Banking Awareness of 6, 7 and 8 July 2024

Topic: Indian Economy/Financial Market

1. Announcements of corporate investments fell to a 20-year low in Q1FY25.

• According to Bank of Baroda's economic research department (ERD), corporate investment announcements fell to a 20-year low level of ₹44,300 core in the first quarter of FY25.
• Elections could be the only reason for this, according to the ERD report. 
• The previous lowest level of corporate investment announcements were seen in June 2005.
• Investments stood at ₹2.9 lakh crore for Q1 of FY15. For Q1 of FY20, investments stood at ₹2.1 lakh crore.
• Manufacturing accounted for the majority of all investment intentions in the first quarter of FY25.
• With a 46.4% share, it was followed by energy (23.5%), services other than finance (22.2%), and real estate & construction (7.9%).
• There was a ₹7.4 lakh crore decline in the value of investment announcements between June 2023 and June 2024.
• According to the BoB study, corporate bond issuances during the first quarter of the year followed the pattern seen in corporate investment announcements.
• From Rs 1.43 lakh crore in Q1-FY23 to ₹2.86 lakh crore in Q1-FY24, the total amount of issuances had grown.
• In Q1-FY25, total issuances dropped sharply to ₹1.73 lakh crore.
• In the first quarter of this year, the financial services sector accounted for 76% of bond issuances.

Topic: Banking System

2. In the first quarter of FY25, Bank of Maharashtra and UCO Bank both reported strong credit growth.

• However, these banks' deposit growth is still trailing behind their credit growth.
• The Bank of Maharashtra has said that in Q1FY25, gross advances increased by 19.01% year over year (yoy) and total deposits increased by 9.44% yoy.
• ₹2,09,065 crore (₹1,75,676 crore as of June-end 2023) was the gross loans as of June-end 2024, according to the bank's provisional quarterly business update.
• Its total deposits as of June 30, 2024, were ₹2,67,423 crore (₹2,44,365 crore).
• The share of current account, savings account (CASA) deposits decreased from 50.96% at the end of June 2023 to 49.86% at the end of June 2024.
• The credit-deposit ratio (C-D) increased from 71.89% at June 30, 2023, to 78.18% at that same time in 2024.
• For the first quarter of FY25, UCO Bank recorded a 17.78% year-over-year (yoy) growth in gross advances and a 7.39% yoy growth in total deposits.
• As per the bank's provisional quarterly business update, as of June-end 2024, its gross advances were ₹1.94 lakh crore (₹1.64 lakh crore as of June-end 2023).
• The bank's total deposits as of June 30, 2024, were ₹2.68 lakh crore (₹2.50 lakh crore).
• As of June 30, 2024, the share of current account, savings account (CASA) deposits increased to 38.62% from 38.10% in 2023.
• As of June 30, 2024, the credit-deposit ratio was 72.15%, up from 65.79% at that same time in 2023.

Topic: Banking System

3. LIC raised stake in IDFC First Bank.

• Life Insurance Corporation of India has increased its stake in IDFC First Bank from 0.20% to 2.68%.
• LIC bought 18,60,34,900 shares at an average price of Rs 80.63 via private placement offer on 4 June 2024.
• IDFC First Bank is a universal bank. It is an Indian private-sector bank. It was founded in 2015.
• It is headquartered in Mumbai. V. Vaidyanathan is its MD & CEO. Its shareholding pattern is given below (as of September 2023).

Topic: Appointments

4. Bandhan Bank has appointed Ratan Kumar Kesh as interim Managing Director and Chief Executive Officer (MD & CEO).

• The board of Bandhan Bank has approved his appointment for three months or until the new MD & CEO takes charge, whichever is earlier.
• The appointment of Kesh as the Interim MD & CEO is with effect from July 10.
• The appointment of Kesh is subject to the approval of the shareholders of the bank.
• Ratan Kumar Kesh is Executive Director and Chief Operating Officer at the bank. He was earlier with Axis Bank.
• The current MD & CEO, Chandra Shekhar Ghosh, will retire on July 9 upon completion of his current tenure.
• Ghosh has been the bank’s Managing Director and Chief Executive Officer since July 10, 2015.
• Bandhan Bank started operations as a universal bank on August 23, 2015.
• It became India’s first microfinance institution to get a universal banking licence from RBI.

