Banks Like To Avoid Payment Of Dividend

3 PSU Banks Seek Exemption From Dividend Payment-NDTV-02.05.2015
New Delhi: Three public sector banks - Bank of India, Union Bank of India and Allahabad Bank - have sought exemption from payment of dividend citing higher provisioning for non-performing assets (NPAs).

"These banks want to improve capital adequacy by ploughing back the profits as they are not finding conducive conditions to raise capital from the market," the Finance Ministry said recently.

The three banks have requested for "exemption from payment of dividend" on account of a decrease in profit due to higher provisioning against bad loans (NPAs).
As per the Budget Estimates 2015-16, the projections from 'dividend and profit' from public sector companies and banks has been pegged at about Rs 1,00,651 crore. The revised estimate for the last fiscal year was Rs 88,781 crore.

In 2014-15, Union Bank of India had deferred its plan to raise Rs 1,386 crore fund through qualified institutional placement (QIP) to the current fiscal year.
There are 24 listed public sector banks.
The three banks will be announcing their annual results for 2014-15 in the coming days.
Union Bank of India had reported a 13.33 per cent decline in net profit at Rs 302.42 crore for the October-December quarter of 2014-15. The bank had a net profit of Rs 348.94 crore in the third quarter of fiscal year 2013-14.

Bank of India had posted a profit of Rs 173.38 crore during the period, down from Rs 585.82 crore in October-December quarter of 2013-14.
Allahabad Bank's profit during the period had almost halved to Rs 164 crore year-on-year.
Government has approved dilution of equity share holding of 52 per cent based on the credit growth, available capital, market valuation and performance of the bank.
The dilution of holding based on efficiency parameters is aimed at ensuring that credit needs of banks are taken care of.

Banking majors shake hands with start-ups for data intelligence-Hindu Business Line
By Rajesh Kurup/K Ram Kumar 

State Bank of India had to decide whether or not to extend loans to customers looking to invest in a housing project in Noida.

Though everything about the project looked good on paper, including the developer’s brand name, SBI decided against entertaining loans for it. Thanks to a partnership with online real estate start-up PropTiger, SBI got access to data that indicated that many customers who had already invested in this project were exiting due to delays and land issues.

 

Like SBI, banks are increasingly joining hands with online real estate portals to get market intelligence and buying trends. Crucial decisions such as going slow on taking exposure to housing projects in one city and stepping it up in another are increasingly being taken by banks based on information sourced from such online platforms.

Private sector lender ICICI Bank, for instance, is the preferred financial partner for three-year-old IndiaProperty.com, while three-year-old Housing.com has tie-ups with biggies such as Standard Chartered, HDFC and Axis Bank.

 

“Banks and private equity firms planning to take an exposure in real estate projects need a lot of data before lending at a project level or approving home loans to customers buying apartments in a particular project. We provide this data, which can be then sliced and diced,” said Dhruv Agarwala, Chief Executive Officer and Co-Founder of PropTiger.

Data analytics and ability to track user behaviour online is prompting the tie-up between banks and the start-ups. This includes data related to developer background, developer track record, information on new projects, demand-supply equation in a region and configuration and reigning prices, among others.

 

The monthly home loan uptake in the country is about ₹15,000 crore and analysts said partnerships with online players can increase uptake. The online sites get 3-5 million visitors a month and banks can convert these leads into business.

“We are great at technology, and banks are looking at tapping into customers who use online and mobile technologies for home buys. For banks, these tie-ups help them focus on their core competency,” said Advitiya Sharma, co-founder of Housing.com.

Project certification

In return, banks certify the projects listed on the website following a due diligence, giving them “trust and credibility”.

Banks to witness higher attrition this year: Experts-Business Standard 04.05.2015

The new banks are expanding their teams at a rapid pace and existing banks are grappling with talent retention

 

Banks are likely to witness up to 50 per cent increase in attrition this year compared to last year as new players entering the sector would prefer seasoned industry professionals to grow their operations, say experts.

The two new banking licences, that were given by RBI to infrastructure financing firm IDFC and micro-finance firm Bandhan Financial Services, are also expected to create job opportunities across the board in the banking space, they said.

The new banks are expanding their teams at a rapid pace and existing banks are grappling with talent retention. The existing players are looking to either rebuild their teams to pre-crisis levels or at expansion in their verticals to make the most of favourable economic sentiments.

"In fact, we expect 50 per cent higher attrition level compared to last year across all revenue-generating functions in banking," Michael Page India Regional Director Nicolas Dumoulin told PTI.

While, he said for support functions the attrition levels are likely to be higher by 25 per cent compared to last year.

GlobalHunt Managing Director Sunil Goel said, "Large pool of jobs is expected to be created wherein the maximum number of the jobs will include the bottom of the pyramid, but yes existing banking and financial professionals will get recruited by the new players so the attrition will get added another 15-20 per cent for current companies."

Though all the existing players will try to retain talent by giving large portfolio and decent compensation, but boom in the industry will bring the attrition higher than ongoing rate, he opined.

Dumoulin said that this trend has already picked up pace over the last six months as new entrants, foreign banks- both existing as well as new entrants, and global pension funds (setting up offices in India) are driving the current recruitments in the market adding to higher churn in the market.

Recently Qatar-based Doha Bank commenced operation in the country.

This attrition, Dumoulin said, will coincide with the appraisal cycle