|
Report Date : |
06.07.2013 |
IDENTIFICATION DETAILS
|
Name : |
RESERVE BANK OF |
|
|
|
|
Registered
Office : |
|
|
|
|
|
Country : |
|
|
|
|
|
Financials (as
on) : |
30.06.2012 |
|
|
|
|
Year of
Establishment : |
01.04.1935 |
|
|
|
|
Capital
Investment / Paid-up Capital : |
Rs. 50.000 Millions |
|
|
|
|
Legal Form : |
|
|
|
|
|
Line of Business
: |
The Bank is entrusted with monetary stability, management of currency
and supervision of financial system. |
|
|
|
|
No. of Employees
: |
20000 [Approximately] |
RATING & COMMENTS
|
MIRA’s Rating : |
Aaa (89) |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
|
Maximum Credit Limit : |
Large |
|
|
|
|
Status : |
Excellent |
|
|
|
|
Payment Behaviour : |
Prompt |
|
|
|
|
Litigation : |
Clear |
|
|
|
|
Comments : |
The Reserve Bank of India was established on April 1, 1935 in accordance with the provisions of the Reserve Bank of India Act, 1934. The Central Office of the Reserve Bank was initially established in Calcutta but was permanently moved to Mumbai in 1937. The Central Office is where the Governor sits and where policies are formulated. RBI assumes an important
part in the development strategy of the Government of India, and as a leading
member of the Alliance for Financial Inclusion (AFI), is notably
active in promoting financial inclusion policy. RBI is also a member of the Asian Clearing Union. It is the central bank of
the country which has control over other banks in India. Its main functions are;
Trade
relations are praiseworthy. Business is active. Payment terms are prompt. The bank can be considered excellent for any business dealings at usual trade terms and conditions. |
NOTES :
Any query related to this report can be made
on e-mail : infodept@mirainform.com
while quoting report number, name and date.
ECGC Country Risk Classification List – March 31st, 2013
|
Country Name |
Previous Rating (31.12.2012) |
Current Rating (31.03.2013) |
|
India |
A1 |
A1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very
High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
RBI DEFAULTERS’ LIST STATUS
Subject’s name is not enlisted as a defaulter
in the publicly available RBI Defaulters’ list.
EPF (Employee Provident Fund) DEFAULTERS’ LIST STATUS
Subject’s name is not enlisted as a defaulter
in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of
31-03-2012.
LOCATIONS
|
Registered Office : |
|
|
Tel No.: |
91-22-22660868 |
|
Fax No.: |
91-22-22661784 |
DIRECTORS
AS ON 30.06.2012
|
Name : |
Mr. D Subbarao |
|
Designation : |
Governor |
|
Address : |
Reserve Bank of |
|
|
|
|
Name : |
Mr. Anand Sinha |
|
Designation : |
Deputy Governor |
|
Address : |
Reserve Bank of |
|
|
|
|
Name : |
Mr. H.R. Khan |
|
Designation : |
Deputy Governor |
|
Address : |
Reserve Bank of |
|
|
|
|
Name : |
Mr. K C Chakrabarty |
|
Designation : |
Deputy Governor |
|
Address : |
Reserve Bank of |
|
|
|
|
Name : |
Mr. Subir Gokarn |
|
Designation : |
Deputy Governor |
|
Address : |
Reserve Bank of |
|
|
|
|
DIRECTORS NOMINATED UNDER SECTION 8 (1) (B) OF THE RBI ACT, 1934 |
|
|
|
|
|
Name : |
Mr. Anil Kakodkar |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Kiran Karnik |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. M. V. Rajeev Gowda |
|
Designation : |
Director |
|
|
|
|
DIRECTORS NOMINATED
UNDER SECTION 8 (1) (C) OF THE RBI ACT, 1934 |
|
|
|
|
|
Name : |
Mr. Y H Malegam |
|
Designation : |
Director |
|
Address : |
Meher Chambers (2nd floor) R. Kamani Road, Ballard Estate, Mumbai 400
001, Maharashtra, India |
|
|
|
|
Name : |
Mr. Azim Premji |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Kumar Mangalam Birla |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Dipankar Gupta |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Najeeb Jung |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. G. M. Rao |
|
Designation : |
Director |
|
|
|
|
Name : |
Ms. Ela Bhatt |
|
Designation : |
Director |
|
|
|
|
Name : |
Ms. Indira Rajaraman |
|
Designation : |
Director |
|
|
|
|
DIRECTORS NOMINATED
UNDER SECTION 8 (1) (D) OF THE RBI ACT, 1934 |
|
|
|
|
|
Name : |
Mr. D. K. Mittal |
|
Designation : |
Director |
|
|
|
|
Name : |
Mr. Arvind Mayaram |
|
Designation : |
Director |
|
|
|
|
MEMBER OF LOCAL BOARDS |
|
|
|
|
|
Western Area: |
Mr. Kiran Karnik Mr. K.
Venkatesan Mr. Dattaraj V.
