Issue: 1286
·
New market timings from Monday; F&O trading extended till
3:40 pm.
·
CBI books Anil Ambani, Reliance Capital in Rs.1,816 crore
EPFO case.
·
Prime Minister Shri Narendra Modi launches ‘Nasha Mukt Yuva
for Viksit Bharat Sankalp Abhiyan’.
·
Union Government releases tax devolution of Rs.1,09,019 crore
to State Governments, as one advance instalment to accelerate their capital and
developmental expenditure.
·
Corporate, personal loans drive 63% of bank credit growth:
SBI research report.
·
Shivalik Small Finance Bank completes merger with ManiBhavnam
Home Finance.
·
UPI hits record Rs 29.9 lakh crore in July, 23.66 billion
transactions.
FIIs end four-month selling
streak with $2.31 billion July buying: After four straight months of selling, foreign
institutional investors (FIIs) turned net buyers in Indian equities in July
despite heightened volatility triggered by renewed Iran tensions and elevated
crude oil prices. Strong participation in primary issuances and a return to
secondary markets helped FIIs record their biggest monthly buying in over a
year. FIIs invested $1.25 billion in the primary equity
market during the month, extending their buying streak in primary issuances to
34 consecutive months. They also infused $1.06 billion into secondary equity
markets, turning net buyers for the first time after four straight months of
selling.
(Moneycontrol)
RBI MPC likely to stay on
hold amid inflation risks, global uncertainty: The Reserve Bank of India’s
Monetary Policy Committee (MPC) is expected to keep the benchmark repo rate
unchanged at 5.25 per cent and retain its “neutral” stance at its August 3-5
meeting, despite rising inflationary pressures stemming from higher crude oil
prices, a weakening rupee, the West Asia conflict and concerns over the impact
of El Nino.The MPC has left the repo rate unchanged in its last three meetings
while maintaining a neutral policy stance for six consecutive meetings. Headline
retail inflation accelerated to 4.4 per cent in June from 3.9 per cent in May,
breaching the RBI’s 4 per cent target for the first time since January 2025 and
touching an 18-month high.
(Business Line)
Cabinet approves 'Samudra
Manthan' - National Offshore Exploration Scheme with an outlay of Rs.84,084
crore: The
Union Cabinet, chaired by Hon’ble Prime Minister Shri Narendra Modi, yesterday
approved “Samudra Manthan” the National Offshore Exploration Scheme, a Central
Sector Scheme of the Ministry of Petroleum & Natural Gas carrying an
approved outlay of Rs.84,084 crore for implementation through FY 2030–31. It is
India’s most ambitious offshore exploration mission to date. This approval
marks the culmination of a series of transformative reforms undertaken under
the leadership of the Hon'ble Prime Minister to strengthen India's hydrocarbon
exploration and production sector.
(PiB)
Index derivatives turnover falls as RBI tightens bank funding to prop traders: The RBI’s tighter funding norms for capital market intermediaries have started reflecting in derivatives trading volumes, with turnover in NSE’s index futures and options segment declining sharply in July. Market participants, however, believe the full impact is yet to play out as a portion of bank funding sanctioned before the new rules kicked in on July 1 continued to support trading activity during the month. Data from NSE showed index futures turnover fell 17 per cent month-on-month to Rs.3.96 lakh crore in July from Rs.4.75 lakh crore in June, while index options premium turnover declined 16 per cent to Rs.9.70 lakh crore from Rs.11.5 lakh crore.
(Business Line)
Govt to introduce Bill to replace 125-year-old law on presenting
bank records as evidence in courts: The government is replacing a
colonial-era law with one that seeks to preserve access to banking evidence
while protecting banks from unnecessary legal proceedings, shifting the
emphasis to better-targeted judicial oversight rather than unrestricted access
to banking records. To this end, Finance Minister Nirmala Sitharaman will
introduce the Bankers’ Books Evidence Bill, 2026 in Parliament on Monday,
replacing the Bankers’ Books Evidence Act, 1891, which has governed the
production of banking records in courts for over 125 years. According
to the List of Business for August 3, the proposed legislation seeks to provide
“for law relating to evidence with respect to bankers’ books and to align it
with contemporary digital banking practices.”
