Banks News

Haircuts on cases resolved through the Insolvency and Bankruptcy Code (IBC) are still very high, nearly seven years after coming into force. While ₹8.3 lakh crore of debt has been resolved through the IBC till date, financial creditors have had to face a haircut of 73% on average in cases which have gone into resolution, according to data from the Insolvency and Bankruptcy Board of India (IBBI).

Finance minister Niramala Sitharaman is scheduled to meet managing directors of public sector banks (PSBs) on March 25 for a performance review against the backdrop of the failure of a few banks in the US and the liquidity crisis faced by Credit Suisse.

Turmoil in the US and Europe’s banking sector has had an impact on banks in other markets as well, including India. The Nifty Bank index has fallen by over 5% since March 8 when Silvergate Bank collapsed. Since then, three other banks collapsed, while equity markets in the US and Europe fell between 1-5%.

Analysis of insured customer deposits across multiple geographies initiated in the wake of bank runs across developed economies reveal US's top 10 banks deposits are insured in the range of 38.4-66 per cent, according to a research titled, Ecowrap, of the State Bank of India's Economic Research Department.

Reserve Bank of India Governor Shaktikanta Das on Friday gave a thumbs up to the country's banking system, while stressing how recent developments in the US have brought to the fore the criticality of banking sector regulation and supervision.

The National Company Law Tribunal (NCLT) on Friday approved the merger of HDFC and HDFC Bank. This comes after the HDFC twins received in-principle approvals from the Reserve Bank of India (RBI), the Securities and Exchange Board of India (SEBI), and the Competition Commission of India (CCI). Announced in April last year, the HDFC-HDFC Bank merger is the largest in India’s corporate history, with the deal valued at nearly $40 billion.

India's banking system is expected to remain unscathed from the troubles in Credit Suisse as it has a very small presence in the country, experts said.

Mortgage lender HDFC Ltd on Friday said its board would consider raising funds through non-convertible debentures (NCDs) in tranches aggregating to Rs 57,000 crore.

Debunking media reports which indicated a possibility of deferment of IDBI Bank disinvestment, the Department of Investment and Public Asset Management (DIPAM) said the stake sale is in the post-EoI stage. The government and the LIC are together selling about 61 per cent stake in IDBI Bank and had in January received multiple Expressions of Interest (EoIs) for the same.

IndusInd Bank’s stock has come under selling pressure recently after the lender’s chief executive officer Sumanth Kathpalia received a lower extension from the Reserve Bank of India (RBI) than what was ratified by IndusInd Bank’s board. The RBI approved a 2-year extension on March 10, while IndusInd Bank’s board had ratified a 3-year extension back in September 2022. This spooked investors, leading to IndusInd Bank’s stock falling over 10% on March 13.

Kotak Mahindra Bank CEO Uday Kotak said on Thursday said that with macro factors turning positive, India can "navigate well" the current turmoil in the global financial market and stand out.

Europe's main markets have opened higher after moves from the Swiss Central Bank reassured investors over the financial health of Credit Suisse, the media reported.

​​Largest bank failures in the history of the US...

Indian banks in both the public and private sectors have passed global brokerage Jefferies’ SVB test – an assessment of the quality of deposits as well as the impact of mark-to-market losses on the bonds held by banks till maturity. The brokerage says Indian banks are well placed due to high quality deposits and lesser reliance on investment in securities.

Amid the US administration's move to backstop collapsed Silicon Valley Bank's (SVB) deposits, IT minister Ashwini Vaishnaw has said the developments are "reassuring" and will bring relief to startups.

"FDIC's communication yesterday saying all depositors will get access to their funds is a relief to the startup community," said Prabhu Ramachandran, CEO & Co-founder at Facilio, a property operations software provider.

Billionaire hedge fund manager Bill Ackman says more banks will probably fail even if U.S. authorities step in to shore up confidence in the banking system after last week's collapse of Silicon Valley Bank, Daily Mail reported.

The Reserve Bank is likely to hike benchmark lending rates by 25 basis points in its bi-monthly policy next month to bring down inflation within the central bank's comfort zone, DBS Group Research said on Monday.

The collapse of three banks in the US, including the giant Silicon Valley Bank (SVB), within a week has hammered the global crypto market, wiping off more than $70 billion as Bitcoin fell below $20,000 per single coin.

Silicon Valley Bank's abrupt collapse - which unfolded in a matter of hours earlier last week - has left Silicon Valley entrepreneurs unnerved and jittery. Federal Deposit Insurance Corporation on Friday seized the assets of Silicon Valley Bank - the action reportedly in the middle of the business day highlighted the severity of the situation.

Silicon Valley Bank collapsed on Friday, while New York-based Signature Bank was closed by the state regulators on Sunday (local time), becoming the second US bank to have collapsed.

Digital or e-rupee worth over Rs 130 crore is in circulation on a pilot basis as of February 28, finance minister Nirmala Sitharaman said on Monday.