Salgaocar Mr. Jayantilal B. Patel |
|
|
|
|
Eastern Area: |
Mr. Anila Kumari Mr. Sharif Uz-zaman Laskar |
|
|
|
|
Northern Area: |
Mr. Anil
Kakodkar Mr. Ram Nath Mr. Kamal
Kishore Gupta Mr. Mihir Kumar
Moitra Mr. A. Naveen Bhandary |
|
|
|
|
Southern Area: |
Mr. M.V. Rajeev
Gowda Mr. M. Govinda
Rao Mr. K. Selvaraj Mr. Kiran Pandurang |
|
|
|
|
Name : |
Mr. V K Sharma |
|
Designation : |
Executive Director |
|
|
|
|
Name : |
Mr. G. Gopalakrishna |
|
Designation : |
Executive Director |
|
|
|
|
Name : |
Mr. Deepak Mohanty |
|
Designation : |
Executive Director |
|
|
|
|
Name : |
Mr. S. Karuppasamy |
|
Designation : |
Executive Director |
|
|
|
|
Name : |
Mr. R. Gandhi |
|
Designation : |
Executive Director |
|
|
|
|
Name : |
Mr. P. Vijaya Bhaskar |
|
Designation : |
Executive Director |
|
|
|
|
Name : |
Mr. B. Mahapatra |
|
Designation : |
Executive Director |
|
|
|
|
Name : |
Mr. G. Padmanabhan |
|
Designation : |
Executive Director |
|
|
|
|
Name : |
Mr. Jasbir Singh |
|
Designation : |
Executive Director |
PRINCIPAL OFFICERS
|
CENTRAL OFFICE |
|
|
Central Vigilance Cell |
Mr. Kaza Sudhakar, Chief General Manager |
|
Customer Service Department |
Ms. Suma Varma, Chief General Manager |
|
Department of Banking Operations and Development |
Mr. Deepak Singhal, Chief General Manager-in-Charge |
|
Department of Banking Supervision |
Mr. G. Jaganmohan Rao, Chief General Manager-in-Charge |
|
Department of Communication |
Ms. Alpana Killawala, Press Relations Offi cer (Gr. F) |
|
Department of Currency Management |
Mr. B.P. Vijayendra, Chief General Manager |
|
Department of Economic and Policy Research |
Mr. B.M. Misra, Offi cer-in-Charge |
|
Department of Expenditure and Budgetary Control |
Mr. B. Srinivas, Chief General Manager |
|
Department of External Investments and Operations |
Mr. M. S. Deb, Chief General Manager |
|
Department of Government and Bank Accounts |
Mr. A.K. Bera, Chief General Manager-in-Charge |
|
Department of Information Technology |
Mr. A.S. Ramasastri, Chief General Manager-in-Charge |
|
Department of Non-Banking Supervision |
Ms. Uma Subramaniam, Chief General Manager-in-Charge |
|
Department of Payment and Settlement Systems |
Mr. Vijay Chugh, Chief General Manager |
|
Department of Statistics and Information Management |
Mr. A.B. Chakraborty, Offi cer-in-Charge |
|
Financial Markets Department |
Mr. G. Mahalingam, Chief General Manager |
|
Financial Stability Unit |
Mr. R.G. Warriar, Chief General Manager |
|
Foreign Exchange Department |
Ms. Sujata E. Prasad, Chief General Manager |
|
Human Resource Management Department |
Mr. Sandip Ghose, Chief General Manager-in-Charge |
|
Inspection Department |
Mr. U.S. Paliwal, Chief General Manager |
|
Internal Debt Management Department |
Mr. K.K. Vohra, Chief General Manager |
|
Legal Department |
Mr. G.S. Hegde, Principal Legal Adviser |
|
Monetary Policy Department |
Mr. M.D. Patra, Adviser-in-Charge |
|
Premises Department |
Mr. K.R. Ananda, Chief General Manager |
|
Rajbhasha Department |
Mr. Ramakant Gupta, Deputy General Manager |
|
Risk Management Department |
Mr. N. Krishna Mohan, Chief General Manager |
|
Rural Planning and Credit Department |
Mr. C.D. Srinivasan, Chief General Manager |
|
Secretary’s Department |
Mr. Grace E. Koshie, Chief General Manager & Secretary |
|
Urban Banks Department |
Mr. A. Udgata, Chief General Manager-in-Charge |
|
|
|
|
COLLEGES |
PRINCIPALS/CHIEF
GENERAL MANAGER |
|
College of Agricultural Banking, Pune |
Mr. Meena Hemchandra |
|
Reserve |
Mr. J. Sadakkadulla |
|
|
|
|
OFFICES |
REGIONAL
DIRECTORS |
|
Chennai |
Mr. N.S. Vishwanathan |
|
Kolkata |
Mr. B.P. Kanungo |
|
Mumbai |
Mr. J.B. Bhoria |
|
New Delhi |
Mr. Chandan Sinha |
|
|
|
|
BRANCHES |
|
|
Ahmedabad |
Mr. Sudarshan Sen |
|
Bangalore |
Ms. Uma Shankar |
|
Bhopal |
Mr. P.R. Ravi Mohan |
|
Bhubaneswar |
Mr. V. Ramchandra Rao |
|
Chandigarh |
Mr. M. K. Singh |
|
Guwahati |
Mr. Pradyumna K. Jena |
|
Hyderabad |
Mr. A.S. Rao |
|
Jaipur |
Ms. Deepali Pant Joshi |
|
Jammui |
Mr. K.K. Saraf |
|
Kanpur |
Mr. K.R. Das |
|
Lucknow |
Mr. Rabi N. Mishra |
|
Nagpur |
Mr. Phulan Kumar |
|
Patna |
|
|
Thiruvananthapuram |
Salim Gangadharan |
|
|
|
|
|
OFFICERS-IN-CHARGE |
|
Agartala |
Mr. A.K. Pandey, General Manager |
|
Belapur |
Mr. S. Bhatnagar, General Manager |
|
Dehradun |
Mr. R.L. Das, General Manager |
|
Gangtok |
Mr. E.E. Karthak, General Manager |
|
Kochi |
Mr. C.V. George, General Manager |
|
Panaji |
Mr. Jaikish, General Manager |
|
Raipur |
Mr. Nirmal Chand, General Manager |
|
Ranchi |
Mr. H.N. Panda, General Manager |
|
Shimla |
Mr. R. Gurumurthy, General Manager |
|
Shillong |
Mr. P. Shyam Sunder, General Manager |
|
Srinagar |
Mr. B.S. Katoch, Deputy General Manager |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
NOT AVAILABLE
BUSINESS DETAILS
|
Line of Business : |
The Bank is entrusted with monetary stability, management of currency
and supervision of financial system. |
GENERAL INFORMATION
|
No. of Employees : |
20000 [Approximately] |
|
|
|
|
Bankers : |
Reserve Bank of India |
|
|
|
|
Banking
Relations : |
-- |
|
|
|
|
Auditors : |
|
|
Name : |
Jain Chowdhary and Company Chartered Accountants |
|
Address : |
Mumbai, Maharashtra, India |
CAPITAL STRUCTURE
AS ON 30.06.2012
Paid Up Capital: Rs. 50.000 Millions.
