Executive Committee of the Central Board of Directors (ECCB) of SBI at its meeting accorded final approval for divestment of its stake in UTI AMC up to 8.25 per cent through IPO by way of offer for sale of up to 1,04,59,949 equity shares subject to the approval of the SEBI and/or such other concerned authorities and departments.
SBI, LIC, PNB and Bank of Baroda hold 18.5 per cent stake in UTI AMC, each. The rest is held by American company T Rowe Price. SBI has its own AMC (asset management company) business. SEBI rules introduced in March 2018 put a cross-holding limit which does not allow a shareholder who has at least 10 per cent stake in a mutual fund to hold a similar-sized stake in another fund house. Board positions would also have to be given up.
Banking crisis in India seems to be looming large due to faulty policy as PMC Bank crisis is yet another addition to such brimming incidences with Mumbai police arresting two directors of HDIL – Rakesh Wadhavan and Sarang Wadhavan. Actually the responsibility of failing of PMC Bank is attributed to its 10 accounts out of 44 accounts in the PMC Bank.
The two directors were summoned by economic offence wing of Mumbai police but they did not turn up and they have been asked not to use property worth Rs 3,500 of HIDL. The company is accused of inflicting loss to the bank to the tune of Rs 4,355.4 crore.
If some well placed sources are to be believed approximately 11,500 employees of Axis Bank have resigned in past four months. Recently, Mcqueary Australia has rated the top official of the bank which adds to the apathy of the banking sector as a whole. Further, many more seniors are slated to quit along with the entire team.
Some top officials of the banking sector say that in private sector banks this is a usual trend. They attribute this phenomenon to the mobility of skilled work-force and poaching. They say that private sector banks especially banks namely; ICICI, HDFC, Kotak and Yes Bank keep poaching amongst themselves which often results into exodus of employees and keeping in view the same 11,500 is not a figure that they may underline the banking-sector crisis. Obviously, those employees would have gone to other banks and Axis would have got from others that means zero net loss.
Whatever is the reason, impact and ground reality of banking sector but it is very surprising that no one is talking about it?
Investment of LIC in IDBI Bank has erodes by more than half over the past year or so and also the value of its investments in other PSBs plunged. Plunge in price of PSB stocks and dilution of its stake owing to capital infusion by the government has eroded its wealth in these banks. Besides IDBI Bank, LIC has lost over ₹4,800 crore since June 2018.
Further the merger move would hurt insurance company more in future. Around 20-30 per cent dilution in the book value of the merged entities — PNB, Canara Bank, Union Bank and Indian Bank — over the next year or so will lead to LIC’s value of holdings in PSU Banks erode further.
The government infusing capital into PSBs eroded value for investors. This is because most of the PSBs trade at a steep discount to their book value and hence the government infusing capital at such low valuations immediately leads to dilution in equity base.
The CBDT may share information of assets of borrowers with
the banks to prevent loan defaults in public sector banks. For this purpose, on
June 25 it issued a directive asking all principal chief commissioners to share
information under section 138(1)(b) of the Income-tax Act about individuals
with more than Rs 50 lakh of annual income.
"Since the information on assets as contained in the income tax return in specified cases is received by the tax authority.....board is of a view that sharing of information with PSBs in respect of assets held by defaulters of loans, so as to enable recovery of loans from such defaulters, is in public interest and hence, can be furnished," the directive said.
Tax department not only aims to share information of immovable assets of loan defaulters with the public sector banks but also intends to provide "information, such as, details of bank account, sundry debtors of the loan defaulter which may aid recovery of loan by PSB."
However, the information will be given to the banks after an undertaking is received and the information will be given for borrowers, mortgages, and guarantors in the loans with a confidentiality clause and must be used only for the purpose of recovery of loans.
Sources added that in order to ensure that the tax dues against the defaulter (if any) are safeguarded, the CBDT insists on obtaining a no-objection certificate from the jurisdictional commissioner of income tax of the loan defaulter â€œbefore appropriation of theâ€¦ amount recovered from sale ofâ€¦ the asset of the defaulter, the information in respect of which is shared.â€
The NaMo administration on Tuesday announced the appointment of Karnam Sekar appointed MD & CEO of Indian Overseas Bank ( w.e.f. 01 July 2019) till his retirement on 30 June 2020. Presently, Karnam is MD & CEO of Dena Bank. He is considered OSD and Whole-time Director in IOB beginning 01 April 2019. Further, R A Sankara Narayan (MD & CEO, Vijaya Bank) was appointed to the post of MD & CEO in Canara Bank till his retirement on 31 January 2021.
In addition, appointments of OSDs and EDs were also cleared in various public-sector banks. Accordingly;
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