Its all about RBI, RBI and RBI.

Reserve Bank of India(RBI), was established in April 1935 with a capital of 5 crores on the recommendations of the Hilton Young Commission. Later in 1949 it was nationalized under the general superintendence and direction entrusted to a 20 members central board of Directors. 
Structure of RBI

• Governor
• 4 Deputy Governors
• 1 Government official from the Ministry of Finance,
• 10 Nominated Directors by the Government, who will give important elements in the economic life of country and,
• 4 nominated directors by the Central Government who will represent 4 local Boards.

RBI has main four(4) headquarters are at Mumbai, Kolkata, Chennai and New Delhi.


Functions of Reserve Bank of India / RBI

• The RBI has the sole right to issue bank notes of all denominations.  The RBI also acts as agent to government in issuing coins and small value notes.
• It Acts as an banker to the government. It is an agent to the Central government and all state governments in India except that of Jammu and Kashmir. It is obliged to do government transactions and carry out their remittances and other banking operations.
• It also acts as an banker to Banks, where every Scheduled bank has to maintain a certain cash and other equivalent balances of its demand and time liabilities. Where in 1962, the amendment made that the banks has to maintain cash reserves and statutory reserves with RBI.
• RBI also acts as an controller of credit i.e., it has the power to influence the volume of credit created by banks in India for various reasons ex like to control the Inflation.

Other Powers of RBI:

• Every Bank has to get a licence from the RBI to do banking business within India. ( New bank licences)
• To open a new branch, every bank has to get permission from the RBI.
• Weekly return has to be sent to rbi by all scheduled bank in detail, showing the assets and liabilities.
• It has the right to inspect the records of commercial banks.
• It holds all the cash reserves of scheduled banks.
• RBI controls the credit operations of banks through qualitative and quantitative controls.
• The whole Indian banking system is controlled by holding the rights for licencing, calling for information and inspection.
• Re-discount facilities is provided to the banks acting as the last resort lender and encouraging it developing new initiatives by different banks.

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Overview of Banking Sector - September.

Here updates will be done constantly, on recent happenings in the banking sector especially in India. In this post you can see the recent major changes/ initiative by the RBI or other banks in the month of August and September 2011.  

Its just an overview of the Banking industry/sector current affairs.

• The RBI has come up with new guidelines (eligibility criteria) for the new banking license. Here is the New Eligibility Criteria for New Bank License.

• RBI has tightened the finance companies norms by increasing the capital requirement to 15% from 12%.

• NBFC's new rules under consideration. Where only NBFC's with assets worth of Rs.1000 crore should be regulated, even if they are doing business with their own funds.  This step will ensure that only players who are serious remain. 

• Top 10 Non-Banking Financial Companies(NBFC's)

• Company Name	Assets ( In crores) apprx
  Shriram TransFi	24,786
  M&M Financial	12,165
  Sundaramfin	11,479
  Cholamandalam	9,017
  Shriram City	8,539
  Bajaj Finance	8,066
  SREI infra	7,842
  Manappuram Finance	7,577
  Magma Fincorp	5,130
  First Leasing	1,297

• RBI said to end the Pre-Payment
(paying the loan amount before the maturity) penalty charges on floating rate loans,(home or car loan).  The bank charge as high as 3% on outstanding loan amount as charges. As this will discourage the loan seeker to end up the loan debt burden, bank has taken this step. Already banks like Axis has initiated this move.

• The Major Micro Finance companies, Spandana Spoorthy Fianacial Services and Share MicroFin and Ashmitha Microfin plan to merger their businesses, thus creating a largest lender for small entrepreneurs. As of now only SKS  Microfinance is the only listed major player.

• The increasing inflation has forced the RBI Governer, Subba Rao to make another increase in the interest rates by 25basic points(0.25%) which cumulative a 12th increase in the last 18months which is about an increase of 3.25%. 

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BANKING SECTOR CURRENT AFFAIRS: APRIL - MAY 2011

BANKING SECTOR CURRENT AFFAIRS: JUNE - JULY 2011

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New Bank License Eligibility rules by RBI.

As the Reserve Bank of India has opened the new players to enter the banking sector, has given a hope for many private major players to enter the booming sector where the scope is very high for growth and huge potential as most of rural market is still untapped.


The draft guidelines are being issued with regular modification with cautions and conditions for the purpose of laying a strong rules and regulations. 


Few Eligibility criteria as per the new guidelines are.,

• Minimum paid up capital of Rs.500 crores,
• Should get listed within 2 years of time,
• Should setup at least 25% of their branches in rural unbanked areas (especially tier-III) 
• Be owned by a separate holding company that cannot borrow money to float the bank.
• Foreign holding in the bank has to be less than 49%,
• Operating company has to get its share in the company to 20% within 10years from start.

Finance companies has a chance to convert themselves into bank and even promoter groups with good credential(10 years record will be considered) in running their business can setup banks.


The Major companies who are in the race for new bank licenses are.,

Tatas, Anil Dhirubhai Ambani Group(ADAG), Power Finance Corporation(PFC), Aditya Birla Group, Bajaj Group, Larsen & Toubro (L&T), LIC Housing, Industrial Finance Corporation of India(IFCI), Religare, Srei, Mahindra and Mahindra(M&M).

BANKING SECTOR CURRENT AFFAIRS: APRIL - MAY 2011

BANKING SECTOR CURRENT AFFAIRS: JUNE - JULY 2011
BANKING SECTOR CURRENT AFFAIRS: AUGUST - SEPTEMBER 2011

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Recent New Initiatives by Banks - 2011 [Current Updates]

Here is an constant update of Current affairs of Banking sector in the year 2011.