FINANCIAL DATA
[all figures are in
Rupees Millions]
BALANCE SHEET
ISSUED DEPARTMENT
|
Liabilities |
30.06.2012 |
30.06.2011 |
30.06.2010 |
Assets |
30.06.2012 |
30.06.2011 |
30.06.2010 |
|
|
|
|
|
|
|
|
|
|
Notes held in the Banking Department |
89.169 |
151.426 |
326.151 |
Gold Coin and
Bullion: |
|
|
|
|
Notes in Circulation |
11034645.327 |
9692612.385 |
8420083.640 |
a) Held in |
760096.797 |
578065.257 |
485772.152 |
|
|
|
|
|
b) Held Outside |
-- |
-- |
-- |
|
|
|
|
|
Foreign Securities |
10261966.851 |
9101656.191 |
7923009.296 |
|
Total Notes Issued |
11034734.496 |
9692763.811 |
8420409.791 |
Total |
11022063.648 |
9679721.448 |
8408781.448 |
|
|
|
|
|
Rupee Coin |
2206.548 |
2578.063 |
1164.043 |
|
|
|
|
|
Government of |
10464.300 |
10464.300 |
10464.300 |
|
|
|
|
|
Internal Bills of Exchange and other Commercial Paper |
-- |
-- |
-- |
|
Total
Liabilities |
11034734.496 |
9692763.811 |
8420409.791 |
Total Assets |
11034734.496 |
9692763.811 |
8420409.791 |
BANKING
DEPARTMENT
|
Liabilities |
30.06.2012 |
30.06.2011 |
30.06.2010 |
Assets |
30.06.2012 |
30.06.2011 |
30.06.2010 |
|
|
|
|
|
|
|
|
|
|
Capital Paid-up |
50.000 |
50.000 |
50.000 |
Notes |
89.169 |
151.426 |
326.151 |
|
Reserve Fund |
65000.000 |
65000.000 |
65000.000 |
Rupee Coin |
0.418 |
0.534 |
0.634 |
|
National Industrial Credit (Long Term Operations) Fund |
210.000 |
200.000 |
190.000 |
Small Coin |
0.125 |
0.225 |
0.308 |
|
National Housing Credit (Long Term Operations) Fund |
1950.000 |
1940.000 |
1930.000 |
Bills Purchased
and Discounted |
|
|
|
|
|
|
|
|
a) Internal |
-- |
-- |
-- |
|
Deposits |
|
|
|
b) External |
-- |
-- |
-- |
|
a) Government |
|
|
|
c) Government Treasury Bills |
-- |
-- |
-- |
|
i) Central Government |
1004.903 |
1005.130 |
364574.108 |
|
|
|
|
|
ii) State Government |
424.570 |
424.443 |
413.315 |
Balance Held Abroad |
3640273.093 |
3035309.297 |
3392263.423 |
|
b)Banks |
|
|
|
Investments |
6305897.052 |
4586062.175 |
3100688.135 |
|
i) Scheduled Commercial Banks |
3419535.741 |
3812064.138 |
3077594.100 |
Loan and Advances
to |
|
|
|
|
ii) Scheduled State Co-Operative Banks |
33242.701 |
36798.218 |
40654.376 |
i) Central Government |
-- |
7700.000 |
-- |
|
iii) Other Scheduled Co-Operative Banks |
53643.644 |
57553.642 |
49867.682 |
ii) State Government |
7307.400 |
765.100 |
733.800 |
|
iv) Non-Scheduled State Co-Operative Banks |
916.213 |
673.180 |
686.380 |
Loans and
Advances to |
|
|
|
|
v) Other Banks |
92870.015 |
103578.103 |
92247.962 |
i) Scheduled Commercial Banks |
167962.800 |
17466.900 |
26231.700 |
|
c) Others |
122045.831 |
124307.591 |
128077.253 |
ii) |
390.000 |
-- |
-- |
|
|
|
|
|
iii) Other Scheduled Co-Operative Banks |
1290.000 |
-- |
410.000 |
|
Bills Payable |
270.361 |
8331.436 |
794.562 |
iv) Non-Scheduled State Co-Operative Banks |
-- |
-- |
-- |
|
|
|
|
|
v)NABARD |
-- |
-- |
-- |
|
|
|
|
|
vi) Others |
28902.498 |
7952.848 |
2752.298 |
|
Other Liabilities |
7263.548 |
4141971.513 |
3288093.560 |
Loans, Advances and Investments form National Industrial Credit (Long
Term Operations) Fund |
|
|
|
|
|
|
|
|
a) Loans and
Advances to |
|
|
|
|
|
|
|
|
i) Industrial Development Bank of |
-- |
-- |
-- |
|
|
|
|
|
ii) Export Import Bank of |
-- |
-- |
-- |
|
|
|
|
|
iii) Industrial Investment Bank of India Limited |
-- |
-- |
-- |
|
|
|
|
|
iv) Others |
-- |
-- |
-- |
|
|
|
|
|
Loans, Advances and
Investments form National Housing Credit (Long Term Operations) Fund: |
|
|
|
|
|
|
|
|
a) Loans and Advances to National Housing Bank |
-- |
-- |
-- |
|
|
|
|
|
b) Investments in bonds/ debentures issued by National Housing Bank |
-- |
-- |
-- |
|
|
|
|
|
Other Assets |
902599.552 |
698488.889 |
586766.849 |
|
|
|
|
|
|
|
|
|
|
TOTAL
LIABILITIES |
11054712.107 |
8353897.394 |
7110173.298 |
TOTAL ASSETS |
11054712.107 |
8353897.394 |
7110173.298 |
PROFIT & LOSS
ACCOUNT
|
INCOME |
30.06.2012 |
30.06.2011 |
30.06.2010 |
|
|
|
|
|
|
Interest, Discount, Exchange, Commission Etc. |
261508.821 |
236682.172 |
271661.224 |
|
TOTAL |
261508.821 |
236682.172 |
271661.224 |
|
|
|
|
|
|
EXPENDITURE |
|
|
|
|
|
|
|
|
|
Interest |
587.780 |
550.644 |
10.160 |
|
Establishment |
29934.972 |
23007.071 |
19868.229 |
|
Directors’ and local Board Members’ Fees and Expenses |
29.802 |
22.961 |
20.815 |
|
Remittance of Treasure |
528.245 |
455.277 |
371.210 |
|
Agency Charges |
33508.790 |
30124.883 |
28550.206 |
|
Security Printing (Cheques, Note Forms etc.) |
27037.058 |
23763.720 |
27541.235 |
|
Printing and Stationery |
257.177 |
233.259 |
265.889 |
|
Postage and Telecommunication Charge |
804.859 |
718.443 |
424.893 |
|
Rent, Taxes, Insurance, Lighting etc. |
1022.927 |
855.027 |
851.556 |
|
Auditors’ Fees and Expenditure |
26.794 |
31.386 |
25.117 |
|
Law Charge |
27.879 |
32.684 |
27.554 |
|
Depreciation and Repairs to Bank’s Property |
2424.716 |
2439.195 |
2742.193 |
|
Miscellaneous Expenses |
5177.822 |
4317.622 |
3332.167 |
|
|
|
|
|
|
TOTAL |
101368.821 |
86552.172 |
84031.224 |
|
|
|
|
|
|
Available Balance |
160140.000 |
150130.000 |
187630.000 |
|
Less: Contribution To: |
|
|
|
|
National Industrial Credit (Long Term Operations) Fund |
10.000 |
10.000 |
10.000 |
|
National Rural Credit ( Long Term Operations) Fund |
10.000 |
10.000 |
10.000 |
|
National Rural Credit (Stabilization) Fund |
10.000 |
10.000 |
10.000 |
|
National Housing Credit (Long Term Operations) Fund |
10.000 |
10.000 |
10.000 |
|
|
40.000 |
40.000 |
40.000 |
|
|
|
|
|
|
Surplus Payable
to the Central Government |
