Banking Awareness of 29 and 30 November 2022

By PendulumEdu | Last Modified: 30 Nov 2022 19:23 PM IST
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Topic: Banking System

1. Tamilnad Mercantile Bank (TMB) has entered into bancassurance partnerships with Cholamandalam MS General Insurance and Max Life Insurance.

  • As part of the partnership, TMB will provide general insurance products of MS General Insurance Company Ltd to its customers.
  • TMB will also provide life insurance schemes of Max Life Insurance Company to its customers.
  • The bank will also work with both the partners to offer tailor-made products for its customers in future.
  • Tamilnad Mercantile Bank is a Thoothukudi (Tamil Nadu)-based bank. S Krishnan is its MD & CEO. It is a private bank. Its tagline is Be a step ahead of life.

Topic: Indian Economy/Financial Market

2. S&P Global Ratings lowered India’s economic growth forecast for FY23 to 7%.

  • However, it said that domestic demand-led economies like India will be less impacted by the global slowdown.
  • In September, S&P had projected the Indian economy to grow 7.3% in FY23 and 6.5%in FY24.
  • It has now said that India’s output will expand 6% in the next fiscal year.
  • It projected inflation (average) at 6.8% in FY23. It projected that RBI’s benchmark interest rate will rise to 6.25% by March 2023.
  • RBI has already hiked the interest rate to a 3-year high of 5.9%.
  • S&P has projected the exchange rate to remain at Rs 79.50 to a dollar by March-end, as against the current Rs 81.77 to a dollar.
  • Earlier, World Bank has cut its growth estimate for India by 100 basis points to 6.5%. IMF has cut it to 6.8% from 7.4%.
  • Asian Development Bank has cut its projection from 7.5% to 7%.

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Topic: Miscellaneous

3. Adani Group is set to win Asia’s biggest slum redevelopment project – Dharavi redevelopment with a bid of ₹5,069 crore.

  • Dharavi is one of the largest slum clusters in Asia. Three companies had submitted bids for its redevelopment.
  • They were Adani Realty, DLF and Naman Group. Naman group did not qualify in the technical bidding for the Dharavi redevelopment project.
  • Adani has bid ₹5,069 crores, DLF has filed a bid of ₹2,025 crores.
  • Dharavi redevelopment authority will go to the State government for approvals and set up a Special Purpose Vehicle for the project.
  • The 20,000 crore project is expected to be finished in 17 years, with the rehabilitation phase taking seven years to complete.

Topic: Regulatory Bodies/Financial Institutions

4. PFRDA allowed National Pension System (NPS) digital onboarding through Central KYC (CKYC).

  • Through a circular, PFRDA has informed that prospective subscribers are provided with another option for opening NPS Account through CKYC through an online and paperless process.   
  • CKYC is a government initiative. It allows NPS subscribers/ financial investors to complete their KYC only once in order to interact with many service providers across financial sector under the ambit of various regulators.
  • CKYC is managed by CERSAI. CERSAI is the government authorized entity to function as Central KYC Registry (CKYCR).
  • CKYC Identification Number is a 14-digit number. It is allotted by CERSAI to an investor after completion of CKYC formalities.    
  • Central Registry of Securitisation Asset Reconstruction and Security Interest of India (CERSAI) is a central online security interest registry of India. It was founded in March 2011.
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Topic: RBI

5. As per latest RBI data, personal loans’ proportion in overall credit of scheduled commercial banks has risen from 25.94% in 2021 to 27.29% in 2022.

  • Southern region formed the largest proportion of personal loans at 35% in scheduled commercial banks’ overall personal loans portfolio in 2022.
  • Southern region was followed by Western region (26%), Northern region (16%), Central region (12%), Eastern region (9%) and North-Eastern region (2%).
  • Personal loans accounted for 51% of SCBs’ overall credit in North-Eastern region.
  • It was followed by Central region and Southern region (32% each), Eastern region (30%), Western region (25%) and Northern region (20%) as per “Handbook of Statistics on Indian States 2021-22”.      
  • RBI’s latest sectoral deployment of credit data showed that personal loans segment has continuously grown for banks.
  • It has grown to 19.6% in September 2022 from 13.2% a year ago. This growth was largely caused by housing and vehicle loans segments.
  • Personal loans include loans given to individuals and consists of
    • consumer credit,
    • education loans,
    • loans given for creation/ enhancement of immovable assets (e.g., housing, etc.), and
    • loans given for investment in financial assets (shares, debentures, etc.).

