ball rolling for notifying insolvency rules for corporate guarantors. A keyamendment will help commence Part III of the Code, relating to individuals and partnership firms. This partwill be operationalised in phases. Plugging the loopholes: * Earlier, lenders had to approach the DRT fortackling guarantors, which was a very long-winding process; * The necessary amendment to the IBC willsynchronise the proceedings of both the corporate debtor and personal guarantor. – (HBL Nov 27, 2017 p 1)

"Only 'errant promoters' need fear Insolvency Code: Centre: Slams 'canard', says ordinance levelsthe field for applicants" – In defence of its recent insolvency ordinance, the government has asserted thatthe entire effort is aimed at 'disqualifying errant promoters' while providing for a level-playing field for allprospective resolution applicants, including the promoters. There is no merit in the contention in certainquarters that the ordinance is 'anti-promoter' and designed to keep away all promoters from participating inthe resolution process. Such a canard - that it is 'anti-promoter' - is being spread to perpetuate the interests ofa few entrenched promoters to regain control over their assets, which are undergoing insolvency. A report.– (HBL Nov 28, 2017 p 1)

"PE funds chase stressed assets to buy cheap" – Private equity players are getting ready to bid forstressed assets, which they expect to bag at attractive valuations after an ordinance amended the IBC. Theordinance has practically barred most promoters of the defaulting firms from bidding for their assets in thebankruptcy auction. PE players have raised distressed assets funds totalling over $4 billion in the past twoyears, sensing an opportunity in the rising number of bad assets in the banking system. A report.– (BS Nov 25, 2017 pp 1,6)

"People are going to think twice before not paying dues: Vakil" – Edited excerpts from a panel discussionwith former State Bank of India managing director P. Pradeep Kumar; Finsec Law Advisors founder SandeepParekh, EY partner Abizer Diwanji, AZB and Partners founding partner Bahram Vakil and Shardul AmarchandMangaldas and Co. partner Shardul Shroff shared their thoughts on the move. In an effort to strengthen theinsolvency resolution process, the government has issued an ordinance barring promoters from joining theprocess if the company loan has remained a non-performing asset for more than a year.– (Mint Nov 27, 2017 p 8)

"President clears stricter version of bankruptcy law" – President Ram Nath Kovind gave his assent to anordinance amending the Insolvency and Bankruptcy Code (IBC), barring errant promoters of defaultingcompanies from regaining control of their assets being sold under the bankruptcy process. While expertswelcomed the move as sending a strong signal against crony capitalism, some expressed concern that suchstringent criteria for potential investors could reduce the number of revival proposals that may come up.

– 13 –

Tightening norms: * Revised bankruptcy code blocks errant promoters from taking control of firm underrevival; * Wilful defaulters, guarantors to the debtor, those with poor creditworthiness and disqualified directorsalso barred; * Turnaround professionals authorized to set eligibility criteria for bidders; * Penalty of Rs.1 lakhto Rs.2 crore introduced for breach of provisions; * Lenders' panel has to clear viability of revival schemewith 75% vote. A report. – (Mint Nov 24, 2017 p 1)

"Several promoters to move SC against changes in code" – Promoters of first list of 12 large cos workingout legal plan to oppose the revised rules. A report. – (ET Nov 29, 2017 p 9)

"What do amendments to IBC mean to promoters?" – India amended the Insolvency and BankruptcyCode (IBC) 2016 through an ordinance that received the President's nod. An explainer.– (H Nov 27, 2017 p 14)

Barman, Arijit – "Insolvency ordinance: Importance of being earnest" – Last week's new insolvencyOrdinance, barring all wilful defaulters, or incumbent promoters with bad loans for a year or more, from theauction process to repurchase their asset if they fail to clear all overdues is great polemics. But emotionsaside, it may end up bankrupting the banks even more. An article. – (ET Nov 28, 2017 p 14)

Basu, Debashis – "Bankruptcy ordinance: Motivated criticisms?" – An article.– (BS Nov 27, 2017 p 11)