160100.000 |
150090.000 |
18759.000 |
LOCAL AGENCY FURTHER INFORMATION
|
Sr. No. |
Check List by
Info Agents |
Available in
Report (Yes / No) |
|
1] |
Year of Establishment |
Yes |
|
2] |
Locality of the firm |
Yes |
|
3] |
Constitutions of the firm |
Yes |
|
4] |
Premises details |
No |
|
5] |
Type of Business |
Yes |
|
6] |
Line of Business |
Yes |
|
7] |
Promoter's background |
Yes |
|
8] |
No. of employees |
Yes |
|
9] |
Name of person contacted |
No |
|
10] |
Designation of contact person |
No |
|
11] |
Turnover of firm for last three years |
Yes |
|
12] |
Profitability for last three years |
Yes |
|
13] |
Reasons for variation <> 20% |
-- |
|
14] |
Estimation for coming financial year |
No |
|
15] |
Capital in the business |
Yes |
|
16] |
Details of sister concerns |
No |
|
17] |
Major suppliers |
No |
|
18] |
Major customers |
No |
|
19] |
Payments terms |
No |
|
20] |
Export / Import details (if applicable) |
No |
|
21] |
Market information |
-- |
|
22] |
Litigations that the firm / promoter involved in |
-- |
|
23] |
Banking Details |
No |
|
24] |
Banking facility details |
No |
|
25] |
Conduct of the banking account |
-- |
|
26] |
Buyer visit details |
-- |
|
27] |
Financials, if provided |
Yes |
|
28] |
Incorporation details, if applicable |
Yes |
|
29] |
Last accounts filed at ROC |
Yes |
|
30] |
Major Shareholders, if available |
No |
|
31] |
PAN of Proprietor/Partner/Director, if available |
No |
|
32] |
Date
of Birth of Proprietor/Partner/Director, if available |
No |
|
33] |
Voter ID No of Proprietor/Partner/Director, if available |
No |
|
34] |
External Agency Rating, if available |
No |
ASSESSMENT OF 2011-12:
In 2011-12, growth
decelerated in each successive quarter. On the other hand, average inflation
remained high, though it moderated in the last four months of the year. In the
context of the growth-inflation dynamics, an assessment of the role of both
monetary and fiscal policy and the impact on growth slowdown on asset quality
are set out below.
ROLE OF MONETARY
AND NON-MONETARY FACTORS IN GROWTH SLOWDOWN
After recording a rise
of 8.4 per cent during 2009-10 and 2010-11, growth dropped to 6.5 per cent in
2011-12. Growth in Q4 of 2011-12 of 5.3 per cent was the lowest in 29 quarters.
Early indications are that activity levels continued to be slow during Q1 of
2012-13, with industrial growth stagnating, slack persisting in investment
activity and consumption decelerating.
The Reserve Bank
had gradually tightened monetary policy over last two years through 13 policy
rate hikes that began in March 2010 and continued till October 2011, raising
operational policy rates by 525 basis points (bps) from 3.25 to 8.5 per cent.
It also hiked the Cash Reserve Ratio (CRR) twice, increasing it by 100 bps from
5 to 6 per cent of NDTL. Given these measures, there has been a perception that
the Reserve Bank’s monetary tightening has been predominantly behind the growth
slowdown. In this context, there are two important factors to be considered.
First, the initial rounds of increase were more in the nature of normalization
of policy from its crisis driven excessive accommodative stance. Such
normalization could not have had an adverse impact on growth. Second, even at
the current level of the policy rate, the real effective lending rates of banks
are relatively lower in comparison with their pre-crisis levels. This
highlights the fact that policy rates alone cannot explain the sharp growth
slowdown observed in the last few quarters.
An exercise
undertaken by the Reserve Bank to calculate Weighted Average Lending Rate
(WALR) of scheduled commercial banks using the accounts-level data from Basic
Statistical Returns (BSR) suggests that this effective lending rate in nominal
terms increased during 2011-12 in response to monetary tightening. Preliminary
data suggests that the WALR increased to 12.7 per cent, which was slightly
higher than the average of 12.4 per cent in the pre-crisis period. Nominal
rates had fallen in the post-crisis period before hardening in 2011-12. Real
(net of inflation) WALR also increased moderately to about 3.8 per cent in 2011-12,
but remained lower than the average of about 7.0 per cent in the pre-crisis
period of 2003-04 to 2007-08, when an investment boom took place. The fall in
real lending rates in post-crisis period is even sharper if GDP deflators are
used to calculate inflation instead of WPI. The fact is that real lending rates
have secularly declined since 2003-04. During this period, investment boomed
initially, but stalled in recent years even though real rates continued to
decline.
Interest rates are
only one of the many factors in an investment decisions. These decisions in any
case depend on interest rate view over several cycles. Interest rates increased
during 2011-12 and may have impacted investment, but they are clearly not the
primary reason for the downturn. The decline in investment started earlier in
H2 of 2010-11 for reasons that were linked to global uncertainties, structural
constraints, loss of pro-reform policy momentum, persistent inflation and
increasing business uncertainties.
Growth had
decelerated in the Indian economy through successive quarters of 2011-12,
dropping from 9.2 per cent in Q4 of 2010-11 to 5.3 per cent in Q4 of 2011-12.
This steep 3.8 percentage point drop did prompt the Reserve Bank to shift its
policy stance by first pausing and then front-loading the cut in the repo rate
by 50 bps in April 2012.
