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Created on Sunday, 27 March 2016 07:19
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Sunset of 5-star flying (Edited Image Courtesy-KFA ar032009)
“There is a ten-year history behind these loans and the repayments have not yet begun and the interest, also is not being paid. Therefore, the Government is considering steps to see how best to get back these amounts.”
That was Late N. Sanjiva Reddy, Minister of Steel and Mines, replying to questions put by Atal Bihari Vajpayee on the overdue loans taken by TISCO (now Tata Steel) and IISCO (later merged with SAIL) in Parliament. This happened on 17th September 1964 when the deceptive term - non-performing asset (NPA) – did not exist in the banking jargon.
To Mr. Vajpayee's query as to whether “the Government is being pressurised by these companies and that they want that these loans should not be recovered fully from them,” Mr. Reddy answered: “I can assure the hon. Member that the Government would not surrender, whatever may be the amount of pressure put on them.”
Another veteran MP Bhupesh Gupta interjected: “We have heard that earlier also.”
An Aam Aadmi would today react in an identical manner to Finance Minister Arun Jaitley’s recent, pep talk on NPAs especially on Vijay Mallaya-promoted Kingfisher Airlines (KFA) loans.
The other day Mr. Jaitley claimed that the banks are going to recover “every penny” of money lent to Mr. Mallya. This goal is impossible to attain as we elaborate in this column.
Like late Bhupesh Gupta, three generations of Indians have been taken for a ride by successive Governments on corporate lending against inadequate securities and resulting NPAs & tax arrears.
Read more: Mallyagate Should Trigger Probe into NPAs & Tax Arrears as Nehru Legacy
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Created on Tuesday, 22 December 2015 15:56
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(Image Courtesy: FTAF)
Every global crisis serves as an opportunity for international governance bodies to reinvent or revamp their respective regulatory framework. Paris-based anti-money laundering (AML) authority Financial Action Task Force (FATF) is the latest case in point.
FTAF is currently revisiting its AML and counter financing of terrorism (CFT) regulatory guidelines in the wake of growing terror incidents sponsored by Islamic State in Iraq and the Levant (ISIL) in the West.
FTAF is now firing all cylinders on CFT front after ISIL-linked Paris terror attack in November 2015 and subsequent mass shooting in California by couple of Pakistan origin.
FTAF says it is determined to “contribute to efforts to degrade and ultimately defeat ISIL as a terrorist organisation.”
Read more: FATF gets into war mode to Counter Financing of Terrorism
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Created on Wednesday, 06 May 2015 07:34
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(Edited Image Courtesy:PIB)
“As managing director and CEO since 2009, she has brought India’s largest private bank a global vision and impressive returns, while also reaching out to the nation’s masses with branches in remote villages where banks simply didn’t exist.”
This is how Mr. Anshu Jain, Co-CEO of Deutsche Bank, profiled ICICI Bank CEO Ms. Chanda Kochhar, in the Time Magazine, which included her in its annual list of the World's 100 most influential people released on 16th April, 2015.
Mr. Jain's perception has to be taken with a pinch of salt. It should be read along the disclosures contained in three different reports tabled in Parliament, the latest one of which was presented on 27th April 2015.
The latest one from Public Accounts Committee (PAC) revealed ICICI Bank has paid Rs 54.80-crore penal interest on Rs 164.60 crore that the latter wrongly took from the Government under a farm loan waiver scheme. It was implemented by UPA regime during two-year period ending 30th June 2010.
Read more: ICICI Bank pays Rs 219.4-crore to Govt due to CAG-PAC’s vigil
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Created on Wednesday, 04 March 2015 17:02
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(Edited image courtesy- rsby.gov.in)
The Finance Minister Arun Jaitley’s announcement of three insurance schemes for the poor is a classical case of old wine in new bottle. It is pertinently more a case of oversight of plethora of existing schemes and similar announcements made by his predecessors including two stalwarts from Atal Bihari Vajpayee Government.
Instead of consolidating diverse social security schemes, Mr. Jaitley added three more to the existing basket of social security schemes.
One can group Government-funded Social security insurance schemes into three categories – health insurance, life insurance and pension insurance.
As many as 10 statutory insurance schemes from each of these categories are already operating under the Unorganised Workers’ Social Security Act 2008. These include Rashtriya Swasthya Bima Yojana (RSBY), Aam Aadmi Bima Yojna (AABY), National Family Benefit Scheme and Indira Gandhi National Old Age Pension Scheme (IGNOAPS).
The flagship scheme RSBY has ironically got a raw deal in the 2015-16 Budget through name change as well as massive cut in funds allocation.
Moreover, in his anxiety to play the social welfare card to outwit UPA, Mr. Jaitley overlooked the urgency for the much-delayed bank and non-banking deposit insurance reforms. These are urgently needed to shore up public savings and to strengthen the stability of the non-performing assets-strained financial system.
Read more: Indian Budget’s ‘Jan Dhan to Jan Suraksha’ initiative is much ado about nothing
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