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  Is Contingency Fund of RBI Adequate? Surplus Transfer: Reserve Bank of India (RBI) has transferred Rs.99,122 cr. to the Government of India (GoI), being the surplus amount from its financial results for the year 2020-21. This was 74% increase over the surplus transferred last year (relating to 2019-20) (Rs.57128 cr.) and more than double the amount indicated as ‘dividend estimates from RBI’ in the fiscal budget for 2021-22. It surprised many, as RBI launched a slew of measures in 2020-21, which were aimed at reviving the economy (impacted by the COVID Pandemic, resultant lock downs and significantly less economic activity) but were expected to have a definite bearing to the bottom line of its financial results. Some of the measures initiated by RBI includ.  1. Its interest free deposits came down by Rs.1.37 lac cr. as CRR was reduced from 4% to 3%. 2. Due to healthy deposit accretion and the scope for credit growth being subdued, there was a huge surplus left out in the...

Help thro' fiscal grants and not loans   Three Incidents:   1.  Popular Restaurant in Thiruvannamalai:  I was in Tiruvannamalai in Feb 2021, when the Covid first wave had receded to manageable levels and the economy was returning to normalcy. After having had darshan of Lord Annamalai  and Goddess Unnamalai, I proceeded for lunch with my family to one of the famous restaurants, situated a few hundred metres from Ramanashram. The hospitality extended was good but the usual cheer that accompany the chef and staff was absent. The menu card carried all, but items available were barely two or three. And we were the only customers at that time (1.30 p.m.).  When I enquired, the staff informed that only a few of them are still working. The crowd to the restaurant had come down on account of lock down and the foreign tourists, who throng the town, are no longer there. The catch to the restaurant was the presence of foreign tourists and the forex encashed, who ...

  COVID - NEED OF THE HOUR Good morning Friends,  Lie, bloody lie and statistics is what we used to say when we studied statistics.  While using it for past events might be useful depending on the variants used in numerator and denominator, it will conceal the seriousness of issue when used for current events.  For Example:  1. No. of persons affected in COVID as on 8th May 2021: 2.15 cr.       No. of deaths: 2.34 lacs       Percentage of death: 1.09%  2.   No. of persons affected in COVID as on 1st June 2021: 2.81 cr       No. of deaths: 3.29 lacs     Percentage of death: 1.17%  If you do not recollect 8th May figures, you will feel the percentage of death is less in India. But in the last 23 days, the number of deaths is 95000 which works out to 40% more than what was the number of deaths recorded from Mar 2020 to May 2021(14 months) (2.34 lacs).   (Even if you compa...

  CORPORATE GOVERNANCE IN COMMERCIAL BANKS (Edited version of this article appeared in business line on 24.05.2012. The link is  https://www.thehindubusinessline.com/money-and-banking/banks-must-swear-by-rbis-norms-on-governance/article34628641.ece?utm_campaign=amp_article_share&utm_medium=referral&utm_source=whatsapp.com  ) Reserve Bank of India has informed that a Master Direction on governance in commercial banks, based on the “Discussion Paper on Governance in Commercial banks in India” (discussion paper), will be issued in due course. As an immediate measure, the regulator issued operative guidelines with regard to appointments of MD & CEO, WTD (Whole time Director), Chairperson, NEDs (Non-Executive Directors) and composition of important committees like ACB, RMCB, NRC, etc. A brief on the Discussion Paper: In this regard, the main objective of the discussion paper (according to RBI), is to align current regulatory framework with global best practice...

RELEVANCE OF BANK UNIONS TODAY AIBEA celebrated its Platinum Jubilee, having completed 75 years of existence, on 20 th April 2021, with full page advertisements in leading newspapers. Rightly so. It is the proud parent to many of the bank unions that commenced their journey after independence at different points of time and which are fighting under the banner of United Forum of Bank Unions (UFBU) now. All the unions under UFBU, namely AIBEA, AIBOC, NCBE, AIBOA, BEFI, INBEF, INBOC, NOBW and NOBO can cherish their achievements, particularly in the following areas:   1.      Ensuring Job Security to all employees recruited in the 1960s and 70s and recruitment based on selection through recruitment boards, employment exchanges and other proper channels. 2.      Industry-level Bipartite Settlement, ever since 1966, covering all Public Sector Banks (PSBs), majority of old generation private sector banks and a few foreign banks as well. 3...