Chakravarty, Manas – "A blow against the Promoter Raj" – It's ironic that the Left, which has been themost vocal about the wholesale transfer of public funds from banks into the pockets of unscrupulous corporatepromoters, hasn't uttered a word about the decision to bar promoters of defaulting firms to bid for theircompanies in the bankruptcy courts. Because the IBC ordinance is very strict, making it extremely difficultfor promoters, shady or otherwise, to regain control of their companies after they goes into bankruptcy. As itis, promoters have been running around desperately trying to unload their assets, in an attempt to pacify theirbankers. The amendments to the Insolvency and Bankruptcy Code (IBC) fans the fires already lit underthem. An article. – (Mint Nov 28, 2017 p 6)

Kumar, Manoj – "New insolvency rules will reduce flexibility" – Insolvency resolution is a commercialprocess and lenders should be allowed to take informed decisions. Lenders should not be compelled to rejectresolution plans from promoters. An article. – (Mint Nov 27, 2017 p 14)

Manuj, Hemant – "Insolvency & bankruptcy code ordinance: Unreasonably untouchable" – An article.– (ET Nov 27, 2017 p 12)

Menon, Shailesh and Mazumdar, Rakhi – "Collateral damage" – A carefully-worded Ordinance, Section29A of IBC, intends to checkmate promoters planning to buy back their assets at a fraction of what theyowe. But who does it slay on the way? An article. – (ET Nov 30, 2017 p 14)

Parekh, Sandeep – "Control-Alt-Delete for promoters" – An unintended benefit of this step will be awider-held shareholding taking root in India rather than the promoter-driven model. An article.– (FE Nov 28, 2017 p 8)

Ramakrishnan, Sriram – "Is bankruptcy code the harbinger of real change?" – A few months ago, asenior tax consultant walked up to me at a function and started talking about the dramatic changes in thebehaviour of the Income Tax department. Now, everything has been streamlined and is online. No more visitsto tax department, no more intrusions, no more energy-sapping waits at tax offices. An article.– (ET Nov 28, 2017 p 4)

Sinha, Pooja and Gupta, Satyajit – "Why foreign businesses should care about IBC" – The Insolvencyand Bankruptcy Code (IBC), together with its implementing regulations, introduced in December 2016 is auniform, comprehensive code dealing with financial failure, debt restructurings and insolvencies. It representsa game-changing shift towards a creditor-friendly and timeline-driven regime with limited scope for judicialdiscretion. Foreign businesses should carefully evaluate all contractual or other business dealings in India toavoid or mitigate the risks of being subject to an IBC process, either as a debtor or as a creditor. An article.– (BS Nov 27, 2017 p 12)

– 14 –

Sundaresan, Somasekhar – "Shun rhetoric, appreciate IBC problem" – The IBC ordinance is anotherexample of attempting to write a law to solve a problem that is not properly defined at the threshold. Anarticle. – (BS Nov 29, 2017 p 8)

– CHINA DEVELOPMENT BANK

"CDB's Rcom move could help India's banks" – By making a bid to push Reliance Communications Ltd.into bankruptcy, China Development Bank (CDB) has done what Indian lenders were trying their best toavoid. But now that it's pulled the trigger, State Bank of India and other domestic creditors won't be terriblyunhappy. A report. – (HBL Nov 29, 2017 p 8)

"China's CDB files insolvency case against Rcom at NCLT: Debt-heavy telecom company oweslender close to $2 billion in syndicated loans" – China Development Bank has become the first lenderto file a case against debt-ridden Reliance Communications Ltd (RCom) under the Insolvency and BankruptcyCode, according to two people familiar with the matter. The bank filed the case before the Mumbai bench ofthe National Company Law Tribunal (NCLT) on 24 November. – (Mint Nov 28, 2017 p 1)

