Banking Awareness of 4 and 5 July 2025

Topic: Indian Economy/Financial Market

1. SEBI has barred Jane Street and its affiliates from trading in Indian securities markets.

• The ban is due to alleged market manipulation.
• SEBI has also ordered the firm to return ₹4,844 crore.
• This amount is considered to be illegally earned through expiry-day trades in Bank Nifty options.
• The investigation found repeated manipulation of index prices.
• Jane Street placed large, aggressive trades in both cash and futures markets on expiry days.
• These trades distorted index movements to benefit their options positions.
• The firm’s actions misled smaller retail traders.
• They aimed to secure favorable expiry prices for their own profit.
• SEBI stated the trades lacked any real market justification.
• They appeared to be purely intended to move prices unfairly.
• Despite receiving a caution from NSE in February 2025, Jane Street continued similar trading.
• Over the last two years, Jane Street held the largest exposure in F&O markets on expiry days.
• SEBI said these actions violated the PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) regulations.
• From January 2023 to March 2025, the firm earned a net profit of ₹36,671 crore in Indian derivatives.
• SEBI calculated ₹4,844 crore of that as unlawful profit.
• This amount must now be held in an escrow account with a scheduled Indian bank.
• SEBI also froze all debit transactions from Jane Street’s Indian bank accounts.
• The regulator has prohibited four affiliated entities from buying or selling securities in India.
• SEBI whole-time member Ananth Narayan issued the interim order.
• He criticized the firm’s conduct as manipulative and unacceptable.
• Jane Street is expected to appeal the decision in the Securities Appellate Tribunal.
• However, as per legal experts, a favorable outcome is unlikely.

Topic: Reports and Indices

2. India’s services sector PMI rose to 60.4 in June 2025.

• This marked its highest level in ten months, according to S&P Global.

• The increase was driven by strong growth in business activity and domestic demand.
• Hiring remained positive for the 37th consecutive month.
• However, the pace of job creation slowed compared to May.
• The services sector contributes more than half of India’s Gross Value Added (GVA).
• Finance and insurance saw the strongest expansion in output and orders.
• In contrast, real estate and business services recorded the weakest growth.
• Input cost inflation eased to its lowest level in ten months.
• It also fell below the sector’s long-term average.
• Rising staff salaries and wages were the main drivers of cost increases.
• Business optimism declined, with only 18% of firms expecting growth.
• This was the lowest confidence level since mid-2022.
• Manufacturing PMI reached 58.4 in June 2025. This marked a 14-month high.

Topic: RBI

3. Kesavan Ramachandran has been appointed as Executive Director at the Reserve Bank of India.

• His appointment is effective from July 1, 2025.

• Before this, he served as Principal Chief General Manager in the Risk Monitoring Department.
• In his new role, he will lead the Prudential Regulation Division under the Department of Regulation.
• Ramachandran has over 30 years of experience in banking supervision and currency operations.
• He was RBI’s nominee on the Board of Canara Bank for more than five years.
• He also served on the Auditing and Assurance Standards Board of the ICAI for two years.
• In March 2025, Indranil Bhattacharyya was also appointed as Executive Director at RBI.
• Bhattacharyya now heads the Department of Economic and Policy Research.
• Earlier, he worked as Adviser in the Monetary Policy Department.
• His appointment took effect on March 19, 2025.

Topic: Appointments

4. Sunil Kadam assumed charge as new executive director of SEBI.

• Sunil Jayawant Kadam has been promoted to executive director at SEBI.
• Earlier, he served as the chief general manager at the same organization.
• In his new role, he will manage the information technology department.
• He will also oversee investor outreach and education initiatives.
• Additionally, he will handle matters related to the National Institute of Securities Markets (NISM).
• His responsibilities include economic and policy research.
• He will look after general administrative services as well.
• He will also coordinate activities related to the board, RTI, and parliamentary queries.
• Kadam has been associated with SEBI since 1996.
• He previously served as the regional director of SEBI’s Northern Regional Office.
• He has also held the position of registrar at National Institute of Securities Markets (NISM).

Topic: Summits/Conferences/Meetings

5. Shri Harsh Malhotra inaugurated the third edition of the National Conference on Responsible Business Conduct (NCRBC) 2025.

• He is Union Minister of State for Corporate Affairs and Road Transport & Highways.

