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Banking

LTV

15th August – Loan to value (LTV) ratio

Loan to value (LTV) ratio Recently, while the Monetary Policy Committee kept the policy rates unchanged, the RBI brought about other significant changes to help borrowers with additional liquidity. One such move was the increase in the permissible loan-to-value (LTV) ratio for loans sanctioned by banks against the pledge of gold ornaments and jewellery for …

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SARFAESI Act

15th May – SARFAESI Act

SARFAESI The Supreme Court recently held that the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) will be applicable to cooperative banks, and not just commercial banks. This has been whole-heartedly welcomed by co-operative banks. What is SARFAESI Act? The SARFAESI Act was passed on …

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counter-cyclical capital buffer

11th April – Counter-cyclical Capital Buffer

Counter-cyclical Capital Buffer What is Counter-cyclical Capital Buffer? Following Basel-III norms, central banks specify certain capital adequacy norms for banks in a country. The CCCB is a part of such norms and is calculated as a fixed percentage of a bank’s risk-weighted loan book. How is it different from capital adequacy ratios? One key respect …

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6th February – Deposit Insurance in India

In News – The government, in the Union Budget tabled on Saturday, proposed to increase the insurance cover on bank deposits from Rs 1 lakh to Rs 5 lakh. In September 2019, the Reserve Bank of India (RBI) slapped curbs on Punjab and Maharashtra Cooperative Bank Ltd (PMC Bank), a leading cooperative bank headquartered in Mumbai with deposits …

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31st December – Indian Banking – Challenges

The Reserve Bank of India (RBI) is planning to conduct the second phase of Operation Twist by simultaneous buying and selling of government securities. What it means? It will buy long tenure bonds and sell short-term ones to bring down the bond yields and flatten the curve, narrowing the term premium. The 10-year bond yield, …

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