Topic: RBI

5. RBI cancelled licence of Shimsha Sahakara Bank Niyamitha.

• RBI said the bank ceases to conduct banking business with effect from the close of business on July 05, 2024.
• RBI has cancelled the licence of Karnataka based bank because of its worsening financial position.
• The Registrar of Cooperative Societies, Karnataka has also been requested to issue an order for winding up the bank.
• Every depositor would be entitled to get deposit insurance claim of deposits up to Rs 5 lakh from Deposit Insurance and Credit Guarantee Corporation (DICGC).

Topic: RBI

6. Punjab National Bank was fined a total of Rs 1.32 crore by RBI.

• Penalty have been imposed for breaking Know Your Customer (KYC) as well as loans and advances related norms.
• Two corporations owned by the state government were granted working capital demand loans by PNB.
• These loans were granted against amounts receivable from the government by way of subsidies, refunds, or reimbursements.
• PNB failed to keep the records related to the identification of customers and their addresses.
• These records were obtained during the course of the business relationship in certain accounts.

Topic: Miscellaneous

7. An 80% concession in licensing fees for women entrepreneurs was announced by Union Minister Piyush Goyal.

• On 3 July, the Stakeholder Consultation was organized by the Department for Promotion of Industry and Internal Trade (DPIIT).
• The objective of the program was to enhance efficiency within the Petroleum and Explosives Safety Organisation (PESO) and improve communication with industry stakeholders.
• During the event, Goyal announced a concession of 80% in license fee for women entrepreneurs and 50% for MSMEs for licenses granted by PESO.
• He directed PESO to prepare guidelines to outline safety measures in consultation with the Central Pollution Control Board (CPCB) and the Ministry of Petroleum and Natural Gas (MoPNG).
• This will allow retail outlets for petrol pumps to function in cases where there is habitation within 30–50 metres.

Topic: Miscellaneous

8. India’s defence manufacturing sector registered a 16.7% increase in the fiscal year 2023–24.

• It is the highest-ever growth in the country’s defence production value.
• The total value of defence production has reached a record high of Rs 126887, up from the previous year’s figure of Rs 1,08,684 crore.
• The defence PSUs and other PSUs accounted for approximately 79.2 percent of the total production value in FY 2023–24.
• The private sector contributed 20 percent to the total production value.
• The central government has set a target of achieving indigenous defence manufacturing worth Rs 1,75,000 crore by the fiscal year 2024–25.
• India’s defence exports have increased by 32.5% from Rs 15,920 crore to Rs 21,083 crore in FY 2023–24.

Topic: Miscellaneous

9. Women Entrepreneurship Platform (WEP) and TransUnion CIBIL have launched the Society for Empowerment of Human Resources (SEHER) ​​programme.

• It will empower women entrepreneurs in India with financial literacy content and business skills.
• The Women Entrepreneurship Platform's (WEP) is a public-private partnership platform incubated at Niti Aayog.
• SEHER program is part of WEP’s Financing Women Collaborative (FWC).
• FWC is a first-of-its-kind initiative aimed at accelerating access to finance for women entrepreneurs.
• India has 63 million micro, small, and medium enterprises, of which 20.5% are women-owned.
• Rural areas have a slightly higher share of women-owned enterprises (22.24%) compared to urban areas (18.42%).
• TransUnion CIBIL Limited is a credit information company operating in India.

Topic: Corporates/Companies

10. LIC started the "Jeevan Samarth" project to address the changing needs of its clients.

• In order to carry out the transformation project, LIC has teamed up with A T Kearney.
• For carrying out this project, LIC will review its current agency architecture from beginning to end.
• LIC hopes to change its agency ecosystem through this project so that it may better serve the continually changing demands of millions of Indian families.
• In addition, LIC wants to offer them pension plans, ULIPs, health insurance, protection, and appropriate long-term savings.

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