– INSOLVENCY RESOLUTION

"Banks look for credible buyers; no fall in value of assets: SBI chairman" – Banks have backed thegovernment's move to ban wilful defaulters and promoters, who have defaulted for over a year, from biddingfor firms which are going insolvent, saying that resolution has to be very credible and credibility of those whoare bidding for assets would also need to be examined. We will be careful about a couple of things. The firstthing is that resolution has to be very credible because the idea is that if we can save the asset from liquidationand we should save it. Secondly, when we are talking about resolution, the credibility of those who are biddingwould also be examined, according to SBI chairman Rajnish Kumar. I don't mind some haircut but I don'twant to go bald, he added. A report. – (IE Nov 24, 2017 p 17)

"Debt resolution won't be easy for smaller Cos" – Debt resolution for smaller companies may becomemore challenging and the number of companies being liquidated could rise once the proposed changes to theIBC become law, resolution professionals dealing with smaller companies said. A report.– (ET Nov 24, 2017 p 15)

"Formulation of fair rules should not be driven by valuation alone: Sahoo" – The IBC ordinance barringthe promoters of defaulting firms will increase the probability of successful resolution, said IBBI chairman MS Sahoo. The amendments to the insolvency rules will keep firms that are already stressed from bidding asthey may not have the capacity to turn around another stressed firm Sahoo said in an interview over thephone. – (Mint Nov 25, 2017 p 24)

"IBC risks economic hazard: now places unprecedented restrictive thresholds; law firm" – Theamendments to the IBC, in attempting to ward off moral hazard, have created a potential economic hazard,according to AZB & Partners, a law firm. The code now explicitly prohibits certain persons from participatingin the resolution process, the law firm said in a statement. A report. – (H Nov 25, 2017 p 14)

"If you clear overdues, then you can take part in the insolvency process; K C Chakrabarty" – Editedexcerpts from an interview with Former Reserve Bank of India deputy governors K C Chakrabarty and S SMundra. – (Mint Nov 24, 2017 p 10)

"Insolvency ordinance may see 100-150 cases reopen" – The ordinance to make several companies aswell as some promoters ineligible to bid for ailing companies may result into reopening of 100-150 cases withinsolvency professionals beginning to dispatch letters to bidders to disclose if they are facing action in variousforums. A report. – (TI Nov 25, 2017 p 17)

"Keeping promoters out could hit bankruptcy process, say lawyers" – Barring promoters from biddingfor their own companies placed on the block in insolvency proceedings would dilute the competitive process,suppressing valuations, according to the lawyers and consultants. A report. – (TI Nov 25, 2017 p 17)

"New IBC provisions may deepen losses for banks" – Promoters of steel firms undergoing resolutionunder IBC were keen to bid for assets but will not be able to do so now after the amendments to the law,which may result in larger losses for banks, says a Kotak Securities report. A report.– (IE Nov 26, 2017 p 16)

– 15 –

"Promoters have put their lives into these companies" – As details of amendments to the IBC came tolight, Bhushan Steel's promoter Neeraj Singal, whose eligibility for submitting a resolution proposal is nowunder a cloud, in an interview tells why promoters should be allowed to bid and what the bidding criteriashould be. Edited excerpts. – (BS Nov 24, 2017 p 2)

"Resolution professionals seek extension of deadline to resolve insolvency cases" – Resolutionprofessionals are seeking an extension to the 270-day deadline to resolve insolvency cases after recent rulechanges tightened eligibility criteria for bidders of distressed assets. Resolution professionals to approachIBBI for leeway in bankruptcy law for genuine cases. A report. – (Mint Nov 30, 2017 p 8)

"Welcome move to tighten IBC norms" – Do more to boost competition for assets. An editorial.– (ET Nov 24, 2017 p 12)

Ghosh, Sugata – "Blunt, unforgiving, & political" – Foe New Delhi, promoters of failed companies are asuntrustworthy as those who bankrolled them. This is the message from the Ordinance that was moved toamend the IBC. An article. – (ET Nov 24, 2017 p 9)

Krishnan, Ravi – "Restrictions on bidders for bankrupt firms is good optics, but sub-optimal fix" –The government has got out of a tricky situation but the solution leaves a lot to be desired. The harshrestrictions on entities eligible to bid for companies under the Insolvency and Bankruptcy Code (IBC) is likecutting one's nose to spite the face. It could in all likelihood lead to fewer bids and of lower value as iteliminates a potential bidder by default. Lower bids means banks will have to sacrifice more of the moneythey are owed and take larger losses, and the burden gets shifted ultimately to the taxpayer. An article.– (Mint Nov 24, 2017 p 6)

