Banking Awareness of 20, 21 and 22 December 2022

By Priyanka Chaudhary | Last Modified: 24 Dec 2022 20:29 PM IST
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Topic: MoUs/Agreements

1. Bandhan Bank has signed a Memorandum of Understanding (MoU) with Ministry of Defence.

  • Bandhan Bank has signed this MoU for extending banking services to the defence pensioners and their families through its 557 branches.
  • The banking services to defence personnel will be provided under the System for Pension Administration Raksha (SPARSH).
  • System for Pension Administration Raksha (SPARSH) is an initiative of the Ministry of Defense. It provides a single-window for the pensioners to avail pension related services.
  • Bandhan Bank is a Kolkata based Indian banking and financial services company. Dr. Anup Kumar Sinha is its current chairman. Chandra Shekhar Ghosh is its MD and CEO.

Topic: Banking System

2. A divergence of ₹259-crore has been found by RBI in City Union Bank’s FY22 gross NPAs.

  • The gross NPAs reported by the bank as on March 31, 2022 were ₹1,933 crore, but as assessed by RBI they were ₹2,192 crore.
  • RBI carried out an on-site Inspection for Supervisory Evaluation (ISE) for FY22 from October 7, 2022, to November 18, 2022.
  • The divergence amount consists of 13 borrower accounts for an amount of Rs 230 crore and 218 borrowers for and amount of Rs 29 crore.
  • City Union Bank:
    • It is an Indian bank headquartered in Kumbakonam, Tamil Nadu. It is a Private Sector Bank.
    • R. Mohan is its current Chairman. N. Kamakodi is its MD and CEO.

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Topic: RBI

3. A penalty of ₹2.66 crore has been imposed by RBI on Bank of Bahrain & Kuwait BSC, India operations.

  • RBI has imposed the penalty for non-compliance with regulatory directions on “Cyber Security Framework in Banks”.
  • RBI found non-compliance with the directions. It conducted the information technology examination of the bank in October 2021.
  • RBI said that the bank failed to implement systems to detect unusual and unauthorised, internal or external activities in its database and other things.
  • RBI has also imposed penalty on 20 co-operative banks. They include 17 banks from Gujarat.
  • In addition to co-operative banks of Gujarat, RBI has imposed a penalty of Rs 50 lakh on Bassein Catholic Co-operative Bank, Vasai (Maharashtra).
  • RBI has also imposed penalty of Rs 30.85 lakh on The Delhi State Cooperative Bank, New Delhi and Rs 26.91 lakh on The Andhra Pradesh State Co-operative Bank, Vijayawada. 

Topic: Indian Economy/Financial Market

4. HDFC Securities has launched Google search driven investor education and market analysis platform, Roots.

  • Roots is dedicated for providing comprehensive investor education and market analysis.
  • It offers articles, tips, podcasts, video explainers and live social media feed on the Indian financial markets.
  • Roots also has a component for user generated content. Traders and investors can recommend subjects they want to learn about.
  • HDFC Securities Limited is a financial services intermediary of HDFC Bank.
Monthly Banking/ Financial Awareness Books
November Financial Awareness 2022 September Financial Awareness 2022
October Financial Awareness 2022 August Financial Awareness 2022

Topic: Miscellaneous

5. India will host next negotiation round for Indo-Pacific Economic Framework (IPEF) for Prosperity in February 2023.

  • Commerce and Industry Minister Piyush Goyal attended the virtual Ministerial meeting on economic benefits of IPEF.
  • He invited all partner nations for the next special negotiation round for pillars 2-4 of IPEF to be hosted by India on February 8-11, 2023.
  • US President Joe Biden launched 14-member IPEF in May 2022 in Tokyo.
  • Its members include Australia, Brunei, Fiji, Indonesia, India, Japan, Republic of Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand, the US and Vietnam.
  • IPEF’s four pillars of discussions are trade, supply chains, clean economy and fair economy.  
  • India has chosen to abstain from the trade pillar for now and will only take part in discussions regarding the other three.

Topic: Indian Economy/Financial Market

6. Union Minister of Road Transport & Highways, Nitin Gadkari, launched India’s first ever ‘Surety Bond Insurance’ product.

  • This product has been developed by Bajaj Allianz General Insurance, a private general insurer.
  • Surety Bond Insurance will help replace bank guarantees. It is mainly aimed at infrastructure development.
  • It is a risk transfer tool that protects the principal from the losses arising if the contractor fails to fulfil contractual obligation.
  • If the contractor fails to fulfil the contractual terms, principal can raise a claim on the Surety Bond and recover the incurred losses.
  • In contrast to a bank guarantee, the Surety Bond Insurance does not need a large collateral from the contractor.
  • In this way, Surety Bond Insurance frees up significant funds for the contractor. The contractor can use the fund to grow the business.
  • The product will also reduce the contractors’ debts to a large extent.
  • It will support the growth of upcoming infrastructure projects in the country.
  • The Surety insurance business will help in developing an alternative to bank guarantees for construction projects.

