BUSINESS
Chart of the Day: How GDP, inflation numbers responded to RBI rate actions over years
RBI has been struggling to find the right balance in terms of rate actions. Data suggests growth has taken a hit whenever RBI held rates high for too long
BUSINESS
A CRR cut is more probable this week than a rate cut
The RBI now has a ‘growth’ problem rather than an ‘inflation problem’. It cannot ignore the growth slowdown. At the same time, the MPC needs to time the rate cut carefully
BUSINESS
Chart of the Day | What RBI data tell us on trend in fake notes over last 5 years
The sharp jump in fake 500-rupee currency notes came in the year 2021-2022 when the number doubled to 79669 mpcs from 39453 mpcs in the previous fiscal year
BUSINESS
What the latest IBC data tell us on recovery rates
Recovery rate from IBC deals kept falling as delayed resolutions proved costly.
BUSINESS
A central banker's dilemma: To talk or nor not to talk!
Patra’s speech, in a way, reflected the ongoing dilemma within the RBI top brass on how to manage the communication part of the monetary policy at a time when the policymakers themselves aren’t sure of the point of a rate pivot
BUSINESS
Is RBI turning too conservative on credit risk amid growth worries?
Stifling credit growth in the name of risk management is akin to throwing the baby with the bathwater. Government has sent the right message.
BUSINESS
PSBs are doing fine on efficiency, but need to improve customer experience
PSBs have improved efficiency but often lack in providing good customer experience. A big reason is inadequate number of employees to manage the huge customer base.
BUSINESS
Chart of the Day | SBI's asset quality has improved despite a tricky loan market
SBI is often seen as a proxy of India’s banking sector and broader economy. Hence, the trends seen in SBI’s balance sheet are a reflection of the overall health of the economy
BUSINESS
Bank NPAs are down, but watch the SMA-2 loans closely
A look at the second quarter results of banks suggests that there has been a rise in the special mention category-2 loans (SMA) of some large banks. These can be tricky for the lenders if things don’t go according to plan.
BUSINESS
What do SBI’s July-September numbers tell us?
SBI numbers suggest an overall improvement in performance, rebalancing of loan growth from retail to corporate/SME and improvement in asset quality
BUSINESS
Moneycontrol Pro Interview | Keertana Finserv MD Padmaja Reddy points to a crisis brewing in microfinance
Reddy, who previously founded Spandana Sphoorty Financial Ltd warns that borrowers are severely over-leveraged, with more than 50 percent of borrowers having between 6 to 15 loans, with their EMIs far exceeding their household incomes
BUSINESS
What do cash usage data from the past 12 years tell us?
Indians are gradually letting go of cash for transactions, but cash is still king. The Cash Usage Indicator data shows a gradual decline in cash usage, but even then cash remains significant in the lives of Indians.
BUSINESS
Chart of the Day | Here’s how the major source of financing for Indian MSMEs changed, post pandemic
Covid presented one of the biggest challenges to small firms as funding from institutional sources dried up. However, the timely actions by the Government and the RBI by way of funding support and moratoriums on loan repayments helped these firms tide over the crisis.
BUSINESS
Unsecured loan books develop cracks. How big a worry is this for Indian lenders?
For years, banks and NBFCs were engaged in an intense rivalry to grow their loan books, perhaps forgetting the cardinal rule of lending—assessing a borrower's creditworthiness. Probably, they are having to pay a price for it now
BUSINESS
Chart of the Day | Indian banks are increasingly adopting AI in their daily operations
As per the RBI article, while both private and public-sector banks are increasingly emphasising on AI and related technologies, the pace of increase is higher for private banks
BUSINESS
October MPC minutes show there is a dove in the new batch of external members
Nagesh Kumar, the only MPC member who voted for a rate cut in the October policy, argued that a rate cut could help revive demand and help boost private investment. Kumar makes a convincing argument for a rate cut
BUSINESS
For RBI researchers, a durable alignment with inflation target is now in sight
Interest rate hikes have worked well to contain demand and inflation, says an article co-authored by deputy governor Patra in the RBI Bulletin. The RBI has hiked interest rates by 250 basis points since May 2022 to fight inflation
BUSINESS
RBI's proactive action on MFIs shows some firms failed to learn from the 2010 crisis
The RBI had given sufficient time to MFIs charging excessively high rates to revise their interest rates downwards. Some got the message; some didn’t.
BUSINESS
Chart of the Day | What do bankers think of loan demand going forward?
Bankers are bullish. This optimism could be due to the increased capex spending plans of corporations and start of a lower interest rate era that could spur consumer demand
BUSINESS
RBI’s confusing messaging on Big Tech, AI risks to banks is not helping
The RBI governor’s caution regarding the perils of excessive technology in banking isn’t new. We have heard this warning before. Does the regulator know something that we don’t?
BUSINESS
Don’t read too much into the Great Indian Rupee Melodrama
The rupee is swaying to global whims, not tanking. A gradual depreciation in the rupee's value could be part of the RBI's plan to neutralise excess capital inflows
BUSINESS
Shaktikanta Das’ warning on ‘growth at any cost’ is an eye opener for aggressive MFIs
Some NBFCs have been pushing credit to customers beyond their borrowing capacity by imposing stiff performance targets on employees
BUSINESS
Chart of the Day | A look at the link between vegetable prices and food inflation
Vegetable prices are a decisive factor in determining inflation trends at this point. There are early signs of food inflation easing but it is too early to say for sure. The MPC should be more worried about vegetable prices now than the Israel-Iran skirmish
BUSINESS
Will Iran-Israel war cause an agenda shift in the just rejigged MPC?
The MPC meet scheduled for October 7-9 will mostly likely set the ground for a rate cut two months later. The MPC is set to reverse its rate stance unless big surprises happen in the meantime