Topic: Reports and Indices

6. Year-on-Year (y-o-y) growth in term deposits increased to 10.2% in September 2022.

  • Current account (CA) and savings account (SA) growth moderated to 8.8% and 9.4% from 17.5% and 14.5%, respectively.
  • The data is according to the RBI’s latest report on Quarterly Statistics on Deposits and Credit of Scheduled Commercial Banks (SCBs).
  • The share of savings deposit in total deposits has grown from 32.4% in June 2019 to 35.2% in June 2022.
  • In terms of deposit mobilisation, the private sector bank group has been leading over regional rural banks, foreign banks, and public sector banks.
  • According to the report, bank credit growth improved further to 17.2% (y-o-y) in September 2022 from 14.2% a quarter ago and 7.0% a year ago.
  • However, aggregate deposits growth (y-o-y) stood at 9.8% in September 2022.
  • As per the report, all-India credit-deposit (CD) ratio increased to 74.8% in September 2022 from 73.5% a quarter ago and 70.0% a year ago.
  • CD ratio for metropolitan bank branches stood at 87.6% in September 2022.

Topic: Reports and Indices

7. FMCG industry’s three-year sales compound annual growth rate (CAGR) increased to 12.5% as per a BNP Paribas consumer report.

  • According to the report, most companies delivered pricing-led growth in the personal care segment.
  • Godrej Consumer Products’ (GCP) personal care segment posted 18% y-o-y growth.
  • HUL’s beauty and personal care division posted 11% y-o-y growth in Q2 FY23.
  • Foods and beverage segment of Dabur posted 30% y-o-y sales growth.
  • As per the report, Dabur has continuously outperformed Colgate-Palmolive India in the oral care category.
  • According to a report, housing prices in 3 Indian cities (Mumbai, Bengaluru, and New Delhi) increased 3.1% in Q3 2022, compared to Q3 2021.
  • As per the report, average annual growth across 45 cities was at 7.5% in Q3 2022.
  • The report says that Mumbai climbed up from 39th rank in Q3 2021 to 22nd in Q3 2022.
  • Bengaluru moved up from 41st rank in Q3 2021 to 27th in Q3 2022.
  • New Delhi moved up from 38th rank in Q3 2021 to 36th in Q3 2022.
  • Dubai recorded the fastest rise in prime prices. Wellington was the weakest-performing market.
  • More than 45 locations throughout the world are included in Knight Frank's Prime Global Cities Index, which analyses changes in prime home values in local currency.

Topic: RBI

8. The launch of the 1st pilot for the retail digital Rupee on 1st December 2022 has been announced by RBI.

  • The number of banks identified for phase-wise participation in this pilot is eight.
  • The first phase will begin with four banks in four cities across the country.
  • These four banks are State Bank of India, ICICI Bank, Yes Bank and IDFC First Bank.
  • Four more banks will join this pilot subsequently. These banks are Bank of Baroda, Union Bank of India, HDFC Bank and Kotak Mahindra Bank.
  • Initially, the pilot would cover four cities. These cities are Mumbai, New Delhi, Bengaluru and Bhubaneswar.
  • The pilot would later extend to Ahmedabad, Gangtok, Guwahati, Hyderabad, Indore, Kochi, Lucknow, Patna and Shimla.
  • It would cover select locations in a closed user group (CUG). It would comprise of participating customers and merchants.
  • The digital Rupee would be in the form of a digital token and will have legal validity.
  • Users can transact with digital Rupee through a digital wallet made available by the participating banks and stored on mobile phones.
  • Transactions can be both Person to Person and Person to Merchant.
  • The digital Rupee would have features of physical cash like trust, safety and settlement finality.
  • Like cash, it will not earn any interest and can be changed to other forms of money, like deposits with banks.
  • The pilot will test the robustness of the complete process of digital rupee creation, distribution and retail usage in real time.

Topic: Miscellaneous

9. India’s first retail municipal bond for solar power projects will be issued by Indore Municipal Corporation.

  • Indore Municipal Corporation will raise 2.6 billion rupees ($31.8 million) through a 10-year bond. It will be used to fund solar power projects.
  • A.K. Capital Services Ltd. and SBI Capital Markets Ltd. are the lead managers of the offering.
  • A 60-megawatt solar plant will be built near Indore at a cost of 3 billion rupees.
  • India’s central bank has called on local authorities to consider issuing municipal bonds to meet funding requirements. 
  • For six years in a row, Indore has won India's cleanest city award.

Topic: Awards and Prizes

10. The pavilion of the Ministry of Health and Family Welfare has won the award for “Outstanding Contribution towards Public Communication and Outreach”.

  • The pavilion of the Ministry of Health and Family Welfare won this award at the 41st India International Trade Fair 2022.
  • The health pavilion was one of the most popular pavilions at the trade fair.
  • It conducted as many as 37 thousand 889 screenings, investigations, counseling, and trainings.
  • Nearly 5,530 visitors visited the National Health Authority (NHA) counter where 1,110 visitors got their Ayushman Bharat Health Account cards.

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