Issue: 1228
· Sebi explores tokenisation of
corporate bonds for faster settlements.
· Slice Small Finance Bank
posts first-ever Rs.48.4 crore net profit in FY26.
· MobiKwik gets RBI nod for
offline payment aggregator licence expansion.
· Rupee falls after three-day
rally amid spike in crude oil prices.
· Union Bank approves Rs.8,000
crore capital raise through debt, equity mix.
· China expands overseas travel
curbs to top AI professionals at pvt firms.
· RBI’s $5 billion dollar-rupee
swap auction on 26 May received bids worth $9.8 billion, showing strong demand
from banks and investors.
New IIP series to track
debit cards, CCTV cameras, stents and vaccines as govt updates industrial
basket: India’s
new industrial production numbers will track newer industrial products such as
magnetic stripe cards including debit and credit cards, CCTV cameras, non-woven
textile articles, aircraft and spacecraft parts, stents and vaccines, as the
government updates the country’s factory output gauge to better reflect changes
in the economy. The Ministry of Statistics and
Programme Implementation is revising the base year of the Index of Industrial
Production from 2011-12 to 2022-23, with the new series planned for release on
June 1. The government is adding 120 new item groups to the series, while
64 will be dropped.
(Moneycontrol)
India, US sign critical
minerals framework to deepen cooperation; protect against `coercive practices’: India and the US, on Tuesday,
signed a bilateral critical minerals framework to deepen cooperation across the
critical minerals and rare earths supply chain protecting it from “coercive
market practices” amid Chinese restrictions disrupting supplies. “Through this
framework, the United States and India will engage in international efforts to
protect sensitive supply chains from coercive market practices and reduce our
collective vulnerability to single-source monopolies,” per a statement issued
by the US Embassy in India.
(Business Line)
Fuel price hikes may push
retail inflation to 5% by June, say economists: Fuel price hikes and higher
import duties on gold and silver could push retail inflation to 5 per cent by
June, but the RBI will wait and watch till the impact of fuel price hike settles
in before tightening interest rates in the second half of the fiscal year,
economists said.Over a period of 11 days, starting May 15, petrol prices have
been increased by Rs 7.38/ltr and diesel prices by Rs 7.48/ltr with some
inter-city variation. These price hikes will directly cascade into impacting
prices in sectors where petrol and diesel are used as inputs such as transport
and storage and to some extent electricity..
(Business Line)
India sees 15% jump in
education loans, touches decade-high Rs.8.58 lakh crore in FY26: Rising tuition fees, growing
overseas education aspirations, and wider lender participation pushed education
loans from banks to their sharpest annual growth in a decade in FY26. Outstanding
education loans from banks rose nearly 15 per cent year-on-year to Rs.8.58 lakh
crore in FY26 from Rs.7.46 lakh crore in FY25, according to data from Reserve
Bank of India’s latest bulletin. The loan book had contracted in FY22 and FY23
before recovering in the last two fiscals.
(Business Line)
Insurance CEO pay tied to
customer outcomes, transparency under revised IRDAI norms: Poor returns on life insurance
savings products or delays in settling claims and grievances in health and
motor insurance could now directly hit the pay packets of top insurance
executives. The insurance regulator has
mandated that at least 50% of the variable pay and incentives of key managerial
personnel (KMPs) at insurance companies be tied to parameters such as product
performance, claim responsiveness, grievance redressal and policy persistence
from FY27. Under the revised framework, six broad parameters including overall
financial soundness, product performance, claim responsiveness, grievance
redressal, implementation of Indian Accounting Standards, and removal of “dark
patterns” in customer interactions will together carry a 50% weightage in the
assessment of performance-linked pay and incentives for KMPs. Of this,
accounting standards implementation and dark pattern removal will carry a 10%
weightage each, while the remaining 30% weightage will be determined by the
board.
(Financial Express)
ATM cash loaders demand
more money to cover increasing expenses: Cash logistics firms are
urging banks for higher ATM replenishment fees due to escalating operational
costs. Soaring fuel prices and increased minimum wages are pushing expenses up
by an estimated 15-20%. A surge in replenishment trips, driven by demand-supply
gaps, further inflates fuel expenses. The industry is exploring ways to
optimize trips to manage these rising costs.
(Economic Times)
Banks seek RBI guidance as
multiple nominations create claim settlement hurdles: Banks are facing difficulties
settling claims when multiple people are nominated on accounts. This is causing
operational problems for financial institutions. They are now seeking guidance
from the Reserve Bank of India. Existing rules allow up to four nominees.
Issues arise when nominees do not claim jointly. Courts have also added to the
confusion with differing judgments.
(Economic Times)
ICICI Bank adds most credit
cards in April amid rising competition: ICICI Bank added the highest
number of new credit cards among India's top five issuers in April, signalling
intensifying competition for cardholder market share, Reserve Bank of India
data showed. ICICI Bank recorded 151,823 net new issuances, while SBI Cards
came in second with 138,990 additions and HDFC Bank recovered strongly with
128,525 additions.