Monetary policy is
framed on several considerations of which inflation (the pace at which general
level of prices changes) and growth (the pace at which national output
increases) are the two main ones. Headline inflation was running at 9-10 per
cent rate in each of the first eight months of 2011-12 – way above the Reserve
Bank’s comfort-level of 4-5 per cent. Thus, the inflation gap (actual less
intended level of inflation) far exceeded the output gap (actual less potential
output). While these gaps cannot mechanically determine the policy rate
setting, they constitute an important consideration in calibrating monetary
policy response. Any premature easing would have caused inflation risks to rise
thereby adversely affecting growth over the medium-term.
In this context,
it is important to appreciate as to what monetary policy can or cannot do.
First, monetary policy can have a strong long-run impact on inflation, but can
influence output in a more limited way by nudging growth towards potential when
growth operates below or above potential. Importantly, monetary policy cannot
bring about permanent or long-run changes in the levels of output, which are
mainly driven by technology, productivity changes and fiscal policy, through
its impact on thrift and investment behaviour.
Second, the
adverse welfare consequences of high and persistent inflation are large.
Slowdown does raise unemployment and lowers income and consumption, especially
of those who lose jobs. In a country like India, business cycle fluctuations
that cause output and job losses are more pronounced in organized than
unorganized sector and impacts agricultural output relatively less. However, a
rise in inflation generally lowers consumption across the- board in varying
degrees. It acts like a regressive tax and hurts the poor the most as they are
virtually un hedged against inflation.
Since the April
2012 policy, the growth outlook has turned weaker, while the inflation path moved
slightly higher. While core inflationary pressures remained low, they have not
fallen commensurate to the growth slowdown. On the other hand, food inflation
pressures have re-emerged and are likely to be exacerbated by drought
conditions following the unsatisfactory monsoon so far. Consequently, monetary
policy will need to be carefully calibrated to the evolving growth-inflation
dynamics.
PROSPECTS FOR
2012-13
GROWTH OUTLOOK FOR 2012-13
The growth outlook
for 2012-13 remains weak as combination of global and domestic macroeconomic
factors that slowed down growth in the preceding year have persisted and show
no signs of getting resolved. Globally, the sovereign and bank debt overhang is
still keeping the financial markets under stress. The global trade outlook has
deteriorated as growth in emerging markets is slowing down in addition to
recession taking roots in euro area and US also headed for a slower growth.
On the domestic
front, macro-economic conditions are unlikely to improve in near term as a
spell of policy stasis, structural and cyclical problems have combined to slow
down the economy. Growth is slowing down, while inflation remains sticky at
above comfort levels. However, the Government in August 2012, promised to take
several steps to address the macro-economic weakness. These would include, the
return to path of fiscal consolidation, bringing in a clear and stable tax
regime, encourage saving and investment, including foreign investments and work
towards generating supply-side responses to lower inflation. Key decisions to
put fiscal consolidation back on track such as hikes in administered fuel
prices, slashing of other subsidies and introduction of Goods and Service Tax
(GST) have been delayed and there is urgency to quickly move on the indicated
lines to avert further deepening of problems. As these steps materialize,
growth could gradually start improving later this year and trend growth can be
restored by next year. At the current juncture there is no scope for
complacency as fiscal slippage is likely during 2012-13 and CAD is likely to
stay above sustainable level. With fluid situation for the global economy,
macro risks from twin deficits remain large and need to be addressed forthwith.
Structural factors
that are impeding growth remain unaddressed. Mining activity continues be
stalled in absence of a streamlined regulatory and environmental framework.
While growth in the interim may have suffered as a result of attempt at legal
and environmental enforcement, ultimately an incentive-compatible framework for
business that penalizes fraud and encourages ethical practices while ensuring
fair return alone can provide a conducive investment climate. Somewhat similar
problems also prevail in telecom space. New power sector investments are falling
as coal linkage and pricing issues are yet to be satisfactorily resolved and
State Electricity Board (SEB) losses are large. Road projects are confronting
multiple issues that include land acquisition problems as well as financing
constraints for overleveraged road developers. As a result, road tendering has
nearly stalled during Q1 of 2012-13 after a record pace of project tendering in
2011-12. These issues need to be quickly resolved while keeping lending
discipline for banks.
Newer
uncertainties for growth in 2012-13 have emerged from the unsatisfactory
progress of monsoon so far which is likely to result in a contraction in food
grains output during 2012-13. Despite the recent revival, cumulative rainfall
up to August 16, 2012 was 16 per cent deficient. The Reserve Bank’s production
weighted rainfall index (PRN) showed an even higher deficit of 21 per cent. The
spatial pattern of monsoon suggests that output losses could be substantial for
coarse cereals and pulses, While this year the drought conditions in parts of
country are marginally less severe than that during the 2009 drought, the
monsoon has been unsatisfactory to a degree that has dampened the prospects for
agriculture during 2012-13. During 2009-10, Rabi crop reached record levels, while the Rabi prospects
this year remain uncertain and would depend crucially on September rains that
will determine the soil moisture content and the reservoir levels.
Growth during the
year is likely to stay below potential for the second consecutive year. The
Reserve Bank in its First Quarter Review of Monetary Policy on July 31, 2012,
revised downwards its growth projection for 2012-13 to 6.5 per cent from 7.3
per cent. The downward revision mainly reflects drought impact on agricultural
output and contraction in IIP during Q1 of 2012-13. Given the greater
integration of the Indian economy with global economy, decelerating global
growth and trade volumes will adversely impact India’s industry and services
sector growth. In addition, the lagged impact of weak industrial growth is
likely to weigh on services sector growth.
The key question,
therefore, is: what can stimulate a recovery? In absence of signs of global
conditions improving, the burden of adjustment would have to be borne by
domestic policies. Structural impediments impacting business confidence need to
be addressed immediately. This is particularly true of the mining and
infrastructure sectors. With limited fiscal and monetary space available to
provide a direct stimulus to domestic growth, an expenditure switching policy
is needed that reduces government’s revenue spending by cutting subsidies and
using the resources so released to step up public capital expenditures. Such an
action would also provide some space for monetary policy, but, importantly,
lower interest rates alone are unlikely to jumpstart the investment cycle.
