Issue: 1315
·
Trump threatens to 'stop trading' with some partners unless
Fed lowers rates.
·
Govt tightens e-bus, e-truck localisation norms, sets April
2027 deadline for key components.
·
SEBI begins hearings to recover gains linked to
Adani-Hindenburg trades: Report.
·
SEBI clears NSE IPO, paving way for market debut.
·
India, Belgium set to double bilateral trade from $13 billion
in 5 years.
·
RBI absorbs Rs.6.02 lakh crore via VRRR as banking liquidity
hits record high.
RBI moves to longer cash drain
as India liquidity surges: India’s central bank will lock up excess banking
cash for longer, stepping up efforts to manage a record liquidity glut fueled
by its drive to attract dollars from overseas Indians. The Reserve Bank of
India will hold a 7 trillion rupee ($74.1 billion), 30-day variable-rate
reverse repo auction on Monday, it said in a statement. The longer tenor marks a
shift from recent operations of up to 15 days and will allow the RBI to keep
excess cash out of the banking system for an extended period. The tool is less
forceful than some alternatives because banks choose how much money they want
to park with the central bank. India’s banking system is awash with a record
10.5 trillion rupees of excess cash, according to a Bloomberg Economics index,
after the central bank exchanged dollars raised by banks from overseas Indians
for rupees. “Participants will have an option for premature reversal of the
amount lent in the above auction,” the release added.
(Moneycontrol)
World’s biggest sovereign
wealth fund mulls slashing US Treasury holdings: Norway’s $2.3 trillion
sovereign wealth fund has proposed reducing its allocation to government bonds,
with US Treasuries likely to bear the biggest cut, as it seeks to diversify its
fixed-income portfolio and boost returns. Norges Bank Investment
Management (NBIM), which manages the fund has recommended reducing the share of
government bonds in its benchmark bond index from 70% to 50%, Bloomberg
reported. The fund, which is the largest
sovereign wealth fund in the world, said a 50% government bond allocation would
still provide sufficient liquidity during periods of market turbulence, while
allowing it to seek higher returns from other fixed-income assets.
(Moneycontrol)
GDP methodology: MoSPI says
negative manufacturing deflator does not mean factory-gate prices fell: The Ministry of Statistics and
Programme Implementation (MoSPI) has sought to address concerns over the newly
released GDP estimates, saying a negative implicit deflator for manufacturing
does not mean that manufacturing prices declined and that revisions to last
year’s GDP were not aimed at mechanically boosting the latest growth rate. In a
set of questions and answers released on Wednesday, the ministry explained the
impact of the new double-deflation methodology, the revisions to the GDP series
and the differences between the GDP deflator, consumer price inflation and
wholesale price inflation. The clarification comes days
after MoSPI released the updated annual and quarterly GDP estimates with
2022-23 as the base year. The revised series incorporates the new Producer
Price Index (PPI), Banking Services Price Index and updated administrative data.
(Business Line)
80% of FCNR (B) inflows
came via the leverage route: According to bankers’
estimates, about 80 per cent of the total $127.23 billion mobilised by
Non-Resident Indians (NRIs) under the special Foreign Currency Non-Resident
(Bank) FCNR(B) deposits offered by banks through the RBI’s limited-period
concessional swap facility came through the leverage route, while more than
two-thirds of the deposits were parked in the five-year tenor. Inflows into the
special FCNR(B) deposit scheme were robust during the 85-day period from June 8
to August 31, 2026, as high interest rates of 6-7.5 per cent offered by banks
attracted NRIs.
(Business Line)
HDFC Bank, Ujjivan SFB
start CEO search amid leadership changes in private banks: HDFC Bank and Ujjivan Small
Finance Bank have begun scouting for suitable candidates to be appointed as
their new MD and CEO to drive next phase of growth. Kotak Mahindra Bank and
Fino Payments Bank are reportedly at the advanced stage of appointment process. As
per the process, the board of a bank shortlists couple of names for top
executive position. Once finalised, the shortlisted names are sent to Reserve
Bank of India (RBI) for its approval. RBI after thorough examination gives its
nod.
(Business Line)
Insurer can't reject claim
if alcohol habit disclosed before policy purchase: Consumer commission: A consumer commission ordered
Edelweiss Tokio Life Insurance to pay over fifty lakh rupees. The company
rejected a widow's claim despite disclosed alcohol consumption by her husband.
Hypertension and diabetes were also noted as lifestyle diseases by the
commission. The insurer was found guilty of deficiency in service for rejecting
the claim. The widow will receive the claim amount, interest, and compensation
for harassment.
(Economic Times)
HDFC, Kotak CEO departures
put succession planning at India’s private banks under scrutiny: Recent unexpected leadership
changes at top Indian private banks raise succession planning concerns.
Investors question long-term business strategy continuity amid these abrupt
departures. HDFC Bank and Kotak Mahindra Bank face leadership transitions,
surprising many analysts. Stricter regulations and competition from fintech
also affect talent retention. Improved succession visibility will help maintain
investor confidence in strategic direction.
