Moneycontrol PRO

Dinesh Unnikrishnan

Deputy Editor

Moneycontrol

RBI determined to make banks lend to crisis-ridden mutual funds: Will lenders pay heed?

BUSINESS

RBI determined to make banks lend to crisis-ridden mutual funds: Will lenders pay heed?

Banks fear huge bad loans going ahead from such exposure in low-rated papers where mutual funds have parked money. Someone needs to guarantee these loans, ideally the government or the central bank.

Sapre says Franklin Templeton needs to repay lenders first before investors, in talks with firms for early repayment

BUSINESS

Sapre says Franklin Templeton needs to repay lenders first before investors, in talks with firms for early repayment

President of Franklin Templeton India assures investors that they will get their money back, but after the company pays off borrowings and sells securities.

Franklin Templeton gives moratorium to NCDs of three Future Group companies

BUSINESS

Franklin Templeton gives moratorium to NCDs of three Future Group companies

“Future Group has requested Fixed Income schemes managed by Franklin Templeton Mutual Fund , relief under the moratorium benefit announced by the RBI," the mutual fund said.

SIDBI extends loan repayment term to 1-year for NBFCs, MFIs

BUSINESS

SIDBI extends loan repayment term to 1-year for NBFCs, MFIs

This is a significant development as microlenders felt the earlier repayment rules were stringent considering the present operating environment.

COVID-19-hit microlenders knock on SEBI’s door seeking extension of rating period

BUSINESS

COVID-19-hit microlenders knock on SEBI’s door seeking extension of rating period

Rating agencies typically revise ratings of microlenders after 12 months. Despite the lock down, some of the microlenders have received communication from agencies on further rating revision.

All good for Axis Bank in Q4, but COVID-19 uncertainty shadows future outlook

BUSINESS

All good for Axis Bank in Q4, but COVID-19 uncertainty shadows future outlook

For banking analysts, Q4 numbers aren’t that important. All eyes are on the April-June quarter when the world will emerge out of the 40-day-long lockdown. That is when the RBI relief for borrowers, in the form of moratorium and liquidity stimulus, will come to an end.

Why banks are not lending to small companies despite availability of cheap funds from RBI

BUSINESS

Why banks are not lending to small companies despite availability of cheap funds from RBI

Their risk aversion has affected NBFCs and smaller MFIs the most.

Franklin Templeton: Who is to blame for the mess?

BUSINESS

Franklin Templeton: Who is to blame for the mess?

How lazy regulators, feckless rating agencies and rash fund managers take mutual fund investors for a ride time and again.

Coronavirus relief: MFIs write to Sidbi, RBI seeking relaxation in refinance scheme eligibility terms

BUSINESS

Coronavirus relief: MFIs write to Sidbi, RBI seeking relaxation in refinance scheme eligibility terms

On April 17, announcing the second round of COVID-19 relief measures, RBI Governor Shaktikanta Das had launched refinancing support to the tune of Rs 50,000 crore through all India financial institutions such as NABARD, SIDBI and NHB.

Shaktikanta Das is the knight in shining armour yet again; this time for worried mutual funds

BUSINESS

Shaktikanta Das is the knight in shining armour yet again; this time for worried mutual funds

This isn’t the first time the RBI is helping mutual funds industry. In 2008, in the aftermath of the global financial crisis, the RBI had stepped in to save the sector. The central bank then opened a special window to provide banks with funds to support mutual funds.

Franklin Templeton mess: A liquidity mishap or a series of wrong, aggressive bets?

BUSINESS

Franklin Templeton mess: A liquidity mishap or a series of wrong, aggressive bets?

The closure of Franklin Templeton’s six funds has opened room for questions.

Franklin Templeton fund closure: Will RBI step in to save MFs from likely redemption pressure?

BUSINESS

Franklin Templeton fund closure: Will RBI step in to save MFs from likely redemption pressure?

As investors look for safer assets, bank deposits — despite the lower returns they offer — may see more preference since safety will be sought-after over returns.

RBI's TLTRO 2.0 fails to get good response. What does it mean for fund-starved NBFCs?

BUSINESS

RBI's TLTRO 2.0 fails to get good response. What does it mean for fund-starved NBFCs?

"Limited participation by banks in the TLTRO 2.0 clearly highlights the bank's reluctance to lend to mid-size and small NBFCs and MFIs in the current situation," Brickwork Ratings said.