– JOINT LENDERS FORUM

"Banks call lenders' meet over RCom" – Indian banks, which summoned an urgent joint lenders forum thisweek after China Development Bank moved the National Corporate Law Tribunal (NCLT) for insolvencyproceedings against Reliance Communications, will be forced to join the Chinese bank's petition if admitted,according to bankers. A report. – (BS Nov 29, 2017 p 3)

– NPA RESOLUTION

Arun, T K – "The public over promoter" – The resolution of bad loans via the Insolvency and BankruptcyCode presents the government with a choice: between the frying pan and the fire. There is a way out of thisfiery mess, but that calls for thinking and acting out of the box. Set up new bidders: NTPC and SAIL forpower and steel assets, special situation funds in EPF and NP|S, to raise the bid price now and make a killinglater. An article. – (ET Nov 29, 2017 p 12)

– SMEs

"Insolvency edict queers pitch for SME debt recast: Around 70% of such firms are facing liquidationfor lack of suitors" – The recent ordinance amending the Insolvency and Bankruptcy Code (IBC) has speltdoom for the restructuring of small and medium enterprises (SMEs). Around 70 per cent of companiesundergoing insolvency resolution face liquidation as their promoters are the only ones presenting resolutionplans. The ordinance virtually debars them from bidding for the stressed assets. Experts said at least 200 ofthe 300-odd SMEs would have to face liquidation. These companies have debts of Rs.1,50,000 crore. The 12big cases recommended by the RBI for insolvency resolution have debts of around Rs.2,50,000 crore. Areport. – (BS Nov 30, 2017 pp 1, 12)

– STEEL SECTOR

"New bankruptcy code provisions to deepen losses for banks: Kotak report" – Promoters of Steelcompanies undergoing resolution under the bankruptcy code were keen to bid for assets but will not be ableto do so now after the amendments to the law, which will result in larger losses for banks says a report. Thereport comes a day after government promulgated an Ordinance amending the IBC that bars promoters ofcompanies which have defaulted for over a year from bidding for the assets being sold by the banks toreclaim their dues. A report. – (FE Nov 25, 2017 p 10)

– 16 –

– VALUATION OF NPAs

"Lenders, bidders split on assets valuation: Banks want enterprise value; bidders say insolvencylaw provides for only liquidation value" – Lenders and prospective bidders are having a serious differenceof opinion on the valuation of toxic assets, to be auctioned under the modified insolvency law. While thelenders are insisting that resolution professionals get the enterprise valuation of these companies done toensure sale negotiations begin from a higher point, the bidders say such firms should be sold at a 'scrap' valuein accordance with the provisions of the Insolvency and Bankruptcy Code (IBC).– (BS Nov 27, 2017 pp 1, 8)

INSOLVENCY RESOLUTION– DEBT TRANSFER

"Debt transfer won't curb creditor rights" – In what could set a judicial precedent against errant borrowerstrying to game the system, the National Company Law Tribunal (NCLT) in a recent order has held thattransfer of debt by a related party to a non-related party cannot lead to dilution of voting rights of the financialcreditors while the insolvency resolution process is on. A report. – (ET Nov 30, 2017 p 15)

INTEREST RATESIyer, Aparna – "Interest rates are set to rise as liquidity tightens" – The net absorption of liquidity by the

Reserve Bank of India was about Rs.35,000 crore, down 65% from the Rs.1 trillion a month back and a farcry from the peak of Rs.8 trillion in January. No wonder market chatter that liquidity is finally inching close tobeing neutral is growing louder. An article. – (Mint Nov 28, 2017 p 4)