(Economic Times)
NFRA sets up advisory panel
on audit quality, AI and technology risks: The National Financial
Reporting Authority (NFRA) on Friday constituted an advisory committee on
'audit quality, assurance and technology' to look into the risks and practical
implementation issues arising from the use of data analytics, automation, artificial
intelligence and machine learning in the conduct of audits among various other
audit quality related matters. This is the third such
Committee set up by NFRA, the first being the Technical Advisory Committee,
which was constituted in 2020 and whose term ended in December 2022.
(Business Standard)
Sebi, ESMA sign MoU to
deepen regulatory cooperation on clearing houses: The Securities and Exchange
Board of India (Sebi) and the European Securities and Markets Authority (ESMA)
on Friday signed a memorandum of understanding (MoU) to strengthen cooperation
and exchange of information relating to central counterparties (CCPs) regulated
and supervised by Sebi. The pact replaces an earlier
MoU between the two regulators signed on June 21, 2017. It establishes a
framework for cooperation between Sebi and ESMA in accordance with their
respective laws and regulations, including enabling ESMA to rely on Sebi’s
regulatory and supervisory activities.
(Business Standard)
Govt urges industry to lead
Rs.60K cr PM-SETU initiative to drive energy, industrial transformation: The government has urged industry to take a leading
role in transforming the country’s skilling landscape through the ambitious Rs.60,000
crore PM-SETU initiative to drive India's energy and industrial transformation.
The Pradhan Mantri Skilling and Employability Transformation through Upgraded
ITIs (PM-SETU) scheme envisages enhancing the overall quality and relevance of
vocational training with upgraded labs, machines and industry-aligned
curriculum in the country.
(Business Line)
Fin Min notifies norms
allowing e-commerce firms to maintain inventory only for exports: The Department of Economic Affairs under the
finance ministry has notified changes in Foreign Direct Investment (FDI) norms
to allow e-commerce firms to maintain inventory only for export purposes. These
firms will have to export goods manufactured or produced in India. Also, FDI in
inventory-based e-commerce retailing has not been permitted. The department in
a September 2 notification has added a provision in this regard in the Foreign
Exchange Management (Non-debt Instruments) Rules, 2019.
(Business Line)
Company formation slows in
first quarter of FY27: The number of new companies registered in the first
quarter of FY27 remained high, but the pace of growth slowed sharply from the
previous quarter. Data from the Ministry of Corporate Affairs (MCA) showed that
62,986 companies were registered during April-June 2026, up 3% from 61,139 in
the same period a year earlier. However, registrations were 9.7% lower than the
69,772 companies registered in January-March 2026, the highest quarterly figure
on record. Despite the sequential decline, the latest quarter was the
second-highest in the series. The slowdown was also pronounced compared with
the previous quarter, when company registrations had risen 25.5% YoY.
(Financial Express)
States’ capex growth halves
in April-July:
States’ aggregate
capital expenditure (capex) likely grew at half the pace in April–July of the
current financial year compared with the year-ago period, partly due to a
monsoon-induced slowdown. Going by the finances of 20 large states reviewed by
FE, their capex during April-July 2026-27 rose 10.7% year-on-year to Rs 1.79
lakh crore, compared with 21.8% growth in the same period of 2025-26. The
moderation could also partly stem from only four tranches of tax devolution
being shared with the states in April-July 2027, compared with five in the
year-ago period. However, stronger tax revenue growth and lower borrowings,
coupled with likely front-loading of tax devolution in the coming months, could
give states the fiscal space to accelerate capex in the remaining months of
FY27.
(Financial Express)
Eway bills rise 7.7% to
139.08 mn in August, third highest on record: Eway bill generation rose 7.7 per cent
year-on-year (Y-o-Y) to 139.08 million in August, the third-highest monthly
count on record, signalling sustained momentum in goods movement and formal
economic activity. An eway bill is an electronically generated
document required under the goods and services tax (GST) regime for movement of
goods valued at more than Rs.50,000, subject to specified conditions and
exceptions. The August figure was 9.95 million higher than the 129.13 million
eway bills generated in August 2025. Sequentially, however, generation declined
marginally by 0.51 per cent from 139.79 million in July, the second-highest
monthly count on record.
(Business Standard)
Odisha plans integrated
university township with industry focus: Odisha is working on an ambitious plan to
establish an integrated university township that will bring higher education,
research, skill development and innovation under one roof. The state has
identified several regions for detailed examination and giving in-principle
approval to a framework that envisages industry-led campuses, mining-focused
universities and shared infrastructure. The proposed integrated university
township is part of the Centre’s university townships plan announced during
Union Budget 2026-27.
(Business Standard)
DEPOSIT BETA
·
Deposit beta measures how much
of a change in the policy rate is passed on to the interest rates paid by banks
on deposits. For example, if the RBI raises the repo rate by 100 basis points
and a bank increases its average deposit rate by 60 basis points, the deposit
beta is 60%.
·
A higher deposit beta raises
the bank’s cost of funds and may compress its Net Interest Margin (NIM). It has
become particularly important amid intense competition for deposits.
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 : 94.4914
INR
/ 1 GBP : 127.9703
INR
/ 1 EUR : 109.8822
INR
/100 JPY: 60.5200
EQUITY INDEX
Sensex:
76515.43 (+362.57)
NIFTY:
23897.70 (+24.25)
Bnk NIFTY: 57369.65 (-10.95)
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