Feb 8, 2015

Government to infuse Rs.6990 crore to 9 PSB's

The Government will soon infuse Rs.6990 crore to following 9 Public Sector Undertaking Banks.

State Bank of India Rs.2970 crore
Bank of Baroda Rs.1260 crore
Punjab National Bank Rs.870 crore
Canara Bank Rs.570 crore
Syndicate Bank Rs.460 crore
Allahabad Bank Rs.320 crore
Indian Bank Rs.280 crore
Dena Bank Rs.140 crore
Andhra Bank Rs.120 crore

This is first time that the Government is using efficiency parameter to distribute the capital. The parameter used are 

a) Weighted Average Return on Asset for all PSB's for the last three years will be calculated and those above the average has been considered.

b) Return on equity for last financial year will be calculated and those better than average have been considered.

This year the Government has allocated Rs.11600 crore for capital infusion in PSB's

Feb 3, 2015

Wage Settlement talks dtd 03.02.2015


During the wage settlement talks held between UFBU and IBA today, IBA improved the offer by 0.5% to 13%. This was not accepted by UFBU which had come down from 30 % to 19%. Hence they revived their strike programme which will be observed from 25th February 2015 to 28th February 2015 continued by Indefnite strike from 16th March 2015.

RBI disappoints

6th Bi-monthly monetary policy dtd 3rd February 2015

RBI Governer Mr. Raghuram Rajan disappointed market by not reducing the Bank Rate which was expected at 25 basis points. In the Sixth Bi-monthly monetary policy statement for 2014-15 announced today RBI
  • kept the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 7.75 per cent;
  • kept the cash reserve ratio (CRR) of scheduled banks unchanged at 4.0 per cent of net demand and time liabilities (NDTL);
  • reduced the statutory liquidity ratio (SLR) of scheduled commercial banks by 50 basis points from 22.0 per cent to 21.5 per cent of their NDTL with effect from the fortnight beginning February 7, 2015;
  • replaced the export credit refinance (ECR) facility with the provision of system level liquidity with effect from February 7, 2015;
  • continued to provide liquidity under overnight repos of 0.25 per cent of bank-wise NDTL at the LAF repo rate and liquidity under 7-day and 14-day term repos of up to 0.75 per cent of NDTL of the banking system through auctions; and
  • continue with daily variable rate term repo and reverse repo auctions to smooth liquidity.
Consequently, the reverse repo rate under the LAF will remain unchanged at 6.75 per cent, and the marginal standing facility (MSF) rate and the Bank Rate at 8.75 per cent.

Feb 2, 2015

DA for Bankers from Feb 15 to April 15

Based on CPI announced for Oct, Nov and Dec 2014, the DA will crease by 2 slabs for bankers for Feb, Mar, Apr 2015. The new DA will be 110.10% (+0.3%).

Dec 25, 2014

Corporation Bank - Share Split

Corporation Bank will split its shares from face value of Rs.10 to Rs.2. January 23 will be the record date for the same.

Negotiate - not agitate - IBA tells Bank Unions !!!!!!!!!!!!!

IBA (Indian Banks Association) which represents Bank Management and the Government tells Bank Unions to Negotiate and not agitate !!!!!!!!!!!!!!!.
Mr. Tanksale said "the ninth bipartite settlement was as exception" wherein settlement was arrived at 17.5%. 
This message comes from the IBA after 26 months of negotiation with the unions, If the matter cannot be resolved by IBA even after 26 months of negotiation with the Bank Unions. Then, should the bank employees to wait for another 34 months doing negotiation ???   What was IBA doing in all the rounds of negotiation till date.  
Was Mr. Tanksale right in calling 9th Bipartite settlement abberation wherein 17.5% increase (for a total  period of 5 years) was given. Earlier wage settlements seen the increase of 13%. Then where is abberation.  Does Mr. Tanksale thinks they have given  25% increase in salary ? 
 He also informed “In the current wage settlement, a hike of 11 per cent on salary and allowances has been offered, based on the paying capacity of all the banks, lower profitability, higher requirements for provisions and further capital requirement under Basel-III, translating into 12.5 per cent on the balance sheet cost. This too is unaffordable to some of the banks.”
IBA said the issues regarding wage negotiation deliberated in the Negotiating Committee of the IBA were further discussed in a larger forum — Managing Committee of IBA — and the Chairmen of all the banks felt the demand for 23 per cent increase made by the Unions/Associations is unaffordable, illogical, exorbitant and irrational.
Its surprising that the IBA-Governemnt is thinking miles ahead to increase salary of profit making PSBs. But when the government itself is loss making (due to fiscal deficit) how its paying salary for its Governement servants and how Pay commissions are formed in advance for them ????

