Issue: 1219
· PSBs witnessed a sharp fall
in Liquidity Coverage Ratios due to strong credit demand and rising competition
for deposits.
· The Government of India
approved Emirates NBD’s proposed $3 billion majority stake acquisition in RBL
Bank.
· Analysts warned that the
latest petrol and diesel price hike could increase inflation by 10–25 basis
points and may force the RBI to reassess inflation projections.
· Indian bond yields eased
after reports emerged that the government may cut taxes on foreign bond
investments.
· Home loan pricing pressure
continued to squeeze profitability for several mid-sized private banks.
China, US agree to
implement ‘all’ previous trade agreements after Xi-Trump summit: China and the United States
agreed to continue implementing "all" agreements previously reached
and to establish councils for trade and investment, Beijing's top diplomat said
in a statement on Friday. US President Donald Trump (R)
speaks with China's President Xi Jinping as he leaves after a visit to
Zhongnanhai Garden in Beijing on May 15, 2026. (Photo by Evan Vucci / POOL /
AFP. China and the United States agreed to continue implementing
"all" agreements previously reached and to establish councils for
trade and investment, Beijing's top diplomat said in a statement on Friday.
(Moneycontrol)
India's forex reserves jump
by $6.295 billion to $696.988 billion: India's forex reserves jumped
by $6.295 billion to $696.988 billion during the week ended May 8, the Reserve
Bank said on Friday. The overall reserves had
dropped by $7.794 billion to $690.693 billion in the previous reporting week. The
forex kitty had expanded to an all-time high of $728.494 billion during the
week ended February 27 this year, before the onset of the West Asia crisis,
which led to several weeks of drop, as the rupee came under pressure and RBI
had to intervene in the forex market through dollar sales.
(Moneycontrol)
Govt imposes windfall tax
on petrol exports; cuts duty on diesel, aviation turbine fuel: The government on Friday
imposed a windfall gains tax of Rs 3 per litre on petrol exports, while
reducing the levy on diesel exports to Rs 16.5 per litre and aviation turbine
fuel (ATF) exports to Rs 16 per litre with effect from May 16. In
a notification, the Finance Ministry said the road and infrastructure cess on
exports of petrol and diesel will remain nil. There is no change in the
existing duty rates on petrol and diesel cleared for domestic consumption. The
special additional excise duty (SAED) on petrol exports at Rs 3 per litre has
been imposed for the first time since the start of the West Asia crisis.
(Moneycontrol)
Emirates NBD gets Centre’s
nod to acquire majority stake in RBL Bank: Dubai-headquartered banking
major Emirates NBD has secured approval from the Centre to move ahead with its
investment and acquire stake in RBL Bank, according to a stock exchange
disclosure released on Friday. The Middle East banking giant
is looking to pick up as much as a 74% holding in RBL Bank. In April this
year, the bank had already obtained clearance from RBI, which permitted
the proposed acquisition of up to 74% of RBL’s paid-up equity capital through a
letter issued on April 1. In its regulatory filing, RBL
Bank said Emirates NBD informed the lender on May 15, 2026, that it had
received communication from Union Ministry of Finance's Department of Financial
Services, dated May 14, granting approval for the investor to raise its
shareholding beyond 49% and up to 74% in the bank.
(Moneycontrol)
PSBs tap liquidity buffer
to meet strong loan demand: Public sector banks in India
are seeing their liquidity coverage ratios decline. This trend is driven by
strong loan demand outpacing retail deposit growth. Banks are using their
excess liquidity to fund loans. This situation is expected to improve with new
regulatory norms starting in Q1 FY27. The changes will impact how certain
business accounts are treated for liquidity calculations.
(Economic Times)
RBI imposes penalty on IIFL
Finance: The
Reserve Bank of India has fined IIFL Finance Rs 3.1 lakh for not returning
surplus amounts from gold auctions to borrowers. Appnit Technologies faces a Rs
5.8 lakh penalty for KYC and PPI rule violations. These actions stem from
regulatory compliance deficiencies identified during inspections. The RBI's
move highlights its commitment to enforcing financial regulations.
(Economic Times)
Better
recoveries, low slippages pull down PSU banks write-offs to multi-year lows in
FY26:
Loan
write-offs by public sector banks declined to multi-year lows in the fiscal
year 2025-26 on the back of lower slippages and better recoveries. As
per an analysis of bank earnings by PTI, most banks including Bank of Baroda,
Union Bank of India, Punjab National Bank, Central Bank of India, Indian
Overseas Bank, and Indian Bank had write-offs which were the lowest in up to
eight years. Bank of Baroda reported Rs 6,330 crore
write-offs in FY26, lowest since FY18, Bank of India reported Rs 5,735 crore
write-off lowest since FY16, and Indian Bank reported Rs 6,695 crore write-off
lowest since FY19, while Indian Overseas Bank's write-off stood at Rs 1,189
crore in FY26, which was also a multi-year low.
