Bank shares will be watched after the Reserve Bank of India (RBI) said after market hours on Tuesday, 20 August 2013, that the hardening of long term yields has resulted in banks incurring large mark-to-market (MTM) losses in their investment portfolio. Since these MTM losses are partly resulting from abnormal market conditions and could be expected to be largely recouped going forward, RBI said it has decided to provide some prudential adjustments for a limited period.
Current regulations require banks to bring down their statutory liquidity ratio (SLR) securities in held to maturity (HTM) category from 25% to 23% of their Net Demand and Time Liabilities (NDTL) in a progressive manner in a prescribed time frame. The requirement stood at 24.5% as at end June 2013. It has now been decided to relax this requirement by allowing banks to retain SLR holdings in HTM category at 24.5% until further instructions, RBI said.
Further, banks will now be allowed to transfer SLR securities to HTM category from available for sale (AFS) / held for trading (HFT) categories up to the limit of 24.5% as a one-time measure. Such transfer of securities from AFS/HFT category to HTM category should be made at the lower of the book value or market value. Banks have the option of valuing these securities for the purpose of such transfer as at the close of business of 15 July 2013, RBI added.
In addition, banks can spread over the net depreciation, if any, on account of MTM valuation of securities held under AFS/HFT categories over the remaining period of the current financial year in equal instalments.
Meanwhile, RBI said it would conduct open market purchase operations (OMOs) of long dated Government of India Securities of Rs 8000 crore on 23 August 2013, and thereafter calibrate them both in terms of quantum and frequency, as may be warranted by the evolving market conditions.
Tata Motors will hold its 68th annual general meeting (AGM) of shareholders today, 21 August 2013.
Also Read
Shares of Financial Technologies (India) will be watched after crisis-ridden National Spot Exchange (NSEL) on Tuesday, 20 August 2013, sacked its Managing Director and CEO Anjani Sinha and six other top executives on a day it failed to meet the first scheduled repayment to investors.
NSEL could settle only Rs 92.12 crore out of the scheduled of Rs 174.72 crore payment it had committed to the sector regulator Forward Markets Commission (FMC). This was largely because nine NSEL members failed to pay their dues.
The NSEL had to shut down its operation early this month following the government direction in the wake of violation of certain rules. It has given seven-month plan to settle Rs 5600 crore to investors.
Federal Bank will be watched after RBI barred investment by foreign institutional investors (FII) in the bank's shares as the FII holding in the stock reached the trigger limit of 49%.
The board of JBF Industries will meet today, 21 August 2013, to consider buy-back of equity shares.
Fortis Healthcare announced that its subsidiary, Fortis Healthcare International, has concluded the divestment of its entire holding in Fortis Hoan My Medical Corporation, VOF PE Holding2 and Swindon to Viva Holdings Vietnam (Pte) for an aggregate consideration of $80 million.
Apollo Tyres' proposed $2.5-billion acquisition of US-based Cooper Tire is reportedly facing unexpected opposition from 5,000 Chinese striking workers in the eastern Shandong province, where the American tyre maker has a joint venture with Chengshan group.
The National Stock Exchange (NSE) has decided to remove five stocks viz. Chambal Fertilizers & Chemicals, Gujarat State Petronet, Opto Circuits (India), Punj Lloyd and Shree Renuka Sugars from the futures and options (F&O) segment. Contracts for new expiry months in these five securities will not be issued on expiry of existing contract months, NSE said. However, the existing unexpired contracts of expiry months August 2013, September 2013 and October 2013 would continue to be available for trading till their respective expiry and new strikes would also be introduced in the existing contract months, NSE said.
Powered by Capital Market - Live News