Chidambaram to sit with financial regulators today
1 Feb 2013 5:08 AM IST
Finance Minister P Chidambaram will meet financial sector regulators on Thursday to seek their inputs for the Budget with a view to improving investment climate and boosting economy.
'He (Chidambaram) will chair the meeting of Financial Stability and Development Council (FSDC) on 31 January,' sources said. The high-level FSDC, which comprises heads of RBI, Sebi, IRDA and PFRDA, coordinates the working of regulators and looks at economic and financial issues.
With most PSU banks reporting a rise in non-performing assets (NPAs), the meeting is likely to focus on recovery of loans, financing of infrastructure projects in oil, power and real estate sectors, sources said. The bad loans of PSU banks rose to Rs 1,43,000 crore as on 31 September 2012 from Rs 1,12,000 crore as on 31 March 2012. The meeting will also review the initiatives taken by the RBI and Sebi for strengthening corporate bond market with a view to help India Inc raise long-term funds in a cost-effective manner. Though India has a very advanced G-sec (government securities) market, corporate bond market is relatively under-developed.
Among other things, issues like slowing growth, persistent inflationary pressures, rising gold imports and growing fiscal and current account deficits will figure during the discussions, they said.
The financial sector regulators likely to attend the meeting include RBI Governor Duvvuri Subbarao, Sebi Chairman U K Sinha, Pension Fund and Regulatory Development Authority (PFRDA) Chairman Yogesh Aggarwal and secretaries in the Finance Ministry. Chidambaram will present the Budget proposals for 2013-14 in the Lok Sabha on 28 February.
‘FINAL RBI GUIDELINES ON NEW BANK LICENCES IN 2 WEEKS’
The Reserve Bank of India will announce new bank licensing guidelines within a fortnight under which four-five licences are likely to be given to private sector entities, Finance Minister of India P Chidambaram said on Wednesday.
‘In two weeks, the Reserve Bank of India will announce the final guidelines for licensing more private sector banks. We expect that four to five licences will be granted,’ he told the Financial Times in an interview on Tuesday. RBI has received comments from various stakeholders on its draft guidelines for licensing more private sector banks and is currently working on final norms. The draft set of guidelines was issued in August 2011. In a separate TV interview, Chidambaram also said no eligible corporate entity should be denied opportunity to enter the banking space.
‘But if the guidelines are made out and transparently spelt out and if a corporate satisfies those guidelines, I don’t see any reason why a corporate should not be given a licence,’ he said. A number of large corporate houses, including Anil Ambani-led Reliance Group, financial conglomerates Religare and Shriram groups, engineering-to-technology major L&T group and Aditya Birla group, are said to be interested in entering the banking business depending on the regulatory framework. Chidambaram further said India has been liberal in granting branches to foreign banks more than what ‘we are required to do under the WTO regulations’.
‘So we have, today, a variety of banks competing with each other foreign banks, Indian private sector banks, public sector banks, cooperative banks which are under the supervision of the State Governments,’ he added.
Currently there are 26 public sector banks, 22 private sector banks and over 40 foreign banks. He also dispelled the impression that public sector banks were an obstacle to financial liberalisation.
'He (Chidambaram) will chair the meeting of Financial Stability and Development Council (FSDC) on 31 January,' sources said. The high-level FSDC, which comprises heads of RBI, Sebi, IRDA and PFRDA, coordinates the working of regulators and looks at economic and financial issues.
With most PSU banks reporting a rise in non-performing assets (NPAs), the meeting is likely to focus on recovery of loans, financing of infrastructure projects in oil, power and real estate sectors, sources said. The bad loans of PSU banks rose to Rs 1,43,000 crore as on 31 September 2012 from Rs 1,12,000 crore as on 31 March 2012. The meeting will also review the initiatives taken by the RBI and Sebi for strengthening corporate bond market with a view to help India Inc raise long-term funds in a cost-effective manner. Though India has a very advanced G-sec (government securities) market, corporate bond market is relatively under-developed.
Among other things, issues like slowing growth, persistent inflationary pressures, rising gold imports and growing fiscal and current account deficits will figure during the discussions, they said.
The financial sector regulators likely to attend the meeting include RBI Governor Duvvuri Subbarao, Sebi Chairman U K Sinha, Pension Fund and Regulatory Development Authority (PFRDA) Chairman Yogesh Aggarwal and secretaries in the Finance Ministry. Chidambaram will present the Budget proposals for 2013-14 in the Lok Sabha on 28 February.
‘FINAL RBI GUIDELINES ON NEW BANK LICENCES IN 2 WEEKS’
The Reserve Bank of India will announce new bank licensing guidelines within a fortnight under which four-five licences are likely to be given to private sector entities, Finance Minister of India P Chidambaram said on Wednesday.
‘In two weeks, the Reserve Bank of India will announce the final guidelines for licensing more private sector banks. We expect that four to five licences will be granted,’ he told the Financial Times in an interview on Tuesday. RBI has received comments from various stakeholders on its draft guidelines for licensing more private sector banks and is currently working on final norms. The draft set of guidelines was issued in August 2011. In a separate TV interview, Chidambaram also said no eligible corporate entity should be denied opportunity to enter the banking space.
‘But if the guidelines are made out and transparently spelt out and if a corporate satisfies those guidelines, I don’t see any reason why a corporate should not be given a licence,’ he said. A number of large corporate houses, including Anil Ambani-led Reliance Group, financial conglomerates Religare and Shriram groups, engineering-to-technology major L&T group and Aditya Birla group, are said to be interested in entering the banking business depending on the regulatory framework. Chidambaram further said India has been liberal in granting branches to foreign banks more than what ‘we are required to do under the WTO regulations’.
‘So we have, today, a variety of banks competing with each other foreign banks, Indian private sector banks, public sector banks, cooperative banks which are under the supervision of the State Governments,’ he added.
Currently there are 26 public sector banks, 22 private sector banks and over 40 foreign banks. He also dispelled the impression that public sector banks were an obstacle to financial liberalisation.
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