(Economic Times)
Fuel prices hiked after
4 years; OMC losses persist: Petrol and diesel prices increased by Rs.3 per
litre each on Friday — the first hike in more than four years — as state-run
oil marketing companies (OMCs) passed on part of the burden from elevated crude
oil prices triggered by the prolonged West Asia conflict, though analysts said
the hike remains insufficient to fully offset mounting losses. The latest
increase pushed petrol prices in Delhi to Rs.97.77 per litre from Rs.94.77
earlier, while diesel prices rose to Rs.90.67 per litre from Rs.87.67. CNG
prices were also increased by Rs.2 per kg in major cities, taking rates in
Delhi to Rs.79.09 per kg and Mumbai to Rs.84 per kg.
(Financial Express)
Automakers say PM’s EV push
can help grow penetration: Automobile manufacturers have welcomed Prime
Minister Narendra Modi’s renewed push for electric vehicles (EVs), saying the
transition to cleaner mobility is critical not only for sustainability but also
for strengthening India’s energy security by cutting dependence on costly crude
oil imports. Industry executives said the Prime Minister’s appeal to citizens
to reduce petrol and diesel consumption, use public transport, carpool and
adopt EVs could accelerate consumer awareness and support the sector’s
long-term growth plans centred around localisation and innovation.
(Business Line)
Adanis agree to pay $18
million to settle SEC case linked to Adani Green bond offering: Gautam Adani and Sagar Adani have agreed to
pay civil penalties of $6 million and $12 million, respectively, to settle
charges brought by the US Securities and Exchange Commission over alleged
misleading disclosures linked to a 2021 bond offering by Adani Green Energy. In
a litigation release issued on Thursday, the SEC said it had moved for entry of
final judgments by consent against the two executives in the US District Court
for the Eastern District of New York. The proposed settlements are subject to court
approval.
(Business Line)
SEBI eases PAN onboarding
norms for FPIs amid concerns over new tax rules: SEBI has said the Central
Board of Direct Taxes (CBDT) has issued clarifications to address difficulties
faced by foreign portfolio investors (FPIs) in obtaining PAN under the newly notified
Income-tax Rules, 2026. CBDT had
notified the Income-tax Rules, 2026 and related PAN application forms on March
20, 2026. The revised forms introduced additional fields such as Taxpayer
Identification Number (TIN) and details of Representative Assessee (RA) or
Authorised Representative (AR), while some previously optional fields,
including mobile numbers, were made mandatoryFurther, if the PAN, Aadhaar or
passport details of the AS are unavailable, FPIs may furnish their registration
number. In jurisdictions where TIN is not applicable, applicants can fill the
field with “0000000000”.
(Business Today)
SEBI eases InvIT
norms on borrowings, SPV classification after project completion: SEBI on Thursday allowed greater
flexibility in the use of borrowings by InvITs and eased norms for SPVs after
the completion or termination of concession agreements. The regulator widened
the permissible use of borrowings for InvITs where net borrowings exceed 49 per
cent of the value of assets, aimed at enhancing asset performance or expanding
capacity. SEBI has permitted the use of such borrowings to improve asset
performance or augment capacity, major maintenance expenses for road projects,
and refinancing existing debt, subject to conditions. In a separate circular, SEBI eased norms
for SPVs holding infrastructure projects whose concession agreements have ended
or been terminated. Such SPVs will continue to retain their classification as
SPVs provided the InvIT either exits the investment or acquires a new
infrastructure project in the SPV within one year. The one-year timeline will
start after the later of project completion, conclusion of pending litigations
or tax assessments, or completion of the defect liability period.
(Business Line)
PFRDA allows exit from
annuity under NPS in certain cases: PFRDA has relaxed annuity exit
rules, allowing subscribers of the National Pension System (NPS) to surrender
annuity policies in certain special situations. According to the revised
norms, now some of the NPS subscribers will be allowed to surrender their
annuity policies in some cases, especially in case of critical illness. If
the subscriber or any member of their family suffers from a critical illness,
the annuity can be surrendered. However, such a request is subject to
assessment and approval by the Annuity Service Provider (ASP) as per its
internal policy and process.
(Financial Express)
SOFT CURRENCY
§
Soft currency is a currency which is hyper sensitive
and fluctuates frequently. Such currencies react very sharply to the political
or the economic situation of a country.
§
It is also known as weak currency due to its
unstable nature. Such currencies mostly exist in developing countries with
relatively unstable governments. Soft currencies cause high volatility in
exchange rates as well, making them undesirable by foreign exchange dealers.
These currencies are the least preferred for international trade or holding
reserves.
§
Zimbabwean dollar is a classic example of soft
currency.
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 : 95.9255
INR
/ 1 GBP : 128.0912
INR
/ 1 EUR : 111.6336
INR
/100 JPY: 60.5400
EQUITY INDEX
Sensex:
75237.99 (-160.73)
NIFTY:
23643.50 (-46.10)
Bnk NIFTY: 53710.35 (-418.60)
International Day
of Light: May 16 is
officially recognized worldwide as the International Day of Light by UNESCO to
honor the anniversary of the first successful laser operation. Depending on the
region and context, it is also celebrated for several other global and local
observances.
Historical
events: May 16 holds
profound significance in Indian and global history, most notably marked by
Sikkim becoming India's 22nd state in 1975 and Japanese mountaineer Junko Tabei
making history as the first woman to conquer Mount Everest.
****Have a nice Day****
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