Here you could find an continuous updates  of different bank initiatives, achievements, innovations, landmarks created by the banks in India over an period of time which can help you in updating your current affairs knowledge on Banks and Banking sector. 


Previously a post was made, where you could find updates of the Banks current affairs in the Month April -May 2011. Click Here for it.

SBI completes its 50 lakhs Aadhaar Enrolments(UIDAI) in the country making it the largest Non-Government Registrar.  This is been used by SBI to reach out the unbanked villages as per Bank's Financial Inclusion Plan(FIP). [FYI: Pratip Chaudhuri is the Current Chairman of SBI, who has replaced OP Bhatt].


Co-Branding of Banks: SBI(State Bank of India) and BoM(Bank of Maharastra) Joins Hand, and launched a new co-branded credit card product suite, under the SBI-BoM name for the BoM customers. 


Bank of India has launched its new product "Door Step Banking".

Canara Bank, launched its mobile banking product called "CANMobile".
Greater Bank annouced E-Lobby Services 24x7, a stategy of Innovation and Technology focus and achivement of ISO 9001:2008 certification.


Indian Overseas Bank(IOB), Oriental Bank of Commerce(OBC), Punjab National Bank(PNB), and Bank of Baroda(BoB) is awarded RBI Rajbhasha Awards.


Union Bank Wins ACI Excellence Award 2011 for their project Customer empowerment, and Canara Bank bags Export Excellence Award for outstanding contribution made to the export growth in Karnataka.

Previous Month: BANKING SECTOR CURRENT AFFAIRS: APRIL - MAY 2011

Next Month BANKING SECTOR CURRENT AFFAIRS: AUGUST - SEPTEMBER 2011

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Current Affairs on Banking Sector - 2011

Hope this information will be helpful to update your knowledge in Current affairs of Banking sector in the month April-May 2011. The high inflation has further made the RBI to keep changing the interest rates.


As the banking sector is one of the booming and having a great scope for business sector.  As the fresh new licences for the new player has not been given the old player are trying to capture by penetrating the market and retaining the customers with possible aggressive marketing and customer relationship management(CRM).  As the new player entering having a huge financial support and more importantly the reputation in other industries they currently into (Tata, Reliance Group, etc).


Here are the few recent news of banks, their achievement in recent past, new associations, Awards and Recognition, Growth and figures, and more importantly what new they can offer their customers. List of Indian Banks are



Next Month News: 
BANKING SECTOR CURRENT AFFAIRS: JUNE - JULY 2011


BANKING SECTOR CURRENT AFFAIRS: AUGUST - SEPTEMBER 2011


A Month wise updates in the Indian banking system is updates here. This is for the month of April - May 2011. Below you could find for the coming month direction.

• Indian Bank Introduces complaint through SMS facility.
• -To strengthen its customer grievance redressal mechanism its has introduced this facility.
• Punjab National Bank wins 6th BML Munjal (Brijmohan Lall) Award for 2010.
• - Awarded for excellence in learning and knowledge development in private sector category. Earlier the recipient of this award were.

Year	Private Sector	Public Sector
2006	Jet Airways	NTPC
2007	Infosys and Satyam	SAIL
2008	Mindtree Consulting	NHPC
2009	HSBC	Indian Oil Ltd.
2010	Tata Steel	ONGC
2011	Punjab National Bank	Tata Power

• United Bank of India opens its New Regional Office at Bangalore.(31st regional office).
• IndusIndBank get into an agreement with Finacle(which provides Core Banking Transformation Solutions and which is a part of Infosys Limited).
• Union Bank launches new facility in handling the New Pension Scheme(NPS) of Pension Fund Regulatory & Development Authority(PFRDA) through its branches.
• Allahabad Bank enters into 147th year (147th foundation day) and launches new services like Mobile Banking service, 100 ATM's, Mobile Van fitted with ATM. 
• Indian Overseas Bank(IOB) celebrated its 75th Anniversary.
• Vijaya Bank, Bank of Baroda, and State Bank of India(SBI) posted its financial results( where all three posted profits, where Vijaya Bank touched 1.22Lakh crore business and SBI posted 33% increase in its Net profit).
• Corporation Bank, Abhyudaya Bank, Dhanalakshmi and South India Bank are in spree of increasing its branches as soon as possible.
• Dena Bank takes the Swabhiman Card program(Financial inclusion program of Central government).

Update:
Indian Bank has received the Government of India approval to raise an additional equity capital of Rs.61.40 crore through Follow on Public Offer(FPO)(comprising 6.14crore equity share of Rs.10each) where the premium is not yet decided.

IDBI Bank and Indian Army signs a Memorandum of Understanding(MoU) for Banking services where the banks offers a wide range of banking services and products and customized salary accounts for the army personnel.

Bank-CSR Activities:
SBI Bank donated Rs.18.50lakhs rupees cheque to The Leprosy Mission trust India(TLM) for the reconstructuve surgery of clawed hands and legs of the affected leprosy patients.

United Bank of India opened Arsenic treatment plant in Gaighata Block, West Bengal.  The plant will provide arsenic free safe drinking water to around 3000 families in the locality.  

Next Update Available Here: 


Current Affairs in the Month - April 2012
BANKING SECTOR CURRENT AFFAIRS: JUNE - JULY 2011


BANKING SECTOR CURRENT AFFAIRS: AUGUST - SEPTEMBER 2011

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