• The inauguration event took place on July 2nd at the Taj Palace Hotel in New Delhi.
• It is being organised by the Indian Institute of Corporate Affairs (IICA), an autonomous body under the Ministry of Corporate Affairs.
• The two-day national conference is focused on the theme “Integrating ESG for Viksit Bharat.”
• Over 300 participants attended, including senior corporate leaders, ESG professionals, policymakers, and international delegates.
• Shri Malhotra emphasized that India is shifting from a compliance-driven system to one based on trust and ethical corporate governance.
• He highlighted key reforms led by the Ministry of Corporate Affairs.
• These include the National Guidelines on Responsible Business Conduct (NGRBC) and the Business Responsibility and Sustainability Reporting (BRSR) framework.
• He also mentioned the introduction of MCA21 Version 3.0 to enhance digital corporate governance.
• Another major reform is the decriminalisation of more than 180 statutory provisions under the Jan Vishwas Act.
• The conference aims to promote responsible business conduct as a foundation for India’s development by 2047.
• NCRBC 2025 is supported by Ministry of Corporate Affairs and several partner organisations.
• These include UNICEF India, Partners-in-Change, ICAI, ACCA, Global Alliance for Improved Nutrition (GAIN), Access to Nutrition Initiative (ATNi), ILO, and the Responsible Business Alliance (RBA).

Topic: Indian Economy/Financial Market

6. Gujarat became the third Indian state to cross one crore stock market investors.

• According to the latest data released by the National Stock Exchange (NSE), Gujarat has become the third state in the country to have more than one crore registered stock market investors.

• Maharashtra and Uttar Pradesh are the other two states to have achieved this milestone, collectively accounting for 36% of India's total investor base.
• According to NSE data, the total number of registered investors in the country as of May 2025 was around 11.5 crores.
• Over 11 lakh new investors joined in May alone, registering a 9% month-on-month rise.
• This comes after four consecutive months of decline in new registrations.
• Region-wise, North India leads with 4.2 crore investors, followed by West India with 3.5 crore, South India with 2.4 crore, and East India with 1.4 crore investors.
• North and East India recorded the highest annual growth rates in investor numbers at 24% and 23%, respectively.
• South India’s investor base grew by 22%, while West India reported a 17% increase during the last year.
• India crossed the 9 crore investors mark in February 2024 and added the next one crore every five to six months, reaching 10 crores by August 2024 and 11 crores by January 2025.
• However, the growth rate slowed down from February to May 2025, with an average of 10.8 lakh new investors joining per month, compared to a monthly average of 19.3 lakh new investors in calendar year 2024.

Topic: Banking System

7. India’s scheduled commercial banks have improved their financial stability.

• Gross NPAs dropped to 2.3%, and net NPAs fell to 0.5%.
• These are the lowest levels seen in several decades.
• Between March 2024 and March 2025, gross NPAs declined from 2.8% to 2.3%.
• This reflects stronger asset quality across the banking system.
• Public-sector banks showed a sharp improvement in asset quality.
• Their gross NPA ratio fell from 3.7% to 2.8% during the same period.
• Private-sector banks kept their gross NPA ratio steady at 2.8%.
• The RBI’s Financial Stability Report highlighted strong capital buffers and healthy earnings.
• These factors support the overall resilience of the banking sector.
• Stress tests indicated that banks would remain well-capitalized even in adverse conditions.
• Urban cooperative banks have improved their capital positions.
• Non-banking financial companies continue to maintain capital levels above the regulatory minimum.
• The insurance sector’s solvency ratio remains above the required threshold.
• This applies to both life and non-life insurance segments.

Topic: Banking/Financial/Govt Schemes

8.  ₹99,446 crore Employment-Linked Incentive Scheme approved by Cabinet.

• On 1 July, an Employment-Linked Incentive (ELI) Scheme with an allocation of ₹99,446 crore has been approved by the Union Cabinet.
• The scheme has been approved to support employment generation primarily in the manufacturing sector while enhancing employability and social security across all sectors.
• The ELI scheme aims to stimulate the creation of over 3.5 crore jobs in two years.
• Of these, 1.92 crore beneficiaries will join the workforce for the first time.
• The benefits of the scheme will be applicable to jobs created between August 1, 2025, and July 31, 2027.
• Keeping in mind the first-time employees registered with EPFO, in this part, one month's EPF salary up to Rs 15,000 will be given in two installments.
• Employees with salaries up to Rs 1 lakh will be eligible for this.
• The first installment will be payable after 6 months of service, and the second installment after 12 months of service and completion of the financial literacy program by the employee.
• To encourage the habit of saving, a part of the incentive amount will be kept in the saving instrument of deposit account for a fixed period and can be withdrawn by the employee at a later date.
• Employers will get incentives in respect of employees with salaries up to Rs 1 lakh.
• The government will provide employers with an incentive of up to Rs 3,000 per month for each additional employee with continuous employment for at least six months for a period of two years.
• The ELI scheme was announced in the Union Budget 2024-25 as part of the Prime Minister's package of five schemes.
• It aims to facilitate employment, skilling, and other opportunities for 4.1 crore youth, with a total budget outlay of Rs 2 lakh crore.
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