(Business Line)
PSBs seek higher NIM, reprice Rs 1 lakh-cr corp loans in Q1: In pursuit of higher net interest margin, public sector banks (PSBs) repriced or shed more than Rs 1 lakh crore of low-yielding corporate loans in the June quarter. Three big state-run lenders — Bank of Baroda, Punjab National Bank and Canara Bank — have repriced or let go corporate loans amounting to around Rs 80,000 crore owing to low yields, sources said. A stiff competition to attract corporate loans had brought down lending rates to even below 7% for top-rated firms. But the pricing environment has marginally improved, and demand for credit has also increased over time, senior bank officials said.
(Financial Express)
SBI mops up $7.5 billion under RBI swap window: State Bank of India (SBI) has garnered $7.5 billion under the Reserve Bank of India’s three concessional swap schemes, accounting for almost 20% of the total mop-up by banks until July 31. SBI has mobilised $6 billion via FCNR(B) deposits while $1.5 billion has come in through foreign currency bonds, a source said. Some of the public sector banks, including Indian Bank, Canara Bank and Bank of Baroda, have hit the $1-billion mark in FCNR(B) deposits during this period, according to sources.
(Financial Express)
Bank of
Maharashtra cuts home loan rate to 7%, waives processing fee: State-owned Bank of Maharashtra (BoM) has
launched a limited-period "Monsoon Dhamaka" campaign, reducing its
home loan interest rate to 7 per cent per annum while waiving processing fees
and documentation charges to boost retail lending. The bank also lowered its car loan
interest rate to 7.45 per cent per annum, positioning both products among the
lowest-priced offerings in the industry, it said in a statement on Saturday.
(Business Standard)
India approved only one
Chinese FDI proposal in FY26, cleared 13 from Hong Kong: India approved only one foreign direct investment
(FDI) proposal from China worth Rs 1 crore during the 2025-26 financial year,
while clearing 13 proposals from Hong Kong worth Rs 610.42 crore, according to
official data released by the Department for Promotion of Industry and Internal
Trade (DPIIT). The approvals come under the government's Press
Note 3 framework, under which investments from countries sharing a land border
with India require prior government approval. The policy was introduced in
April 2020 to prevent opportunistic takeovers of Indian companies during the
COVID-19 pandemic.
(Moneycontrol)
New Delhi to host “GI &
Beyond 2.0 Summit” on 5 August: To promote India's rich Geographical
Indication (GI) handloom and handicraft products and strengthen their position
in domestic and international markets, the Office of the Development
Commissioner (Handlooms), Ministry of Textiles, Government of India, in association
with the Handloom Export Promotion Council (HEPC), will organise the GI &
Beyond 2.0 Summit? on 5 August 2026 at Dr. Ambedkar International Centre, New
Delhi. The Summit aims to promote India's GI-tagged
handloom and handicraft products and facilitate collaboration among
stakeholders across the GI ecosystem. It will bring together overseas buyers
from about 10 countries, exporters and multinational corporations (MNCs) from
across India, registered proprietors of GI products, officials from Central and
State Government Departments, and experts from leading textile brands, retail
chains, e-commerce platforms, academia and industry.
(PiB)
Gross GST
collections rise 15% in July, led by strong import revenues: Gross and net Goods and Services Tax
(GST) collections rose 15.4 per cent and 15.8 per cent year-on-year (YoY),
respectively, in July, with the increase driven largely by robust revenue from
imports. Domestic GST collections also registered healthy growth. Gross
GST collections stood at Rs.2.11 trillion in July, compared with Rs.1.83
trillion a year ago, while net collections, after adjusting for refunds, rose
to Rs.1.81 trillion from Rs.1.57 trillion, according to government data
released on Saturday. July GST collections reflect economic activity and transactions
undertaken in June. On a sequential basis, gross GST collections increased 8.4
per cent from Rs.1.95 trillion in June to Rs.2.11 trillion in July, while net
GST collections rose 11.6 per cent from Rs.1.62 trillion to Rs.1.81 trillion.
