Average Salary Increase 10 Percent p.a.

Lending under government sponsored schemes is slow poison for PSU banks. But the way Mr. Chidambram ex- FM built pressure on PSU banks to lend for infrastructure projects and to high value corporates and high value projects, it proved to be a deep poison like Potassium cyanide. As of now at least ten lac crore of bank loans is stressed out of which hardly five thousand crores are in government schemes. 99% of NPA in banks are due to top 200 bad borrowers of each bank. It is hardly one percent of gross NPA of public banks which are due to lending under PMEGP or other schemes.

 

There may not be a scam bigger than scam which is in bank. But other scams may be proved , bank scam many not be proved because in these cases borrower, bankers, politicians, regulators , auditors, inspectors have similar interest to hide bad loans or write off loans or sacrifice huge amount of dues to settle bad loans through compromise. Public banks are made to exploit poor and serve rich , to exploit bank staff to serve looting bad borrowers in the name of credit growth.

To add fuel to fire , poor quality of bank officials who have been elevated to higher posts on the basis of flattery and bribery are adding new NPA every quarter and there is no control on them . There is large scale corruption in promotion processes which cause erosion in work culture. Government of India is worried for appointment of ED and CMD only. They are not aware that the culture of corruption is deep rooted and mere change of ED or CMD cannot help in reducing bad culture . Public banks do not have scarcity of good officers , but unfortunately good officers are usually rejected in promotions and hence good officers do not take part in promotion processes or think it better to opt for voluntary retirement from bank.

Further lacs of cases are pending for recovery of dues from bad borrowers in various courts because of undue delay and casual treatment to bank cases and due to deep rooted corrupt culture and nexus between advocates, judges and administrative officials in DRTs and district administration. There is scarcity of good officers in all offices. Vigilance officers , auditors and inspectors of various offices who are supposed to be protectors are themselves indulged in corrupt practices.

 

Last but not the least, trade union leaders who used to be protectors of bank and bank staff during seventies and eighties are now another side of same coin which is represented by management. Trade union leaders barring some exceptions are partners in dirty game of senior officers and they too are engaged in damaging public banks. Union Leaders too are now in the category of VIP  who apply and who use their powerful position and bargaining power for transfer of staff , promotion of staff and for acquittal of bad officers in departmental inquiries but not to protect banks from ill-motivated officers .

Average salary increment across sectors projected at 10.7 per cent this year-Times of India 28.04.2015

With an objective to understand key compensation and benefits trends across sectors in the Indian market, Deloitte on Monday released the fifth edition of Annual Compensation & Benefits Trends Survey India 2015. According to the survey, the average salary increment across sectors is projected at 10.7 per cent in FY 2016, which is 0.4 per cent points higher than the previous FY 2015 (10.3 per cent). The survey witnessed participation from 250 organizations across 18 industry sectors.

Commenting on the trends this year, Vishalli Dongrie, Senior Director, Deloitte in India, said, "The increase of 40 basis points (bps) in the projection over last year's actual figures is guided by a conservatively positive market sentiment. While the attrition rate for financial year 2014-15 is higher than the preceding financial year by 30bps, the hiring outlook for the current year looks promising."

Pharmaceuticals, Life Sciences and Healthcare industry continue to lead the pack with companies projecting average increments of 12.1 per cent for the current financial year, whereas Infrastructure and Real Estate is a close second with 12.0 per cent. Retail and Logistics industries continue to lag the other industries with conservative projections of 9.4 per cent and 9.8 percent respectively.
Across industries, the focus on performance linked or variable pay continues to rise with an average projected hike of 17.4 per cent. BFSI maintains its aggressive focus on variable pay with a projected average variable pay estimate of 20.1 per cent, whereas Logistics, Media & Advertising forecast conservative estimates on average variable pay projections of 15.6 per cent and 16.1 per cent each. The consumer business sector shows conservative projections towards increments along with an increased focus towards variable pay.



The report goes on to highlight that the highest projected increments across industries are at the Junior Management level at 11 per cent, followed by the Clerical Cadre at 10.8 per cent. However, the Middle, Senior and Top Management levels are expected to get lower than the average industry increment at 10.6 per cent, 10.5 per cent and 10.4 per cent, respectively. The highest projected increments for Top Management levels this year are in Pharma, Life sciences and Healthcare while the lowest are in retail sector.