RBI's much-hyped refinance window may fail to help small MFIs and MSMEs

BUSINESS

RBI's much-hyped refinance window may fail to help small MFIs and MSMEs

"Due to the repayment clause and the minimum rating required, most MFIs are not even approaching SIDBI for refinance facility," said P Satish, Executive Director of Sadhan, an industry body.

RBI says 10% cap for banks to invest TLTRO funds applies only to the fourth tranche

BUSINESS

RBI says 10% cap for banks to invest TLTRO funds applies only to the fourth tranche

On 16 April, Moneycontrol had reported about the confusion in the markets on whether this rule applies to all rounds of TLTRO.

ICICI Bank confirms exposure to Singapore firm Hin Leong, says taking appropriate steps

BUSINESS

ICICI Bank confirms exposure to Singapore firm Hin Leong, says taking appropriate steps

On April 20, Moneycontrol reported that ICICI Bank has an exposure of $100 million (about Rs 760 crore) to Hin Leong.

RBI announces more measures to nudge banks to lend to small NBFCs. Will lenders act at least now?

BUSINESS

RBI announces more measures to nudge banks to lend to small NBFCs. Will lenders act at least now?

Smaller NBFCs and MFIs typically do not get preference since these companies are perceived to be high-risk borrowers and normally carry lower ratings.

Singapore’s Caladium ups stake in Bandhan Bank to 4.49%

BUSINESS

Singapore’s Caladium ups stake in Bandhan Bank to 4.49%

Of late, sovereign funds and other overseas investors are increasingly looking at Indian companies as share prices have fallen and these entities look good to global investors from an investment perspective.

Vijay Mallya saga: Endgame for ‘the King of Good Times’ but what next for his lenders?

BUSINESS

Vijay Mallya saga: Endgame for ‘the King of Good Times’ but what next for his lenders?

Mallya's holding in United Breweries is 11.04 percent which has a value Rs 2,696 crore and that of United Spirits (1.52 percent) at Rs 582 crore. In total, if banks manage to sell these share holdings on April 20, banks would get Rs 3,278 crore.​ But selling these shares and recovering money isn’t that easy.

ICICI Bank has $100 million exposure to troubled Singapore oil trader that hid losses

BUSINESS

ICICI Bank has $100 million exposure to troubled Singapore oil trader that hid losses

Singapore-based Hin Leong Trading (HLT) is in the dock for non-disclosure of hundreds of millions of dollars in losses over several years. HLT has sought a six-month moratorium on debts of $3.85 billion to 23 banks, including ICICI Bank.

RBI unhappy with banks being ‘selective’ and ‘cherry-picking’ instructions on NBFC loan moratorium issue

BUSINESS

RBI unhappy with banks being ‘selective’ and ‘cherry-picking’ instructions on NBFC loan moratorium issue

With no consensus in IBA meeting, the industry lobby is likely to move back to the RBI seeking clarity. But, the RBI’s view is that it never had any objection to banks giving moratorium facility to NBFCs and hence, further clarity on this issue isn’t required.

How SBI and a section of banks interpreted RBI’s silence to deny moratorium for fund-starved NBFCs

BUSINESS

How SBI and a section of banks interpreted RBI’s silence to deny moratorium for fund-starved NBFCs

In the backdrop of lack of clarity on the moratorium and banks' reluctance to invest in smaller companies, NBFCs may see their liquidity position weaken.

HDFC Bank Q4: Good show, but the COVID-19 shock is likely to weigh heavily beginning June quarter

BUSINESS

HDFC Bank Q4: Good show, but the COVID-19 shock is likely to weigh heavily beginning June quarter

With economic activity coming to a grinding halt and cash flows of companies getting impacted, analysts expect a rise in bad loans across the sectors. This could take a toll on HDFC Bank’s earnings too in the beginning first quarter.

RBI’s TLTRO 2.0 fund allocation may disappoint smaller MFIs, NBFCs yet again

BUSINESS

RBI’s TLTRO 2.0 fund allocation may disappoint smaller MFIs, NBFCs yet again

The smaller MFIs and NBFCs desperately need funds since their collections have stopped. Every month during the moratorium, these companies are losing 8-10 percent of the collections. The average loan tenure of their loans is 18-24 months.

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