Bank in your pocket: ICICI launches mobile based product-Money control
The new integrated mobile banking service is called 'Pockets', and ICICI Bank Managing Director and Chief Executive Chanda Kochhar claimed that this is the country's first digital bank on a mobile phone.
Having decided against applying for a payment bank licence as some of its rivals have done, ICICI Bank today launched a mobile phone-based product that offers a slew of new-age services.
Asked if this is the private lender's answer to the proposed payment banks, for which as many as 41 companies/ individuals, including SBI through RIL, have applied, Kochhar said, "why wait for payment banks to come into existence, here we are already offering the same".
'Pockets' integrates a digital wallet, a physical pre- paid card and a basic savings bank account, she said.
Syndicate Bank Q3 net declines 20% to Rs 305 cr-This bank has been considered as Efficient bank by RBI
Bengaluru, Feb 11:
Syndicate Bank reported a 20 per cent drop in net profit for the December quarter on lower net interest income and higher tax expenses.
The Manipal-headquartered public sector bank reported a net profit of ₹305 crore for the December quarter as against ₹379.76 crore in the corresponding year-ago quarter. Operating profit was 4 per cent higher at ₹838 crore (₹806 crore).
Net interest income, the difference between the interest earned and expended, stood at ₹1,317.68 crore (₹1,358.53 crore in the year-ago quarter).
Syndicate Bank to hire 5,000 people during FY16
Syndicate Bank will hire about 5,000 people in financial year 2015-16 to meet its growth plans. This will include 2,900 officers and 2100 clerical cadre staff, said T.K.Srivastava, Executive Director, Syndicate Bank.
"We have already placed an indent with the Institute of Banking and Personnel Selection to hire about 5,000 during next financial year," Srivastava said announcing the Bank's December quarter results. The Bank currently has about 29,000 employees managing a total of 3463 branches as of December, 2014. About 800 employees are expected to retire by end-March
Government to soon issue new guidelines to induct PSU bank directors -ET
NEW DELHI: The government may soon issue fresh guidelines for the selection of non-official directors of state-run banks, in keeping with its agenda to strengthen the boards of banks and make them more professional. The new guidelines encourage the appointment of experts from agriculture, risk management, financial inclusion and other such segments on bank boards. Such specialists must have experience of at least 10 years.
"The guidelines are with the Cabinet Committee on Appointments and may be finalised soon," said a government official aware of the deliberations. "The idea is that banks should have efficient boards which help them grow and optimise their efficiency."
"The guidelines are with the Cabinet Committee on Appointments and may be finalised soon," said a government official aware of the deliberations. "The idea is that banks should have efficient boards which help them grow and optimise their efficiency."
Indian bank's overseas branches grew 36% in 2003-14: RBI
MUMBAI: Indian bank's overseas branches saw robust growth overseas of 36.5 per cent in 2013-14, while foreign banks in India recovered from the slowdown with a growth of 20.6 per cent, RBI data showed today.
On the fee side, income generated by Indian bank branches overseas, however, moderated to Rs 8,960 crore (USD 1.5 billion).
"Total fee income generated by 188 branches of Indian banks operating outside India moderated to Rs 8,960 crore (USD 1.5 billion) in 2013-14 from Rs ..
On the fee side, income generated by Indian bank branches overseas, however, moderated to Rs 8,960 crore (USD 1.5 billion).
"Total fee income generated by 188 branches of Indian banks operating outside India moderated to Rs 8,960 crore (USD 1.5 billion) in 2013-14 from Rs ..
Union Bank, Bank of India unhappy over being left out of equity infusion-Business Standard
Over the last weekend, the govt announced its decision to infuse Rs 6,990 cr in nine efficient public sector banks
Peeved with the government’s decision to infuse equity in only nine banks, two Mumbai-based public sector lenders — Bank of India (BoI) and Union Bank of India — have conveyed their unhappiness to the Union finance ministry over being kept out of the list.
Over the past weekend, the government announced its decision to infuse Rs 6,990 crore in nine efficient public sector banks. It used two criteria — return on assets (RoA) and return on equity (RoE) — to decide which bank will be eligible get capital from the government.
The government had allocated Rs 11,000 crore for investment in equity of public sector banks in 2014-15.
The banks want transition time to improve performance on key parameters — RoA and RoE, as most of them are reeling under credit costs — the money set aside for non-performing assets (NPAs).
Confirming their dialogue with the finance ministry over the issue , a senior executive of Union Bank said, “The top management has held discussions with the finance ministry early this week.” He, however, refused to divulge details.
