Page 4 - Bank Loans

'No further interest on penal charges': RBI issues new guidelines for loans

RBI's new instructions on penal charges on loans shall come into effect from January 1, 2024

Banks' lending to NBFCs soars 35% to Rs 14.2 trn in June: Care ratings

Banks' lending to non-banking finance companies (NBFCs) rose by 35.1 per cent to Rs 14.2 lakh crore in June, a report said. Credit exposure of banks to NBFCs rose by a robust 35.1 per cent on-year to Rs 14.2 lakh crore in June, indicating non-banking finance firms' decreased reliance on international borrowings. This also pushed up NBFCs' share in overall credit from 8.5 per cent in June 2022 to 9.9 per cent in the reporting month, according to Sanjay Agarwal, a senior director with Care Ratings. However, the report noted that the merger of HDFC with HDFC Bank, effective July 1, will lead to a reduction in the share and also the exposure of banks to NBFCs, as HDFC's bank borrowings will undergo a temporary reclassification, resulting in a shift of exposure to HDFC Bank. Meanwhile, mutual funds' debt exposure to NBFCs, including through commercial papers (CPs) and corporate debt, also increased 14.5 per cent to Rs 1.62 lakh crore in June, it said. According to the report, MF exposur

Kerala to bear 50% interest on capital loans by cashew cos: Minister Rajeev

The Kerala government on Wednesday decided to bear a portion of the PF and ESI payments of the private cashew companies in an effort to revive the crisis-hit industry in the southern state. State Industries Minister P Rajeev while launching eight new value-added cashew products by the Kerala State Cashew Development Corporation (KSCDC) for the Onam market here, said the government has also decided to bear 50 per cent of the loan interest burden of these factories and has reached a settlement with the banks to write off all interest and compound interest on Non-Performing Assets of cashew factories. "Now the government has intervened with the banks, and the banks are now ready to write off the penal interest and the accumulated interest, and they are ready to settle these NPAs by settling 50 per cent of the amount of the loan up to Rs 2 crore and 60 per cent of the principal amount up to Rs 10 crore," Rajeev told PTI. He said the Kerala cashews produced by the KSCDC and Kerala State

'Bad bank' sees loan transfers dwindle on valuation, liability woes: Report

NARCL, which started in July 2021 to buy 2 trillion rupees in bad loans, has bought 213.5 billion rupees of such loans as of July 17, according to a government statement to parliament

RBI deputy Guv asks banks to double down on recovery efforts, limit losses

Reserve Bank Deputy Governor Swaminathan J on Thursday asked banks to double down on recovery efforts to limit the losses from the write-off of loans, saying it will help them post higher profits. The career commercial banker who recently joined the regulator also added that a bank's ability to recover or a borrower's liability to repay does not diminish with a loan write-off and recoveries can help a lender post higher profits. Earlier this week, the government informed Parliament that over Rs 14.56 lakh crore of advances were written-off by banks since FY15. "We would like the banks to redouble their efforts because these are accounts that are parked in a special account and we would like to see more and more recoveries," Swaminathan told reporters at the central bank headquarters here. Stating that there is a need to get the "context right" in this matter, he offered some nuances and stressed that there is a need to be "guarded" in "passing judgements". The DG said an NPA accou

UGRO Capital profit rises 245% in Q1 helped by robust loan disbursement

DataTech lending platform UGRO Capital on Wednesday said its profit after tax rose 245 per cent to Rs 25.2 crore in the April-June quarter, helped by robust loan disbursement. The non-banking finance company, which focuses on borrowers from the micro, small and medium enterprises (MSME) segment, had reported a Profit After Tax (PAT) of Rs 7.3 crore in the year-ago period. "The company's investment in distribution channel, large lender base and data driven underwriting model has stabilised monthly AUM increase of Rs 500-plus crore per month," UGRO Capital said in a release. The company's Asset Under Management (AUM) surged to Rs 6,777 crore as on June 2023, up 85 per cent from the year-ago period. The disbursement rose by 50 per cent to Rs 2,036 crore during the reporting quarter, which also improved the net income to Rs 125.6 crore. Its total income stood at Rs 218.3 crore in the first quarter of FY24, up 79 per cent year-on-year, while Gross Non-Performing Assets (GNPA) stood at

Top headlines: India ripe for semiconductor boom, banks' loans, and more

Business Standard brings you the top headlines at this hour

Govt instructed banks not to take harsh action against borrowers: FM

Union Finance Minister Nirmala Sitharaman on Monday said both public and private banks have been instructed that harsh steps should not be taken when it comes to the process of loan repayment and that they should handle such cases with sensitivity. Sitharaman said this while making an intervention during the Question Hour in the Lok Sabha on a question related to repayment of loans taken by small borrowers. "I have heard complaints about how mercilessly loan repayments have been followed up by some banks. The government has instructed all banks, both public and private, that harsh steps should not be taken when it comes to the process of loan repayment and they should approach the matter with humanity and sensitivity in mind," she said.

Sitharaman's Move: The End of Ruthless Loan Recovery?