LOAN DEFAULT"Small rise in home loan default in 2 yrs" – Auto and home loans have seen a marginal increase in the ratio

of delinquent accounts- failure to make timely payment - over the last two years. However, gold loans andtwo-wheeler loans have witnessed a reduction in delinquencies. A report by credit information bureauTransUnion Cibil (TUCIBIL) has shown that the overall delinquency rates in retail have been stable whilevariation in delinquencies among different segments have come down. A report. – (TI Nov 25, 2017 p 17)

LOAN RESTRUCTURING"Lenders can use 'Provisional Ratings' to rejig stressed debt: RBI lets banks use 'secret' ratings

for stressed cos to see if they can be revived before moving NCLT" – The Reserve Bank of Indiahas allowed lenders to rely on 'provisional ratings' - which will not be disclosed to the market - for rejiggingloans to distressed companies before resorting to the insolvency mechanism. A report.– (ET Nov 28, 2017 p 1)

MERCHANT DISCOUNT RATE CHARGES– INDIAN RAILWAYS

"Rlys urges banks to waive or cut fee on digital transactions" – The Indian Railways has urged banks towaive or sharply reduce the charges on digital payments for train tickets. The national transporter haspromised banks more business if they scrap or minimise the charges, called merchant discount rate (MDR),and said the move will encourage digital payments and benefit the banks, travellers and also the railways.This will help the railways reduce the cost incurred on window bookings of rail tickets and travellers in turnwill get cheaper tickets. A report. – (ET Nov 30, 2017 p 11)

MICROFINANCE– SHRI KSHETRA DHARMASTHALA RURAL DEVELOPMENT PROJECT

Bandyopadhyay, Tamal – "How small loans can be made cheaper" – An article.– (Mint Nov 27, 2017 p 7)

– 17 –

MONETARY POLICY"Govt wants RBI rate cut before March" – Impatient for faster economic growth, India's government is

lobbying for a reduction in official interest rates in coming months as it expects inflation to stay close to a 4percent target, according to finance ministry officials. A report. – (BS Nov 29, 2017 p 4)

Pan, Indranil – "Staying with a pause" – An article. – (Mint Nov 29, 2017 p 18)

Varma, Sonal – "Monetary policy: Steady as she goes is the theme" – An article.– (Mint Nov 30, 2017 p 8)

– INTEREST RATES

Sabnavis, Madan – "Monetary policy: A pensioner's nightmare?" – Utmost care should be taken wheninterpreting the concept of real interest rates as it is a very narrow concept and obfuscates the cumulativeimpact, especially for those who are fully dependent on interest rates for income. While 8.6% of the population(senior citizens) may be small to guide policy decisions, as the balance could be gainers, when interest ratesare lowered, this class is affected sharply. An article. – (FE Nov 30, 2017 p 9)

MONETARY POLICY COMMITTEEBhalla, Surjit S – "Towards making RBI/MPC accountable" – An article. – (FE Nov 25, 2017 p 8)

MONETARY POLICY TRANSMISSIONGhosh, Soumya Kanti – "Policy transmission: Some fallacies" – An article. – (BS Nov 29, 2017 p 9)

NIBM"NIBM director given Dewang Mehta prize" – The Director, National Institute of Bank Management, Dr

K L Dhingra, has been conferred the 'Dewang Mehta National Education Award' for his contribution toeducation at a ceremony held recently. After joining NIBM, Dr Dhingra has been instrumental in introducinge-certificate courses in four areas as mandated by the Reserve Bank of India and starting Workshops onInsolvency & Bankruptcy Code, 2016 for timely resolution of NPAs. – (TI Nov 29, 2017 p 5)

NON-PERFORMING ASSETS"No loan waiver for capitalists, says FM" – The government asserted that it hasn't waived any loans of big

defaulters, scotching rumours that debts of capitalists are being written off by banks. In a blog, financeminister Arun Jaitley said the time has come to be apprised of facts in this regard and one must ask at whosedirective the loans, which have now turned non-performing assets, were offered between 2008 and 2014 bypublic-sector banks. A report. – (FE Nov 29, 2017 p 10)