Gyan Sangam of Mr. Narendra Modi

Prime Minister Mr. Narendra Modi will have discussions with chiefs of public sector banks and financial instituitions at Pune on 2nd and 3rd of January 2015 to draw action plan for banking reforms. The programme is being called " Gyan Sangam " Apart from Mr. Modi other dignitories who are expected to attend the discussions are Mr. Arun Jaitley, finance minister, Mr. Raghuman Rajan, RBI Governer, Mr.Jayant Sinha, Minister of State for Finance, Mr. Rajiv Mehrishi, Finance Secretary etc.

Major points on which discussions will be held include;

1) Consolidation of banking sector
2) Capitalisation needs of banking sector
3) Risk management
4) Recovery management
5) Human Resources Management

Dec 23, 2014

Wage Revision

Bank Unions action plan for early settlement of Wage Revision;

The wage revision of above 10 lakhs bank employees is due from 1st November 2014. The IBA which represents the Bank Management and Government is very adament to the proposal of wage hike of 25% put by the bankers. IBA is not moving a inch and glued to its 11% hike in wages which the bank unions have opposed. There were strikes by unions on various dates to preasurise the government which have yielded no results till date.

The bank unions have put forth the following plans during January 2015 to March 2015 for the wage revision of the employees;

1) One day strike on 7th January 2014.

If above do not yield any result, then

2) Four day strike from 21st January 2014 to 24th January 2014.

If above also do not yield any result, then

3) Indefinite strike from 16th March 2015

We wish best of luck and early wage settlement for bank employees.

Pre-2005 Currency notes

Now, RBI has informed that Pre-2005 currency notes can be deposited at bank branches till 30th June 2015. Earlier RBI has set 31st December 2014 as the deadline to do so. Now, with extended time you can deposit Pre-2005 with banks at ease and you will get hundred percent value. But don't keep on waiting for RBI to extend the deadline once again. Due it early.

Dec 19, 2014

Bank Wage Settlement

Wage Settlement next actions proposed by UFBU

One day strike on 7th January 2015.

Four day strike from 21st January 2015 to 24th January 2015.

Indefnite strike from 16th March 2015.

Feb 6, 2014

Wage Settlement - AIBOC press release

(taken from 'all banking solution')

REF: AIBOC/2014/01 DATE: 05/02/2014


The revision of salary of around 10 lac bank officers and employees is due from 1st November 2012 for which a comprehensive Charter of Demands was submitted by the Officers’ Organisations to Indian Banks’ Association (IBA) on 30th October 2012. In the last 15 months, 8 rounds of discussions have taken place between IBA and Officers’ Organisations and date of effect from 01.11.2012 and DA Merger points at 440 points were the only two issues settled.

Apart from this, IBA has made an initial offer of 5% salary increase on “pay slip component” which was enhanced to 9.5% after the Unions gave a strike notice and Central Labour Commissioner intervened to avert the strike. In the next round of discussion held on 27th of January 2014, IBA improved the offer by 0.50% i.e. from 9.5% to 10% which was considered as insultingly inadequate and less than what was offered in the last Bipartite Settlement and hence rejected by the Employees’ and Officers’ Organisations.

Bank Strike Stands

The Bank Employees will observe strike on 10th and 11th February 2014 as the concilation meeting held by CLC (Chief Labour Commissioner) and IBA (Indian Bank's Association) , UFBU (United Forum of Bank Unions) held today failed as the IBA did not increase the offer.

Bulk deposit rates shoot up as banks scramble for cash

The liquidity situation may be comfortable, but banks have started building up their balance sheets ahead of the financial year-end to meet yearly targets. This has resulted in a spike in bulk deposit rates as banks are offering as much as 9.4-9.6% as compared to the card rate of 9% for one-year deposits. Bulk deposits are typically Rs 10 Cr and above. Canara Bank, for example, has sealed a Rs 500-Cr bulk deposit deal of one-year maturity with an Andhra Pradesh-based PSU for 9.61%. Similarly, Bank of Baroda offered 9.41% for a Rs 200-Cr deal. The card rate for deposits of similar maturity is 9%. Spectrum outflow and advance tax have left banks worried about liquidity ahead of the financial year-end. Banks are offering 9.4-9.6% as compared to the card rate of 9% for one-year deposits.