Fast-tracking of infrastructure projects and pending regulatory clearances will
help to boost investments. The Government has initiated some steps to augment
the production potential of core sectors, in particular mining, in the recent
period. However, a lot more needs to be done to boost the performance of core
industries and lead revival of industrial growth.
INFLATION OUTLOOK FOR 2012-13
The inflation
outlook for 2012-13 remains better than the previous year, though the inflation
trajectory could remain sticky. Headline inflation averaged 7.3 per cent during
April-July 2012; lower than the 8.9 per cent verage for 2011-12. After dropping
moderately in December 2011, headline inflation has neither risen nor fallen
further in a perceptible manner. The Reserve Bank’s proxy for core inflation,
non-food manufacturing inflation, averaged 7.8 per cent in the first three
quarters of 2011-12 but dropped noticeably to 5.9 per cent in the last quarter.
It has now dropped further and averaged 5.0 per cent in Q1 of 2012-13, though
it showed some uptick in July 2012 and remained above its decade average in the
2000s. While persistence of inflation is still worrisome, some relief has been
provided by the decline in the recent period.
The Reserve Bank,
in its First Quarter Review of Monetary Policy on July 31, 2012, revised
upwards its baseline projection for headline inflation in March 2013 to 7.0 per
cent from 6.5 per cent factoring in the upside risks to inflation. Earlier
projection was based on the assumption of normal monsoon that has not
materialized. Also, the moderation in non-food manufactured product inflation
has not been commensurate with moderation in growth. Persistence of inflation,
even as growth is slowing, has emerged as a major policy challenge.
Inflation control
remains the cornerstone of monetary policy as upside risk to inflation remain.
This is largely due to unsatisfactory monsoon, large upward revision in MSPs on
back of cost escalation (averaging 26 per cent for kharif) and exchange rate depreciation during Q1 of 2012-13.
Latest assessment suggests that there could be considerable upside pressure on
prices of pulses. Some of this is already in evidence. Except for Myanmar,
pulses crop has failed globally and options for imports are rather limited.
Pressures to some extent can also emanate in case of edible oils, though
soyabean crop can substantially offset the groundnut shortfall. Risks to global
commodity prices that had fallen in Q1 of 2012-13 also remain. The prevailing
drought in the parts of US, Eurasia and Australia may add to price pressures on
food in the global markets. Pass-through from moderation in global commodity
prices to domestic inflation has in any case been partially offset by rupee
deprecation.
Other upside risks
arise from suppressed inflation in energy, especially diesel, electricity, coal
and fertilizer prices that need to be adjusted upwards. The path of inflation
could thus be impacted by the timing and magnitude of administered price
revisions, though it must be emphasized that such adjustments have become
necessary to reduce pressure on medium-term inflation from an expansionary
fiscal policy. Continued pressure from wages and the structural nature of
protein inflation could keep inflation high even with moderation in growth.
So while inflation
risks in 2012-13 are on the upside, there is a need to distinguish between
temporary and permanent supply shocks. Structural shocks evident in inflation
emanating from protein food, oil and some commodities require appropriate short
and medium-term responses from the supply side. However, notwithstanding the
cause, persistent inflation, if left unchecked, could unhinge inflation
expectations and lead to eventual generalization of inflation as had happened
in Q4 of 2010-11. Furthermore, demand pressures emanating from high rural wages
and growing corporate staff costs would need to be factored in. In such
situation, close vigil on inflation would be necessary during 2012-13 to
prevent re-emergence of inflationary pressures.
MEDIUM-TERM
CHALLENGES FOR THE INDIAN ECONOMY
PRESERVING INDIA’S
GROWTH STORY THROUGH REVIVAL OF INFRASTRUCTURE INVESTMENTS
India’s growth
story in recent past has been substantially driven by large infrastructure
investments. Foreign direct investments in this sector have not been very
large, but large investments, both in public and private sectors during last
10-years catapulted India to the rank of second fastest growing economy in the
world after China. Yet, over the past year or two, infrastructure sector has
reached a critical point of entanglement.
New investments
have slowed down substantially and existing investments are at risk with
elongated gestations and input supply shortages affecting viabilities of
projects going onstream. Reserve Bank’s collation from banks and financial
institutions show that envisaged total fixed investment by large firms in new
projects which were sanctioned financial assistance during 2011- 12 dropped by
46 per cent to about Rs.2.1 trillion from Rs.3.9 trillion a year ago. This drop
was led by infrastructure and metals. Envisaged investment in infrastructure
declined by 52 per cent to Rs.1.0 trillion from Rs.2.2 trillion in the previous
year, with power and telecom accounting for most of this fall. Investment in
telecom sector has dried up, while that in road, ports and airports has also
decelerated sharply. More than half of the envisaged corporate fixed investment
in large projects has been coming from infrastructure since 2008-09. Its share,
however, dropped to 48.6 per cent in 2011-12 from 54.8 per cent in 2010-11.
This has had a ripple effect on the economy. Order books of capital goods
producing firms have declined as the size of the pie has reduced. Their share
in the pie has also gone down as they have been outcompeted by cheaper imports
by foreign firms.
In addition,
investment climate in power sector has been affected by rising losses of public
sector utilities. Though power tariffs has been raised by many SEBs over last
two years and several other steps have been initiated to improve the financial
health of the SEBs, drought in many parts of the country could put added
pressure on their profit line during 2012-13. A large amount of bank finance
getting locked in this sector has raised risks that a significant portion of
these loans may require to be restructured and may even become non-performing.
The exposure of banks to power sector is about Rs.3.3 trillion as per
sector-wise deployment of credit obtained from 47 scheduled commercial banks
that account for 95 per cent of total non-food credit.
Lower coal
production and supply shortages has emerged as a major bottleneck in infrastructure
sector. As much as 54 GW of new power capacity was created during 11th FYP and
another 60-75 GW of capacity may be planned during 12th FYP backed in part by
Ultra Mega Power Projects (UMPPs). A large part of this new capacity is facing
coal linkage issues. As a result, these investments are at risk due to coal
shortages. A signifi cant proportion of new capacity is without Power Purchase
Agreements (PPAs). Besides coal shortages can affect a large chunk of power
capacities in absence of Fuel Supply Agreements (FSAs). The current state is
the result of inadequate planning and coordination between power and coal
sectors, as also slow execution of coal projects. However, steps are now on
anvil to resolve the problems that have impacted the coal and power sectors.
Most of the distribution companies have raised power tariff over last one year.