PAYMENTS BANKS– FINO PAYMENTS BANK

"Fino Bank targets Rs.1,500 cr of gold loan portfolio" – Gold may have lost much of its sheen withinvestors in the past year, but not gold loans, a primary security for small and tiny enterprises for securingfunds. Fino Payments Bank, for instance, that launched its operations about four months back, is seeingmaximum traction in gold loans. The newly-minted payments bank has tied up with various banks to sourcegold loans as third-party products through its 410 branches, giving Fino a profitable proposition even at thestart. The payments bank has already sourced gold loans worth Rs.200 crore for around 30,000 customers,and is targeting a portfolio of Rs.1,500 crore by FY19. A report. – (ET Nov 25, 2017 p 6)

"Fino Paytech to raise Rs.200 cr: To support the growth of its payments bank, NBFC arm" – FinoPaytech - the holding company of Fino Payments Bank - is planning to raise Rs.200 crore from a clutch ofdomestic and foreign investors by the end of the financial year, according to Rishi Gupta, MD and CEO, FinoPayments Bank, in an interaction. – (H Nov 30, 2017 p 13)

– 18 –

– PAYTM PAYMENTS BANK

"Jaitley launches Paytm Payments Bank: The bank will not levy fee for online transactions; nominimum balance requirement" – India's financial services sector achieved a major milestone with theofficial launch of the country's truly mobile-first bank, 'Paytm Payments Bank'. This payments bank has nominimum balance requirement, and promises a 'zero fe' regime on all online transactions. A report.– (HBL Nov 29, 2017 p 10)

"Paytm looks to become world's largest digital bank" – Paytm Payments Bank aims to create the world'slargest digital bank with 500 million accounts, envisioning an online financial services provider of everythingfrom wealth management to credit cards and stock market trading. A report. – (Mint Nov 29, 2017 p 9)

"We managed Rs.1000 cr deposits in 3-month beta run" – Edited excerpts from an interview with VijayShekhar Sharma, Paytm founder. – (BS Nov 29, 2017 p 2)

PUBLIC SECTOR BANKS– NPAs / WRITE-OFFS

"PSBs may face Rs.40,000-cr loss due to bad loans: Write-offs by commercial banks reach Rs.65,800crore in first half of FY18" – Commercial banks wrote off about Rs.35,000 crore of bad loans in July-September, taking write-offs to Rs.65,800 crore in the first half of the financial year. Credit costs - theamount set aside for bad loans and stressed assets - for ageing non-performing assets (NPAs) and NationalCompany Law Tribunal cases would take provision coverage ratio to 58-60 per cent by the end of FY18,from 44.3 per cent at the end of March 2017, according to rating agency ICRA. A report.– (BS Nov 28, 2017 p 4)

REGULATORY CHANGESMehta, Sangita and Shukla, Saloni – "A new banking era beckons" – Lenders for long were working

overtime on how to hide bad loans. Now, with options dwindling, the entire industry is set to embrace newpractices like cash flow-based lending instead of assets where values could be inflated. An article.– (ET Nov 29, 2017 p 14)

SMALL FINANCE BANKSIyer, Aparna – "Demonetization and higher costs bleed small finance banks" – Microfinance institutions

(MFI), once euphoric about turning into small finance banks, have now realized that it didn't guaranteesmoother business. Instead, things seem to have gotten worse for them. Eight out of the 10 who got a licencehave begun operations now, the latest being AU Small Finance Bank in September this year. Three are listedand what better example than these to show how brutal the change has been. An article.– (Mint Nov 24, 2017 p 4)

– AU SMALL FINANCE BANK

"AU Small Finance Bank starts selling MF" – AU Small Finance Bank has entered into agreement with 11asset management companies (AMCs), both domestic and international, to distribute their mutual funds. Thebank is already cross-selling general insurance and health insurance products. Being a small finance bank,we have advantages of greater market presence in low and middle-income category, unserved/underservedgeographies compared to other banks which provides a strong distribution platform to the AMCs, accordingto its managing director and CEO, Sanjay Agarwal. – (FE Nov 29, 2017 p 10)