The official added it (the equity infusion) does not seem to be a well thought out action. “All banks should not be painted with the same brush.”
Another Mumbai-based lender, IDBI Bank, is internally discussing its strategy to present its case. Its net profit for the third quarter was flat at Rs 102 crore. Its capital adequacy ratio was 12.23 per cent with tier-I of 8.29 per cent.
“The intent to use efficiency norms to allocate capital is good. But the decision can’t be a knee-jerk action,” an IDBI executive said.
All three banks — Union Bank, BoI and IDBI Bank — are facing asset quality pressures due to an economic slowdown. They have substantial exposure to vulnerable sectors, including infrastructure, construction, and iron and steel.
Union Bank’s net profit for the third quarter fell by 13.2 per cent to Rs 302 crore from Rs 348 crore in the same quarter the previous year.
Its capital adequacy stood at 10.3 per cent with tier-I cities at 7.32 per cent.
Senior executives with all the three banks said there was no communication from the finance ministry to them.
“Bank chiefs only got to know from the press release. This is hardly a way to inform,” said one of them
A BoI executive said, “This stance could be explained beforehand so that banks can work out plans. Plus, the transition period (phased rollout) was necessary because the profitability is under pressure now.”
BoI is slated to announce its results for the third quarter on Thursday. Its capital adequacy ratio was 10.97 per cent with tier-I pegged at 7.97 per cent at the end of September 2014.
Over the past weekend, the government announced its decision to infuse Rs 6,990 crore in nine efficient public sector banks. It used two criteria — return on assets (RoA) and return on equity (RoE) — to decide which bank will be eligible get capital from the government.
The government had allocated Rs 11,000 crore for investment in equity of public sector banks in 2014-15.
The banks want transition time to improve performance on key parameters — RoA and RoE, as most of them are reeling under credit costs — the money set aside for non-performing assets (NPAs).
Confirming their dialogue with the finance ministry over the issue , a senior executive of Union Bank said, “The top management has held discussions with the finance ministry early this week.” He, however, refused to divulge details.
The official added it (the equity infusion) does not seem to be a well thought out action. “All banks should not be painted with the same brush.”
Another Mumbai-based lender, IDBI Bank, is internally discussing its strategy to present its case. Its net profit for the third quarter was flat at Rs 102 crore. Its capital adequacy ratio was 12.23 per cent with tier-I of 8.29 per cent.
“The intent to use efficiency norms to allocate capital is good. But the decision can’t be a knee-jerk action,” an IDBI executive said.
All three banks — Union Bank, BoI and IDBI Bank — are facing asset quality pressures due to an economic slowdown. They have substantial exposure to vulnerable sectors, including infrastructure, construction, and iron and steel.
Union Bank’s net profit for the third quarter fell by 13.2 per cent to Rs 302 crore from Rs 348 crore in the same quarter the previous year.
Its capital adequacy stood at 10.3 per cent with tier-I cities at 7.32 per cent.
Senior executives with all the three banks said there was no communication from the finance ministry to them.
“Bank chiefs only got to know from the press release. This is hardly a way to inform,” said one of them
A BoI executive said, “This stance could be explained beforehand so that banks can work out plans. Plus, the transition period (phased rollout) was necessary because the profitability is under pressure now.”
BoI is slated to announce its results for the third quarter on Thursday. Its capital adequacy ratio was 10.97 per cent with tier-I pegged at 7.97 per cent at the end of September 2014.
Weak governance, frail finances fail to dent Indian banks' global brand appeal
Domestic lenders improved their brand value by 61% in the past one year, according to Brand Finance.rankings
Mounting bad loans, reduced revenues and low capital adequacy have failed to spoil the global appeal of Indian banks. Local lenders have improved their brand value by 61% in the past one year despite their weak finances, according to a study by brand valuation consultancy Brand Finance.
India now ranks No 13 worldwide, four notches higher than the 17th rank a year ago, as domestic banks grew their brand value at the second fastest pace globally.
The study, Brand Finance Banking 500, showed that Indian banking brands' total value outranked that of Russia, Italy, Sweden and South Korea.
Not surprisingly, the findings have caught experts off-balance.