Survey findings also suggest that the voluntary average attrition rate for the financial year 2014-15 at 16.5 per cent has been 30 bps higher than the preceding financial year at 16.2 per cent. ITeS and Hi-Tech continue to report the highest employee churn with average voluntary attrition rates of 21.9 per cent and 19.9 per cent respectively, whereas Energy and Natural resources (10.5 per cent) and Chemicals (10.7 per cent) report the lowest average attrition rates across industries in 2014-15. Across industries, the highest attrition rates are observed at clerical and junior management levels as compared to the other management cadres.

According to Deloitte, better pay, better career prospects and better work life balance are the most widely reported reasons for attrition along with other personal reasons such as health, marriage or pursuing higher education etc. Across industries, a performance driven variable plan, long term incentives and cash / non-cash recognitions or awards are the primary levers used for talent retention. To attract skilled talent from the market, organizations across industries use sign-on bonuses, attractive benefits offerings along with practices of partially guaranteeing or assuring variable pay for a brief- initial period from joining as primary tools for talent attraction.
http://timesofindia.indiatimes.com/business/india-business/Average-salary-increment-across-sectors-projected-at-10-7-per-cent-this-year/articleshow/47072257.cms

FinMin to meet PSU banks to review stalled projects-Rediff com

Concerned over rising bad loans in infrastructure sector, the Finance Ministry has called a meeting of heads of public sector banks tomorrow to chalk out a roadmap for clearing bottlenecks that hamper implementation of large projects.
Case by case review of some of the major infrastructure projects would be undertaken by the ministry in presence of senior officers of the ministries of power, steel, transport, shipping and the RBI, an official statement said.

The Department of Financial Services Secretary Hasmukh Adhia had said recently that "we will be doing segment wise analysis of stalled projects to understand what are the impediments and what kind of policy support is required to facilitate implementation of these large projects.

"Large sized stalled projects of infrastructure sector, including power, surface transport, steel, shipping, would come up for review in the meeting at Mumbai".
The meeting would help the department crystalize actions required by banks, the Finance Ministry and other central ministries as well as support required from the Reserve Bank, he had said.

One of the major reasons for rising non-performing assets (NPAs) for PSU banks is non-implementation of infrastructure projects for reasons like, fuel linkage, environment clearance and land acquisition issue.

The level of NPAs and the stressed projects of the public sector banks have been showing an upward trend in the last four quarters.

As per RBI data, Gross NPAs of the PSU banks have gone up to Rs 2,60,531 crore (Rs 2,605.31 billion) as on December, 2014.

Gross NPAs of public sector banks rose sharply to 5.33 per cent in September 2014 as compared to 4.72 per cent of total advances at the end of March 2014.

As per an estimate, the impact of cancellation of coal block allotments on PSU banks because of production stoppage at thermal power plants is Rs 96,484 crore (Rs 964.84 billion).

About 300 stalled projects a involving staggering investment of Rs 18.13 lakh crore are pending for resolution.

Some of the important infrastructure projects under the category include, Hinduja National Power Corporation entailing investment of Rs 5,545 crore or Rs 55.45 billion), Lanco Amarkantak Power Ltd (Rs 7,700 crore or Rs 77 billion)), Prayagraj Power Generation Company (Rs 10,780 crore or Rs 107.80 billion)), Jindal India Thermal Power (Rs 9,121 crore or Rs 91.21 billion), and Lanco Anpara Power Ltd (Rs 6,000 crore).
Some of the stalled projects in the shipping and port sector are Dighi Port (Rs 1,432 crore) and Bharti Shipyard (Rs 5,000 crore). In the steel sector, a project of Essar Steel entailing investment of Rs 22,587 crore is awaiting clearance. Besides, projects of Bhushan Steel - worth Rs 30,000 crore, VISA Steel - Rs 6,000 crore, and Jindal Stainless Ltd Rs 8,986 crore have also been stalled.

Top bankers seek forbearance extension by a year, RBI reluctant-Financial Express

RBI has rejected a proposal by bankers to extend the date of forbearance for provisions on restructured loans by another year, according to two bankers privy to the discussions held on Monday.

The Reserve Bank of India (RBI) has rejected a proposal by bankers to extend the date of forbearance for provisions on restructured loans by another year, according to two bankers privy to the discussions held on Monday.
The withdrawal of the regulatory forbearance on restructured advances could lead to a sharp increase in banks’ gross NPAs to 5.7% by March 2016 from 4.5% as of December 2014, domestic rating agency Icra had said in a report in February.
From April 1, RBI had removed the distinction separating restructured assets and non-performing assets (NPAs), mandating that banks will have to provide at 15%, on a par with substandard asset classification norms of RBI.
A March 11 report by Macquarie notes that banks used to get away with conservative provisioning by restructuring loans and only providing 5% on them, whereas provisioning requirements now on classifying a loan as NPL is 3-4x of restructured asset provisions. “As NPLs age, provisioning will further go up. So banks will progressively increase their coverage requirements on bad loans over the next few years,” the report added.