– SURYODAY SMALL FINANCE BANK

"Suryoday Bank to raise Rs.150-250 cr via rights issue" – Suryoday Small Finance Bank is looking toraise Rs.150-250 crore in the coming months from its existing shareholders through a rights issue. We willexplore one more round of fundraising through a rights issue, maybe in the beginning of next year, accordingto managing director R Baskar Babu. – (ET Nov 27, 2017 p 14)

– 19 –

RBI CIRCULARS"Auction of Government of India Dated Securities" – (RBI Circular RBI/2017-2018/102 Ref. No. IDMD/

1325/08.02.032/2017-18 dated 27.11.2017)

"Reporting of Transactions by agency banks to RBI" – (RBI Circular RBI/2017-2018/103DGBA.GBD.1472/31.02.007/2017-18 dated 30.11.2017)

AGRICULTURE & RURAL DEVELOPMENT

AGRICULTURAL MARKET REFORMS"We need to reform agri markets in true spirit, invite organized capita" – Edited excerpts from an

interview with Ramesh Chand, farm economist and NITI Aayog member. Apart from staging protests inDelhi, farmers must make themselves heard in state capitals as well to resolve issues outside the centralgovernment's control. He spoke of the urgency of agricultural market reforms to meet the target of doublingfarm incomes by 2022. – (Mint Nov 29, 2017 p 19)

INDUSTRY

BOND YIELDS"Bond yields showing 'irrational exuberance', says SBI report" – ... the bond yields are surprisingly

witnessing significant upward movement, which can only be defined as irrational exuberance and profit-booking, according to SBI research report. – (IE Nov 29, 2017 p 14)

LIC"Finmin confirms LIC's Rs.1.5L-crore railway ticket" – Life Insurance Corporation of India can now go

ahead with its proposed Rs.1.5 lakh crore funding of the Indian Railways, with a finance ministry clarificationeffectively nullifying the sector regulator's concerns and demand for sovereign guarantee for the investment.A report. – (ET Nov 27, 2017 p 1)

"LIC books Rs.13,500 crore trading profit in Apr-Sep: Figure marks a 23.8% rise over the Rs.10,900cr it earned a year ago" – Life Insurance Corp of India (LIC), the country's largest institutional investor,has booked a trading profit of at least Rs.13,500 crore from the sale of equity holdings in the first half of thecurrent financial year, as stocks scaled record highs. The figure marked a 23.8% increase over the Rs.10,900crore in trading profit that LIC earned in April-September 2016 through investment redemptions, according totwo people with direct knowledge of the insurer's investment earnings. A report. – (Mint Nov 27, 201 p 5)

NON-BANKING FINANCE COMPANIES– LENDING

"NBFCs look to small businesses to build loan book: lending to MSMEs to see compounded annualgrowth of 11% over the next two fiscal years: Crisil" – While banks took a cautious stand in lending tothe MSME segment due to the steep increase in NPAs, a Crisil study shows that NBFCs have been aggressivein lending to this segment, registering a four-fold increase in their MSME credit book over the past five years.A report. – (HBL Nov 25, 2017 p 6)

SEBI"Tyagi's new team ready for action at SEBI" – For the first time since Ajay Tyagi became its chairman

earlier this year, market regulator SEBI has seen a reshuffle of key portfolios at the Executive Director (ED)level. The changes have taken place over the last couple of months. Tyagi's team is a mix of bureaucrats orexperts in the field of income tax and banking. A report. – (HBL Nov 29, 2017 p 1)

– 20 –

SMALL SCALE INDUSTRY

ENTERPRENEURSHIP– WOMEN ENTREPRENEURS

"GES 2017: Empowering entrepreneurs: The world is watching out for the unfolding of the GlobalEntrepreneurship Summit, the GES, at Hyderabad, from today" – Globally, between 2014 and 2016,entrepreneurship activity among women increased by 10 percent. One study estimates that closing the genderentrepreneurship GAP worldwide could grow our global GDP by as much as 2 percent, according to IvankaTrump, Advisor the President of the United States. A consumer connect initiative. – (ET Nov 28, 2017 p 9)

MSMEs"Making India - A feature on MSMEs" – A report. – (HBL Nov 29, 2017 p 19)