"I don't know the methodology used to calculate the brand value. In my understanding, for a bank to improve its brand position there should be a visible improvement in the customer service quality. I don't think that has changed drastically between last year and this year to justify a significant change in brand value," Shinjini Kumar, leader – banking and capital markets – at PwC in India, told Business Standard.
| GLOBAL RANK | ||
| BANK NAME | 2014 | 2105 |
State Bank of India
| 54 | 40 |
| ICICI Bank | 107 | 80 |
| HDFC Bank | 133 | 104 |
| Axis Bank | 178 | 131 |
| Bank of Baroda | 208 | 187 |
| Punjab National Bank | 227 | 197 |
| Bank of India | 275 | 199 |
Kotak Mahindra Bank
| 245 | 201 |
| IDBI Bank | 351 | 255 |
| Canara Bank | 301 | 262 |
Another banking analyst, who spoke on condition of anonymity, pointed out that governance was still a challenge for many public sector banks.
“It is one of the reasons why some of these banks are finding it difficult to raise capital from the market. Also, non-performing assets continue to haunt Indian banks. The recent earnings performance does not reflect that these problems are behind us," this analyst said.
“It is one of the reasons why some of these banks are finding it difficult to raise capital from the market. Also, non-performing assets continue to haunt Indian banks. The recent earnings performance does not reflect that these problems are behind us," this analyst said.
Criminal wrongdoing has also cast a shadow over the Indian banking industry, particularly public sector banks.
In August last year, the Central Bureau of Investigation (CBI) arrested Syndicate Bank's chairman and managing director Sudhir Kumar Jain for allegedly accepting a bribe from a private company to grant it credit extension despite repayment defaults on existing loans. The top post in the bank has been vacant since then.
But that seems to have made little difference to its brand value on the Brand Finance Banking 500 list– it has increased to $211 million in 2015 from $174 million a year ago. The state-run lender's global rank has also improved to 420 from 451 during this period.
The brand value ranking also seem to have given a wide berth to the weak financial performances of Bank of Baroda (BoB) and Punjab National Bank (PNB) in recent quarters. BoB reported a 68% drop in its third quarter net profit, while PNB's profit after tax growth in October-December period came in at a mere 2.5%. Notwithstanding, both banks have seen an increase in their brand value leading to an improvement in their global rankings.
Bank of Baroda now ranks 187th (compared to 208th in 2014), while PNB is at 197th position (compared to 227th a year ago).
| BRAND VALUE ($ MILLION) | ||
| BANK NAME | 2014 | 2105 |
| State Bank of India | 4,063 | 6,563 |
| ICICI Bank | 1,698 | 2,527 |
| HDFC Bank | 1,223 | 1,925 |
| Axis Bank | 766 | 1,331 |
| Bank of Baroda | 606 | 789 |
| Punjab National Bank | 511 | 748 |
| Bank of India | 397 | 724 |
| Kotak Mahindra Bank | 481 | 697 |
| IDBI Bank | 270 | 483 |
| Canara Bank | 339 | 456 |
Brand Finance, which calculates the brand value by determining the royalties a corporation would have to pay to license its brand if it did not own it (also known as the 'royalty relief' method), offered an explanation. The agency felt that economic reforms, increased infrastructure investment and a greater focus on tackling bureaucracy have boosted economic forecasts and investor confidence, laying the groundwork for India's brand to grow.
Technology has also played a part. "Technological advances are opening up exciting new opportunities for India's banks as swathes of the population begin to bank more formally. Their brand managers may need to forge new brand strategies to reach these customers most effectively while maintaining the trust and loyalty of existing ones," David Haigh, chief executive officer (CEO) of Brand Finance, said in a statement.
The country's largest lender State Bank of India (SBI) had 62 per cent increase in its brand value in 2015 compared to 2014. It added $2.5 billion to reach a total of $6.56 billion in brand value and remains India's most valued banking brand.
Brand Finance credits the bank's pioneering approach to mobile banking for the improved performance. It is estimated that 12.5 million customers used SBI’s mobile banking platform in 2014 compared to 8.57 million in 2013. Average transaction amounts also increased to over Rs 7,000 last year indicating that mobile is fast becoming a significant force in retail banking business.
A few industry experts share Brand Finance’s view but also credit the Reserve Bank of India (RBI) and its Governor Raghuram Rajan for the better-than-expected brand value of local banks.
“Indian banks' adoption and application of technology is unique. I think Indian banks' brand recognition globally has also improved because of the contributions made by the governor and RBI. The efforts made to stem inflation and reduce foreign exchange volatility have been appreciated and probably helped Indian banks to improve their brand value globally," Ashvin Parekh, managing partner at Ashvin Parekh Advisory Services, said.
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