Topic: Regulatory Bodies/Financial Institutions

7. Competition Bill proposes that the overall time limit for assessment of combination cases by CCI shall be reduced to 150 days.

  • Presently, the overall time limit for assessment of combination cases by Competition Commission of India (CCI) is 210 days.
  • Finance and Corporate Affairs Minister Nirmala Sitharaman recently said that the proposed time limit of 150 days is reasonable in view of making the assessment for combinations time bound and quicker.
  • Parliamentary Standing Committee has recently recommended that current time limit of 210 days be kept unchanged.
  • Competition (amendment) Bill 2022, introduced in Lok Sabha on August 5, had obligated CCI to form prima facie opinion within 20 calendar days.
  • Nirmala Sitharaman said that CCI had in the past five years (November 2017 to October 2022) imposed a penalties amounting to ₹ 6724.77 crore.
  • Out of the total penalty imposed by CCI in last five years, the IT sector accounted for the highest at ₹2,413 crore.
  • The IT Sector is followed by automobiles sector (at ₹1,989 crore), tourism (at ₹392 crore) and textiles (at ₹301 crore).

Topic: Indian Economy/Financial Market

8. Fitch Ratings has kept India’s sovereign rating at ‘BBB-’ with a stable outlook.

  • BBB- is the last investment rating. Stable outlook signifies rating to be kept at status quo for some time.
  • In June, global agency had upgraded the outlook to stable from negative.
  • The agency has estimated economy to grow at 7% during the current fiscal. However, it expects the growth to slow to 6.2% in FY24.
  • The agency considered current level of fiscal deficit high. It said the Centre and states’ combined deficit declined from pandemic high level of 13.5% of GDP.
  • The agency expects fiscal deficit to fall slightly from 9.8% in FY22 to 9.6% of GDP in FY23.

Topic: RBI

9. RBI gives in principle nod to Worldline ePayments India to act as payment aggregator.

  • Worldline ePayments India (WEIPL) has received in-principle authorisation from the Reserve Bank of India to act as a payment aggregator.
  • WEIPL received a communication to this effect from RBI on 20 December.
  • Payment aggregator provides payment services to merchants and e-commerce sites by accepting payment instruments from customers.
  • Worldline ePayments India is part of Worldline Group, which is a financial services company.

Topic: Reports and Indices

10. Social Progress Index (SPI) for States and Districts released on 20 December 2022.

  • SPI for States and Districts submitted to Economic Advisory Council- Prime Minister.
  • It has been made by the Institute for Competitiveness and Social Progress Imperative.
  • Puducherry, Lakshadweep, and Goa are the best-performing states in SPI.
  • Aizawl (Mizoram), Solan (Himachal Pradesh), and Shimla (Himachal Pradesh) are the top 3 best-performing districts in SPI.
  • Puducherry has the highest SPI score of 65.99 in the country. Jharkhand and Bihar scored the lowest, 43.95 and 44.47, respectively.
  • Goa, Puducherry, Lakshadweep, and Chandigarh are top four states across the dimension of Basic Human Needs with the best performance in Water and Sanitation and Shelter.
  • Mizoram, Himachal Pradesh, Ladakh, and Goa are the best-performing states for the Foundations of Wellbeing.
  • Punjab has the highest component score of 62.92 within the dimension for the Access to Basic Knowledge component.
  • Delhi has performed best in the list for Access to Information and Communication with a score of 71.30.
  • Tamil Nadu has achieved component score of 72.00 for the Opportunity dimension, which is highest.
  • Within the Opportunity dimension, Andaman and Nicobar Islands have the highest component score for Personal Rights. Sikkim has the highest score for Inclusiveness.
  • Puducherry achieved the highest scores across two components in this dimension, i.e., Personal Freedom and Choice and Access to Advanced Education.
  • Social Progress Index (SPI):
    • It assesses states and districts based on 12 components across three critical dimensions of social progress - Basic Human Needs, Foundations of Wellbeing, and Opportunity.
    • It uses an extensive framework comprising 89 indicators at the state level and 49 at the district level.
    • Based on the SPI scores, states and districts have been ranked under six tiers of social progress.
    • 2022 SPI for India evaluates 36 states/UTs and 707 districts.

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Daily Banking Awareness Quiz | 11, 12 and 13 December 2022

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Daily Banking Awareness Quiz | 9 and 10 December 2022

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Daily Banking Awareness Quiz | 6, 7 and 8 December 2022

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Daily Banking Awareness Quiz | 4 and 5 December 2022

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