RBL Q1 net profit up 43% to Rs 288 cr; aims to reduce unsecured loans share

Private sector lender RBL Bank on Saturday reported a 43 per cent jump in its June quarter net profit at Rs 288 crore, helped by core income growth. The city-based lender reported a 21 per cent jump in the core net interest income at Rs 1,246 crore on the back of a 21 per cent growth in advances and a 0.48 per cent expansion in net interest margin (NIM) to 4.84 per cent. The other income grew 12 per cent to Rs 685 crore. The bank is aiming to expand the NIMs further to 5 per cent going forward on the back of a better product mix, its managing director and chief executive R Subramaniakumar said. Its retail loans grew by 34 per cent, with newer products like mortgages experiencing the maximum growth. Subramaniakumar said the share of unsecured assets presently stands at 43 per cent, and the bank is targeting to decrease this by 2 percentage points by the end of the fiscal, as the share of secured retail finances, including home loans, two-wheeler loans and auto loans, grows. At the

Yes Bank's loan book grows 7.5% to Rs 2 trn in quarter ending June

It deposits grew 13.5 per cent YoY to Rs 2.19 trillion at end of June 2023

Bank of Maharashtra clocks credit growth of 25% at Rs 1.75 trn in June

State-owned Bank of Maharashtra (BoM) on Monday said it has posted a credit growth of 24.93 per cent at Rs 1.75 lakh crore in the June quarter. The outstanding credit was Rs 1.40 lakh crore at the end of June 30, 2022, BoM said in a regulatory filing. The Pune-headquartered lender registered a 24.82 per cent growth in total business (total advances and total deposits) to Rs 4.19 lakh crore at the end of June 2023 as against Rs 3.36 lakh crore at the end of the same quarter of previous fiscal. Total deposits of the bank increased by 24.73 per cent to Rs 2.44 lakh crore as against Rs 1.95 lakh crore at the end of the first quarter of the previous financial year. During the quarter, it said, the Current Account and Savings Account (CASA) ratio stood at 50.97 per cent of the total deposits. With regard to Credit Deposit (CD) ratio, it said, the number has increased to 71.86 per cent at the end of June 30, 2023 as against 71.75 per cent in the year-ago period. Gross investment of the

Pace of lending to infrastructure sector tumbles sharply to 1.8% in May

The share of power sector loans is around half of the bank's infrastructure loan portfolio of Rs 12.22 trillion as of May 2023

ED attaches Maharashtra-based steel company's assets worth over Rs 517 cr

The Enforcement Directorate (ED) on Wednesday said it has attached a Maharashtra-based steel company's assets worth more than Rs 517 crore under the anti-money laundering law in connection with an alleged bank loan fraud of over Rs 895 crore. The assets, including land, building and machinery, belong to SKS Ispat and Power Limited, the ED said in a statement. A provisional order for attaching these assets has been issued under the Prevention of Money Laundering Act (PMLA) and their total value is Rs 517.81 crore. The investigation pertains to a money laundering case based on a Central Bureau of Investigation (CBI) FIR against Tiruchirappalli-based boiler manufacturing company Cethar Limited that "availed" credit facilities of Rs 895.45 crore from a consortium of lenders led by the Indian Bank, SAM branch in Madurai. The ED said accounts of Cethar Limited turned NPA (non-performing asset) on December 31, 2012 and subsequently proceedings under the Insolvency and Bankruptcy Code (IBC

Credit card dues up 30% in Apr; cross Rs 2 trillion mark for the first time

The Reserve Bank of India (RBI) has expressed its concern about the growing unsecured bank credit

Manipur violence: What are RBI's riot relief measures invoked by the state?

The rules under these measures specify several norms that must be followed for restructuring the loans, providing fresh loans and other measures, including KYC norms

RBI to levy penalties on banks that lose property papers of loan seekers

Banks may have to compensate borrowers and also pay a penalty if they lose the original property documents of loan seekers

Thinking of prepaying your home loan? Things you should keep in mind

If home-owners have received a bonus, they may consider investing it in the capital markets instead of prepaying the loan

Bank loan fraud: ED attaches Rs 122 cr assets of Pune businessmen, others

Assets worth more than Rs 122 crore of various accused, including that of a former chairman of Pune-based Seva Vikas co-operative Bank and promoter of an education group, have been attached as part of money laundering investigation linked to an alleged bank loan fraud, the Enforcement Directorate (ED) said Friday. A provisional order for attaching 47 immovable properties worth Rs 121.81 crore located in Pune in Maharashtra and movable assets of Rs 54.25 lakh (belonging to Devi Concrete Products) has been issued under the criminal sections of the Prevention of Money Laundering Act (PMLA). The properties belong to Amar Mulchandani, former chairman of Seva Vikas co-operative Bank, Vivek Aranha, promoter of Pune-based Rosary Education group, Sagar Suryawanshi, Khemchand Bhojwani and their family members and linked entities. The case stems from a Pune Police FIR against the Rosary Education group, its promoters and others with regard to an alleged loan fraud, the ED said in a ...

Bank of Baroda 'well protected' for switch to RBI's new loan-loss proposal

Its gross non-performing assets (NPA) ratio fell to 3.79% in the fourth quarter from 4.53% in the previous quarter, while its net NPA ratio fell to 0.89% from 0.99% for the same period