Even though in many cases the extent of revision remains below what is
necessary, it would provide a positive momentum as the regulators are now seen
to be active. Contemplated revisions in FSA structures and coal pricing pooling
mechanism could also help, but all pending issues in respect of proposed new
FSAs need to be resolved without any further delay. Private sector has added to
the shortages by a dismal record of producing coal out of the mining rights
given to them. Therefore, unused mining rights need to attract deterrent
penalties. Coal production projections for the 11th Five Year Plan had to be
revised downward due to delays in obtaining clearances, land acquisitions,
rehabilitation and law and order problem. Although India has large coal
reserves, demand for coal is outpacing its domestic availability substantially.
Therefore, there is a need to resolve coal block auction issues in a fast-track
manner, so that green growth objectives can be pursued in a manner consistent
with economy’s needs.
FINANCIAL MARKETS
EURO AREA DEBT CRISIS
KEEPS MARKETS VOLATILE
Uncertainties
emanating from the ongoing euro area sovereign debt crisis, the downgrade in
the outlook of several advanced economies (AEs), and stability issues of euro
area banks amid bank recapitalization concerns, among other factors, kept the
international financial markets volatile for most of 2011-12. Cross-holding of
sovereign debt, especially by euro area banks, also translated the sovereign
debt crisis into banking sector stresses. High debt levels and stretched fiscal
space made it difficult for euro area sovereigns to re-capitalize the
banks with public
money. Concerns over economic growth also came to the fore with many AEs,
particularly in the euro area, experiencing low or negative rates of growth.
Although some AEs took policy measures to infuse more liquidity, the private
demand has remained low reflecting inter
alia deleveraging by households and tight bank lending.
Higher market
volatility was witnessed after the downgrade of the long term US sovereign debt
in August 2011. Equity markets witnessed a sell-off, with investor preference
shifting towards perceived safe haven assets. The Federal Reserve embarked on
an “operation twist” to support the US economy in the face of slow growth and
high unemployment. Developments in the euro area warranted swift action by
policy makers to avoid a downward spiral in the financial markets. The European
Central Bank (ECB) responded by undertaking two Long Term Refinancing
Operations (LTRO) that pumped in over €1 trillion. The European Financial
Stability Facility (EFSF) also increased its resources to €780 billion. Against
imminent default possibility, a bond swap was effected with large haircuts to
enable Greece to meet its obligation. The various policy measures in the euro
area in response to the crisis had implications for global financial markets
In early 2012,
global financial markets, particularly equity markets, witnessed a firm trend
due to liquidity emanating from the LTRO and other policy actions by AEs.
However, concerns over the euro area sovereign debt crisis have resurfaced in
anticipation that a change of leadership in Greece and France may be inclined
to re-negotiate the austerity-based bailout plan, leading to stress in
financial markets (Chart II.27). During June –mid August 2012, despite various
measures taken by the European Council to break the vicious circle between
banks and sovereigns, the bond yield of Spain continued to be at elevated
level. Further, recent developments like the LIBOR manipulation has also added
to the uncertainty by demonstrating the fragilities in the banking and
financial sector. The discussion paper from the Financial Conduct Authority of
the UK government “The Wheatley
Review of LIBOR”
released in August 2012, inter alia
lays out the necessary reforms for tighter governance of LIBOR,
soliciting feedback from concerned parties.
The Indian
financial markets (especially the equity and currency markets) witnessed
significant spillover from the global turmoil in addition to the domestic
growth and inflation concerns, anti inflationary monetary policy and governance
issues. The financial markets quickly reflected the shocks emanating from the
global and domestic economy.
A financial
conditions index developed in-house highlights the information content in the
financial variables monetary
transmission strong in deficit liquidity conditions for most of the year.
The monetary
policy stance of the Reserve Bank saw a gradual shift from the primary focus of
containing inflation and anchoring inflation expectations (during May-October
2011) to more growth enabling, with due cognizance of the inflationary
pressures. In line with the policy stance, 2011-12 saw liquidity conditions
remaining in a defi cit mode, with the later part of the year beginning
November 2011 experiencing liquidity deficit beyond the stated comfort level of
(+/–) one per cent of net demand and time liabilities (NDTL) of banks
Money market rates rose, reflecting monetary policy and structural
liquidity deficit
The call money
rate generally hovered around the repo rate during H1 of 2011-12, when the
liquidity deficit was contained mostly within the comfort zone of the Reserve
Bank. However, tighter liquidity conditions in H2 kept the call rate mostly
above the repo rate (although below the MSF rate). As an aberration of the
trend, the year-end scramble for funds by banks to shore up their balance-sheets
(and front-loading of reserve) caused the call money rate to move sharply above
the MSF rate on March 30, 2012. The rates in the collateralized segments of the
money market moved in tandem with the call rate, but generally remained below
it during the year (Chart II.28 b). The money market rates have declined in
2012-13 so far, with the easing of liquidity conditions, and reduction in the
policy rate announced in the Monetary Policy 2012- 13 Statement (April 17,
2012).
The speed of
transmission of monetary policy measures to the financial markets determines
the efficacy of the policy action. As noted by the working group on Operating
Procedure of Monetary Policy (Chairman: Shri Deepak Mohanty), the speed of
monetary policy transmission across financial markets was faster in a liquidity
deficit situation than otherwise. In-house empirical analysis on the
inter-linkages between financial markets and monetary policy transmission
reaffirm the finding. Asymmetry in monetary policy transmission to financial markets
in India is observed during 2005-11, with the transmission being faster and
more persistent when the liquidity is in deficit mode than otherwise.
FOREIGN EXCHANGE
MARKET
During 2011-12, the
primary concern of the Reserve Bank was to stem the volatility in the forex
market. The policy initiatives in this area were directed towards rationalizing
and simplifying procedures, and providing incentives to encourage foreign
inflows, aside from sustaining the liberalization process.
FOREIGN INVESTMENT
FOREIGN DIRECT
INVESTMENT (FDI)
In May 2011,
authorized dealers (ADs) were permitted to open non-interest bearing escrow
accounts in Indian rupee, towards payment of share purchase consideration or
for keeping securities to facilitate FDI transactions without prior approval
from the Reserve Bank. This measure aimed at providing operational fl exibility
and easing the procedures for such transactions. Further, AD banks were
permitted to pledge shares acquired under the FDI route for loans for genuine
business purpose in India or overseas. In November 2011, the transfer of shares
under the FDI scheme of Indian companies in the financial sector and/ or where
the relevant SEBI pricing guidelines were met, was allowed without the prior
approval of the Reserve Bank. Foreign investment through issue/ transfer of
‘participating interest/ right’ in oil fields by Indian companies to a
non-resident will be treated as FDI.
