RBI on 08.04.2019 notified new minimum standard for setting up new currency chests as per recommendations of Currency Movement Committee. The Currency Movement Committee headed by Shri. D. K. Mohanty had recommended Reserve Bank that it should encourage banks to open large Currency Chests (CCs) with modern facilities and Chest Balance Limit (CBL) of at…
Reserve Bank of India (RBI) in its press release announced that it has learnt merger of Lakshmi Vilas Bank (LVB) and Indiabulls Housing Finance Limited (IBHFL)through media. As per media news above entities have made a merger announcement on April 5, 2019 with approval of their respective Boards. RBI’s disclaimer said that a section of…
Under section 6 Married Women’s Property (MWP) Act, all the properties belonging to the women, including insurance policy in the name of the husband purchased under MWPA, gets insulated from court attachments or any income tax attachments. For example, if husband were to default on his loan or personal guarantee provided by him, the properties…
Banks are required to make provisions for depreciation on investment as a ‘below the line’ item, after arriving at the profit for the period. Whenever provisions so created on AFS and HFT categories is in excess of requisite amount in any year, such excess amount can be credited to the profit and loss account and…
Reserve Bank of India (RBI) has today (April 4, 2019)announced its first Bi-Monthly Monetary Policy Rates for 2019-20 in Mumbai. The Monitory Policy Committee (MPC) of Reserve Bank of India On the basis of an assessment of the current and evolving macroeconomic situation at its meeting decided to reduce the policy repo rate under the…
A bank’s exposures to its counterparties may result in a concentration of its assets to a single counterparty or a group of connected counterparties. To address this concentration risk RBI has fixed limits on bank exposures to an individual business concern and to business concerns of a group. As per current guidelines of RBI a…
Banks are required to build up of adequate reserves for mark to market (MTM) losses on investments held in AFS and HFT with effect from the year 2018-19. The provisioning for each of these quarters may be spread equally over up to four quarters, commencing with the quarter in which the loss is incurred. The…
Converting volatility (standard deviation) from annual to daily is pretty simple. The thumb rule for calculation is that the volatility is proportional to the square root of time, and not to time itself. For example you have average of 256 days trading days in a year and you find that implied volatility of a particular…
The Reserve Bank of India has mandated the banks to fix limits on their exposure to specific industry or sectors and has prescribed regulatory limits on banks’ exposure to single and group borrowers in India. This measure of RBI is aimed at better risk management and avoidance of credit risks. In addition to credit exposure…
All financial exchanges between one country and another country of the rest of the world are made up of the current account transactions (such as exports and imports of goods and services of a country) and the capital account transaction that reflects net change in ownership of national assets. Capital account includes all kinds of…