(Economic Times)
Coal India OFS opens May
27; government plans sale of up to 2% stake: The Government of India will divest up to a 2%
stake in Coal India Limited (CIL) through an Offer for Sale (OFS) scheduled
over May 27 and May 29, according to a stock exchange filing by the state-owned
mining company on Tuesday. The government has fixed the floor price at Rs.412
per equity share, nearly 10% lower than Coal India’s closing price of Rs.455.90
on the NSE, offering investors an opportunity to buy shares at a discount. Under the proposed OFS,
the government plans to sell 6.16 crore equity shares, representing 1% of Coal
India’s total paid-up equity capital, as the base issue size. It has also
retained a greenshoe option to sell an additional 6.16 crore shares in case of
oversubscription. If fully exercised, the total offer size will increase to
12.32 crore shares, equivalent to a 2% stake sale.
(Business Today)
QUAD to mobilise $ 20
billion for critical minerals: The informal strategic alliance of US, India,
Japan and Australia on Tuesday announced its intention to mobilise $ 20 billion
through government and private sector for development of secure critical
mineral supply chains.The meeting of the foreign minister of Quadrilateral
Security Dialogue or Quad partners launched the Critical Minerals Initiative
that plans to use economic policy tools and coordinated investment to
accelerate the development of diversified and fair critical mineral markets.
(Financial Express)
Credit guarantee scheme:
Loan limit for large MFIs increased to Rs.1K crore: NCGTC has revised the loan limit for large
microfinance institutions (MFIs) — those with assets under management (AUM) of Rs.2,000
crore and above — under its credit guarantee scheme to Rs.1,000 crore from the Rs.300
crore notified in March. The Credit Guarantee Scheme for Microfinance
Institutions 2.0 (CGSMFI 2.0) was announced in March to provide guarantee cover
to commercial banks and all-India financial institutions for loans extended to
non-banking financial company microfinance institutions (NBFC-MFIs) and other
MFIs, for on-lending to existing or new small borrowers. Under the scheme,
loans of up to Rs.20,000 crore were to be guaranteed by NCGTC.
(Business Standard)
SEBI eyes equity-style
norms for debt, to pilot tokenised bond market: SEBI is reviewing whether
listed debt ?securities should be subject to disclosure ?requirements on par
with ?those for listed equities, its ?chief said at an event on
Tuesday, as it also ?moves ahead with plans to pilot tokenisation of corporate ?bonds
to modernise the market.Securities ?and Exchange Board of India
(SEBI) is reviewing whether listed debt should have disclosure ?norms similar ?to
listed equity to enhance transparency and investor protection in debt markets,
chairman Tuhin Kanta ?Pandey said.
(Business Line)
IBC 2.0 takes
effect as MCA notifies major insolvency reforms: The Ministry of Corporate Affairs (MCA)
has notified May 26 as the appointed date for bringing into force 57 clauses,
along with parts of four other clauses, of the Insolvency and Bankruptcy Code
(Amendment) Act, 2026, marking the formal rollout of “IBC 2.0”. The
operationalised provisions include creditor-led resolution mechanisms, an
overhaul of the liquidation process, stricter timelines and measures aimed at
reducing delays in insolvency proceedings. The Amendment Act was notified on April 6
after Parliament passed the legislation during the Budget Session,
incorporating all 11 recommendations of the Select Committee along with an
additional government amendment mandating the Committee of Creditors (CoC) to
formally record reasons for selecting the successful resolution applicant. First,
the amendments are about speed and certainty. Second, they introduce a major
structural shift through the new creditor-initiated insolvency resolution
process, where debtors remain in possession while creditors remain in control,
similar to frameworks followed in several foreign jurisdictions. Third, the
amendments firmly place creditors in the driver’s seat while cleaning up grey
areas in the law,” he said.
(Business Line)
GREENSHOE OPTION
·
A
greenshoe option (or over-allotment option) is a legal clause in an initial
public offering (IPO) underwriting agreement. It allows underwriters to sell up
to 15% more shares than originally planned if investor demand exceeds
expectations. This mechanism provides price stability by helping underwriters
smooth out extreme price fluctuations in the secondary market.
·
The lead underwriter sells
more shares to the public than the issuing company initially authorized,
borrowing these extra shares from major existing shareholders (promoters).
·
If the stock price drops below
the IPO offer price: The underwriter buys back the extra shares in the open
market to fulfill their promise to return the borrowed shares. This creates
artificial demand, preventing the stock from crashing.
· If
the stock price rises above the IPO offer price: The underwriter exercises the
greenshoe option, purchasing the new shares directly from the issuing company
at the original offering price to cover the borrowed shares.
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 : 95.4437
INR
/ 1 GBP : 128.6416
INR
/ 1 EUR : 111.0507
INR
/100 JPY: 60.6000
EQUITY INDEX
Sensex:
76009.70 (-479.26)
NIFTY:
23913.70 (-118.00)
Bnk NIFTY: 55092.90 (-200.75)
Historical
events: On May 27, 1964,
India mourned the loss of its first Prime Minister, Jawaharlal Nehru. Globally,
May 27 is marked by milestones like Tsar Peter the Great founding Saint
Petersburg in 1703, the British Navy sinking the German battleship Bismarck in
1941, and the inauguration of the Golden Gate Bridge in 1937.
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