Executives from public and private sector banks, such as State Bank of India, Punjab National Bank, Bank of India, Axis Bank and ICICI Bank, as well as officials from the credit restructuring (CDR) cell and members of the Indian Banking Association (IBA) were part of the closed-door meeting held with RBI officials in Mumbai.

The primary purpose of the meeting was to iron out issues arising in the joint lenders’ forum (JLF) mechanism and to expedite decision making. However, bankers used the platform to set forth their request to the regulator.
IBA officials reportedly said the bankers’ views on restructured account provisioning will be sent separately to RBI. However, RBI officials during the meeting “informally conveyed” to the bankers the regulator will not consider an extension.

The regulator provided some relief to banks in late-March, clarifying that cases referred to either the CDR cell or a JLF for restructuring, regardless of whether it is considered or approved, would be exempted from the revised rule. Consequently, references made in Q4 FY15 to the CDR cell, in terms of value, almost equaled the cases referred in 9MFY15. The cell received references worth R21,100 crore in Q4FY15 compared with R23,000 crore in 9MFY15.

Bankers are now resorting to the “rectification” option offered under the JLF mechanism, which allows them to sidestep the “restructured” classification. RBI has also created new schemes such as 5:25 for infrastructure, power and steel accounts, which will also not attract the 15% provisioning.
Essar Steel, Bhushan Steel, Adani Power subsidiaries and Jaypee Infratech are some of the companies that have sought relief under the 5:25 mechanism, according to information available with FE. Alok Industries with an industry exposure of almost R20,000 crore and Monnet Ispat (R11,000 crore) have been bailed out with additional funds under the rectification option.

The NPA levels for public sector banks breached the 5% mark by the December 2014 quarter, while that of private setcor banks were at 2.1%. Public sector banks’ fresh NPA generation was impacted by higher slippages from restructured accounts, which stood around 25% of the new NPAs generated in Q3, said the Icra report.

CBI finds 8 firms to be victims of Leakgate-TOI 28.04.2015

NEW DELHI: In an apparent U-turn in its 'corporate espionage' probe, the CBI has now found that eight companies, initially thought to have colluded with those leaking documents from various ministries, were actually the victims.

Top sources told TOI that documents related to investments/projects of these companies were leaked from the ministries of finance and commerce. Earlier, the agency had claimed that these companies were "beneficiaries of the confidential documents" and had arrested Mumbai-based chartered accountant Khem Chand Gandhi, suspecting him to be the middleman.

The eight companies are DLF Limitless Ltd, HDFC Bank Ltd, Glenmark Pharmaceuticals Ltd, Indusind Bank, Novalead Pharmaceuticals, Kakardi British Realty, Modril India Pvt Ltd and Prime Living.

CBI is still investigating the role of several corporate houses in the scandal and now plans to examine executives of these companies.

After initially terming well-known chartered accountant Rajendra P Chitale and Reliance Industries Limited's vice-president (finance) K V Mohanan as "suspects" in the case, and even examining them for three consecutive days last month, the CBI is yet to find anything against them.

CBI sources had claimed that a module of chartered accountants, lawyers and ministry officials had leaked more than 200 important documents related to Foreign Investment Promotion Board clearances to private companies. Some of the crucial documents included clearances to the Jet-Etihad deal and Vodafone, which were first reported by TOI.

An officer associated with the probe said, "We are still examining a large number of documents which were recovered in the hard disks and offices of arrested persons."

HDFC and the other companies had strongly denied their association with any chartered accountant who leaked documents for them. An HDFC spokesperson had said after the CBI raids, "We have read with utter dismay the media reports and the allegations made therein. We are shocked at our name being mentioned in them. We categorically deny having known or heard of, let alone interacted with, the individual named in these news reports. Any suggestion that we may have indulged in any wrongdoing is completely baseless and untrue. We state that these allegations, apart from being baseless and untrue, are defamatory and an attempt to malign the reputation of HDFC Bank."

CBI has so far arrested six persons including an under secretary in the department of disinvestment and grievances Ashok Kumar Singh, assistant in FIPB section Ram Niwas, section officer in the department of economic affairs Lala Ram Sharma, another government official Daljeet Singh, chartered accountant Khemchand Gandhi and Paresh Chimanlal Buddhadev, a partner in Chitale and Associates.

CBI is probing leak of "first and second level of decision making in the finance ministry and commerce ministry", which were taken by secretaries and ministers.