"More incentives for MSMEs complying with GST norms" – The finance ministry is considering introducingmore incentives from MSMEs that comply with the requirements of the new GST regime, including accessto loans at discounted rates in an attempt to reward early adopters and encourage others to comply. A report.– (HT Nov 24, 2017 pp 1,4)

INTERNATIONAL ECONOMICS"Goldman, Barclays see 'as good as it gets' 4% global growth" – It's looking like boom time in the world

economy again. As more economists publish their 2018 outlooks, those from Goldman Sachs Group andBarclays are proving the most bullish in predicting global growth will reach 4 per cent next year. That wouldbe the strongest since 2011 and up from the 3.7 per cent that Goldman Sachs estimates for this year. A report.– (ET Nov 29, 2017 p 9)

"OECD sees world growth at 3.6% even as debt builds" – Global economic growth is set to peak at aneight-year high next year as uninspiring investment and increasingly dangerous debt levels limit room forfurther improvement, according to the OECD. The global economy is on course to grow 3.6 percent this yearbefore reaching 3.7 percent next year then ease back to 3.6 percent in 2019, the Organisation for EconomicCooperation and Development (OECD) said in its latest outlook. – (IE Nov 29, 2017 p 13)

EURO-ZONE"Jobs growth and orders at 17-year highs as eurozone enjoys 'boom'" – The eurozone's 'booming'

economy powered ahead in November with jobs growth and new manufacturing orders reaching 17-yearhighs as a stronger currency did little to dampen robust foreign demand for the region's exports. According tothe eurozone purchasing managers' index, compiled by IHS Markit, the region's businesses enjoyed their bestmonthly performance in six and half years. All main indicators of output, demand, employment and inflationwere at multiyear highs, pointing to an economy now firing on all cylinders. A report.– (FT Nov 24, 2017 p 1)

FUND MANAGEMENT"Global fund management" – A weekly report. – (FT Nov 27, 2017 Supl. pp 1-16)

– 21 –

LABOUR & PERSONNEL MANAGEMENT

EMPLOYEES PROVIDENT FUND"Separating equity debt will benefit EPFO subscribers: in case of early withdrawal, they will be able

to choose the instrument from which they wish to redeem" – The EPFO cleared a new accountingpolicy for its equity-linked investments. Under the policy, 15 per cent of the PF contributions parked inequities will be allotted as mutual fund units to all the subscribers. These units can be redeemed by thesubscribers when they exit or withdraw the accumulated money. Now, subscribers will know exactly howmuch of their money is in debt and how much in equity. Withdrawal norms remain the same and subscriberscan't redeem their money whenever they want. Subscribers can partially withdraw money if they needmoney for marriage, education, among other reasons. A report. – (BS Nov 25, 2017 p 3)

HUMAN RESOURCE MANAGEMENT"A time to transform" – Here are five emerging best practices for HR as we head into 2018. An editorial.

– (HBL Nov 30, 2017 p 15)

SKILLS– EMPLOYMENT

Chatterjee, Debashis – "Square pegs in round holes will hit skilling and employment initiatives" –Skilling courses should be demand-, not supply-driven, to curb educated unemployment. The objective ofskilling millions of youth should be split into specified numbers being skilled in diverse disciplines as per theiraptitude and industry demands. Again, clarity in plans and programmes can drive greater success. For example,the success of Pradhan Mantri Sahaj Bijli Har Ghar Yojana relies on thousands of electricians, besides otherjobs connected to power and supply. An article. – (FE Nov 27, 2017 p 12)

MANAGEMENT

CORPORATE SOCIAL RESPONSIBILITY"CSR funds used fully by over 60% of firms: Nasscom Foundation" – More than 60 per cent of the

companies surveyed by Nasscom Foundation said they had spent 100 per cent or more of their CSR (corporatesocial responsibility) funds in 2016-17, according to a report, Catalyzing Change, brought out by the foundationin partnership with Goodera. This includes 63.3 per cent MNCs and 68 per cent non-MNCs. A report.– (HBL Nov 30, 2017 p 3)

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