Banking Awareness of 10 and 11 March 2023

Topic: RBI

1. RBI infused ₹82,650 crore into banking system via the 14-day Variable Rate Repo (VRR) auction.

• Banks borrowed ₹82,650 crore at a weighted average rate of 6.53%.
• Notified amount under the VRR auction was ₹1 lakh crore.
• At February 8th bi-monthly monetary policy review, RBI governor said that higher government expenditure and the anticipated return of forex inflows may augment systemic liquidity.
• He said it would get modulated by the scheduled redemption of LTRO (long-term repo operations) and TLTRO (Targeted LTRO) funds during February to April 2023.
• He then said RBI will carry out operations on either side of the liquidity adjustment facility (LAF) on the basis of evolving liquidity conditions.
• Variable Rate Repo (VRR) auction is carried out to withdraw excess liquidity from the system.

Topic: Banking System

2. Divestment of up to 49% of Bank of Baroda’s shareholding in BoB Financial Solutions Ltd (BFSL) has been approved.

• The Board of Directors of Bank of Baroda (BoB) has approved the divestment.
• The board has also given approval to issuance of an advertisement inviting Expressions of Interest (EoI) from investors/ strategic partners to acquire BoB’s shareholding in BFSL.
• BFSL was formerly known as BoB Cards Ltd. It is a non-deposit accepting Non-Banking Finance Company (NBFC).
• It was the first non-banking company in India to issue credit cards.

Topic: Miscellaneous

3. First India-Bangladesh cross-border oil pipeline will be virtually inaugurated by PM Modi and Bangladesh PM Hasina on March 18.

• The 130 km India-Bangladesh Friendship Pipeline will be used to export diesel to Dhaka.
• Out of 130 km, 125 km lies inside Bangladesh's territory and 5 km lies inside India.
• It has been built from approximately ₹3.46 billion, drawn from the Indian Line of Credit (LoC).
• The pipeline stretches from West Bengal’s Siliguri to a Meghna petroleum depot in Dinajpur’s Parbatipur.
• In 2017, an agreement was signed to export diesel to Bangladesh through the pipeline.
• The bilateral project was launched in March 2020. Initially, its deadline was June 2022.

Topic: Reports and Indices

4. NITI Aayog released a task force report on 10 March 2023.

• The report is titled “Production and Promotion of Organic and Bio fertilisers with Special Focus on Improving Economic Viability of Gaushalas”. 
• This report has been released by Prof Ramesh Chand, Member (Agriculture), NITI Aayog in the presence of Taskforce members. 
• This Task Force has been constituted by NITI Aayog to make gaushalas economically viable and to solve the problem of stray and abandoned cattle. 
• It has also been constituted to work for the effective utilization of cow dung and cow urine in the agriculture and energy sectors. 
• Cattle are an integral part of the traditional farming system in India and Gaushalas will help in promoting natural farming and organic farming. 
• The task force report will strengthen the waste to wealth initiative. It will promote the use of organic & bio fertilisers.
• The report provides factual estimates of costs and investments involved in setting up the Bio-CNG plant and PROM (Phosphate Rich Organic Manure) plant in Gaushalas.
• It provides recommendations for improving the financial and economic viability of Gaushalas.
• One of the recommendations of the task force is to make it mandatory for fertilizer companies to sell at least 10-20% of organic manure as part of their mix.
• Ramesh Chand said the implementation of the report would help achieve the target of bringing 25% cultivable area (of gross cropped area of 196 million hectares) under organic/natural farming by 2030.
• He said the recommendations will help gaushalas become at least 50% economically viable.   
• The task force was set up by NITI Aayog under the chairmanship of Ramesh Chand, Member, NITI Aayog.

Topic: Indian Economy/Financial Market

5. India’s industrial production increased by 5.2% in January 2023.

• Industrial production stood at 4.7% in December and 2% in January last fiscal.
• Output of the manufacturing sector increased by 3.7% in January 2023 against 1.9% in last January.
• Mining output increased 8.8% and power generation increased 12.7% in January 2023.
• Consumer durables output contracted for the 2nd consecutive month. It decreased 7.5% in January 2023.
• Consumer non-durables output grew 6.2% in January 2023.
• Intermediate goods output did not change much on year-on-year basis.
• Capital goods production increased 11% in January 2023. Primary goods production grew 9.6% in January 2023.   
• Infrastructure and construction goods’ output increased 8.1% in January 2023.

Topic: Banking System

6. Axis Bank has tied up with ITC Ltd to offer loans to farmers who are part of agriculture ecosystem of ITC.

• The tie up will make it possible for Axis Bank to cater to the financial requirements of unserved and under-served farmers in remote regions.
• The bank will offer them many assets and liability products such as farmer loans and gold loans.
• Axis Bank will use ITCMAARS (Meta Market for Advanced Agricultural Rural Services) to reach out to the farmers and address their financial requirements. ITCMAARS is a full-stack agri-tech application.
• The bank will also provide farmers products and services through its rural-urban and semi-urban (RUSU) branches.
• Through this initiative, the aim of Axis Bank is to further scale up its Bharat Banking strategy by adding new-to-bank accounts.
• Axis Bank is the third-largest private sector bank in India that is headquartered in Mumbai. Its MD & CEO is Amitabh Chaudhry.
• ITC Limited is an Indian conglomerate company. It is headquartered in Kolkata.

Topic: Appointments

7. Bhanu Vohra has been named by Citi as Head of Commercial Banking in India.

• Bhanu Vohra will be responsible for the Citi Commercial Bank (CCB) business in India.
• He replaces Tushar Vikram. Tushar Vikram becomes the Global Head of Healthcare for Citi Commercial Bank.
• Vohra will be reporting to CEO of Citi India, Ashu Khullar and Head of Citi Commercial Bank Asia Pacific, Rajat Madhok.
• Citi is an American multinational investment bank. It is headquartered in New York City.

Topic: Miscellaneous

8. The extension of its National Pension Scheme (NPS) services to its domestic and NRI customers has been announced by Muthoot Finance.

• Muthoot Finance has announced the extension of NPS services through its website and the iMuthoot app.
• The iMuthoot application allows the customers to have a ‘Do It Yourself Model’.
• Under this model, users can submit the application and complete the NPS registration by themselves.
• Muthoot Finance is an authorised NPS service provider by the Pension Fund Regulatory and Development Authority (PFRDA).
• By providing the extension of NPS services to its customers, the aim of Muthoot Finance is to provide its customers with an extra avenue for long-term retirement planning.
• Muthoot Finance also aims to offer its customers a tax concession of up to ₹50,000 under subsection 80 CCD (1B).
• Muthoot Finance is the largest gold loan Non-Banking Financial Company (NBFC) in India. It is headquartered in Kochi, Kerala.

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