(Business Standard)
Cabinet note in the works
to end forex rule for SEZ services: The Commerce Department is
preparing a Cabinet note to amend the Special Economic Zones (SEZ) Act to allow
SEZ units to receive payments in Indian rupees, instead of foreign exchange,
for services provided to clients in the domestic market, a move expected to
remove a long-standing “anomaly” and unlock significant business opportunities
for companies such as GMR and Larsen & Toubro (L&T). “A range of
sectors, particularly maintenance, repair and overhaul (MRO), engineering,
defence manufacturing and information technology, where SEZ units have been
unable to fully participate in the domestic market because of the foreign
exchange payment requirement, are set to benefit from the proposed amendment,”
an official tracking the development told businessline.
(Business Line)
Centre releases additional
tax devolution of Rs.1.09 trillion to states: The finance ministry on Saturday said the
Centre has released additional instalment of tax devolution to state
governments amounting to Rs 1.09 trillion, which is in addition to the normal
monthly amount. Currently, 41 per cent of taxes collected by the
Centre is devolved in 14 instalments among states during a fiscal year.
(Business Standard)
RBI's special forex swap
window outpaces 2013 inflows in only weeks: The Reserve Bank of India (RBI) on Saturday
said banks had mobilised nearly $41 billion in foreign exchange inflows as of
July 31 under its concessional swap window for fresh [FCNR(B)] deposits,
Overseas Foreign Currency Borrowings (OFCBs) and External Commercial Borrowings
(ECBs). Of the total inflows, $36.7 bn came through FCNR(B) deposits, $2.57 bn
through OFCBs and $1.5 bn through ECBs. The latest mobilisation has already surpassed the
roughly $34 bn raised under the RBI's special FCNR(B) deposit scheme in 2013.
Overall inflows under the current concessional swap window have comfortably
exceeded the 2013 mobilisation in less than two months since the facility was
operationalised.
(Business Standard)
HELICOPTER MONEY Vs QUANTITATIVE EASING
§ ‘Helicopter
Money’. basically means non-repayable money transfer from the central bank to
the government.
§ This
is an unconventional monetary policy tool aimed at bringing a flagging economy
back on track. It involves printing large sums of money and distributing it to
the public. Friedman used the term to signify "unexpectedly dumping money
onto a struggling economy with the intention to shock it out of a deep slump.
“Under such a policy, a central bank "directly increase the money supply
and, via the government, distribute the new cash to the population with the aim
of boosting demand and inflation."
§ Quantitative
easing also involves the use of printed money by central banks to buy
government bonds. But not everyone views the money used in QE as helicopter
money. It sure means printing money to monetise government deficits, but the
govt has to pay back for the assets that the central bank buys.It's not the
same as bond-buying by central banks "in which bank-owned assets are
swapped for new central bank reserves."Helicopter money is also different
from a central bank directly financing the debt of a government.
RBI KEY RATES
Repo
Rate: 5.25%
SDF:
5.00%
MSF
/Bank Rate: 5.50%
CRR:
3.00%
SLR:
18.00%
FOREX RATES (RBI REF. RATE)
INR
/ 1 USD : 95.3706
INR
/ 1 GBP : 128.2779
INR
/ 1 EUR : 109.8189
INR
/100 JPY: 59.4600
EQUITY INDEX
Sensex:
78094.64 (+166.49)
NIFTY:
24383.60 (+66.45)
Bnk NIFTY: 57264.85 (+117.35)
Historical events: 3 August marks
several notable events in history. In 1492, Christopher Columbus set sail from
Spain on his first voyage, which led to the European discovery of the Americas.
In 1914, Germany declared war on France during the opening days of the First
World War. In India, 3 August 2004 saw the formal introduction of the National
Rural Employment Guarantee Bill (later enacted as MGNREGA in 2005) in
Parliament, a landmark step toward guaranteeing rural employment.
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