With prior
approval from the FIPB, capitalization of import payables and reincorporation
expenses under the FDI scheme, and also up to 100 per cent FDI in single-brand
retail trade has been allowed.
MANAGEMENT OF
FOREIGN EXCHANGE RESERVES
The guiding
objectives of foreign exchange reserves management in India continued to be
safety, liquidity and returns in line with general international practices. The
level of foreign exchange reserves has traditionally been the outcome of the
Reserve Bank’s intervention in the foreign exchange market to contain excessive
exchange rate volatility and valuation changes due to movement in the prices of
securities and of the US dollar against other currencies. Moreover, the
reserves, which are mainly built up from volatile capital flows, do not
represent surplus earnings through international trade as in the case of some
other countries and hence, are required to be held as a buffer during periods
of sudden stops and reversal in capital flows. The Reserve Bank of India Act,
1934 provides the legal framework for deployment of the Reserve Bank’s foreign
currency assets.
ASSESSMENT OF THE
BANKING SECTOR
CORE FINANCIAL
SOUNDNESS INDICATORS (FSIS) OF SCBS
SCBs remained well
capitalized, as both CRAR (14.3 per cent) and core CRAR (10.4 per cent) under
Basel-II stood much above the regulatory prescriptions Asset quality of SCBs,
which recorded improvement during 2010-
11, witnessed a
deterioration during 2011-12. In absolute terms, the gross NPAs of SCBs,
especially Public Sector Banks (PSBs), increased significantly during 2011-12.
With decline in income from securities trading and due to higher risk
provisioning, SCBs recorded a lower growth of 15.5 per cent in their net profit
during FY 2011-12.
Accordingly, ROE
of SCBs recorded a decline. Also, NIM decreased from 3.14 per cent to 3.07 per
cent for the same period. The ratio of liquid assets to total assets had also
come down during 2011-12 and stood at 28.9 per cent at end March 2012 as
compared to 29.8 per cent as at end March 2011.
PRESS RELEASE:
JULY 4, 2013
LIQUIDITY
ADJUSTMENT FACILITY: AUCTION RESULT
THE RESULT OF THE RBI REVERSES REPO (EVENING)
AUCTION HELD TODAY IS AS UNDER:
Amount (face value in Rs. Billion)
|
ITEM |
1 day Reverse Repo Auction (Sale of
securities by RBI) |
||||||
|
|
6.25 % Fixed Rate |
||||||
|
1. Bids received |
|
||||||
|
|||||||
|
2. Bids accepted |
|
||||||
|
|||||||
RBI BOARD MEETS IN
CHENNAI
The Central Board of the Reserve Bank of India met today at Chennai. Dr. D. Subbarao, Governor, Reserve Bank of India, chaired the meeting. Dr. Anil Kakodkar, Shri Kiran Karnik, Prof. M.V. Rajeev Gowda, Dr. Nachiket M. Mor, Shri Y.H. Malegam, Shri Azim Premji, Shri K.M. Birla, Prof. Dipankar Gupta, Shri G.M. Rao, Dr. Indira Rajaraman, Shri Y.C. Deveshwar and Prof. Damodar Acharya, Directors, attended the meeting. Dr. K.C. Chakrabarty, Shri Anand Sinha, Shri Harun R. Khan and Dr. Urjit R. Patel, Deputy Governors, were also present.
The Board reviewed the current economic situation and global and domestic challenges and policy responses.
The Central Board meets at least once every quarter. Apart from holding meetings in Mumbai, Chennai, Kolkata and one in New Delhi after the Union Budget, which is addressed by the Finance Minister, the rest of the meetings are held in other state capitals by rotation. The main function of the Central Board of Directors of the Reserve Bank is to provide overall direction to its affairs.
Earlier, on July 3, 2013, the Governor chaired a special State Level Bankers’ Committee meeting. The meeting was attended by senior officials of the State Government, banks and the Reserve Bank. The following decisions were taken at this meeting:
Dwelling at length on the fraudulent money collection schemes prevalent in the country, the Governor stated that although schemes like chit funds and multi-level marketing companies did not fall under the jurisdiction of the Reserve Bank, it had, as a public policy measure undertaken to create awareness about these schemes. The Reserve Bank of India has, for instance, published in 13 languages, frequently asked questions (FAQs) about non-banking financial companies. It also conducted a town hall meeting in Chandigarh on the subject in partnership with a national television channel. The Governor, then stressed on the need to sensitize police officials on this issue so that they give priority to these complaints. The Governor also emphasized the need to fast track the disposal of seized assets of the fraudsters to repay the public deposits. He informed that the Reserve Bank Staff College at Chennai would draw up a training capsule especially for senior police officials and urged the State Government to help the Reserve Bank in ramping up publicity about such fraudulent schemes through its district machinery. Since the public was generally unaware about who regulates what, the Reserve Bank has announced that the public could complain to any regulator and all regulators would coordinate resolution of complaints among themselves.
CMT REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts,
1] INFORMATION ON
DESIGNATED PARTY
No exist designating subject or any of its beneficial owners,
controlling shareholders or senior officers as terrorist or terrorist
organization or whom notice had been received that all financial transactions
involving their assets have been blocked or convicted, found guilty or against
whom a judgement or order had been entered in a proceedings for violating
money-laundering, anti-corruption or bribery or international economic or
anti-terrorism sanction laws or whose assets were seized, blocked, frozen or
ordered forfeited for violation of money laundering or international
anti-terrorism laws.
2] Court Declaration :
No exist to suggest that subject is or was
the subject of any formal or informal allegations, prosecutions or other
official proceeding for making any prohibited payments or other improper
payments to government officials for engaging in prohibited transactions or
with designated parties.
3] Asset Declaration :
No records exist to suggest that the property or assets of the subject
are derived from criminal conduct or a prohibited transaction.
4] Record on Financial
Crime :
Charges or conviction
registered against subject: None
5] Records on Violation of
Anti-Corruption Laws :
Charges or
investigation registered against subject: None
6] Records on Int’l
Anti-Money Laundering Laws/Standards :
Charges or
investigation registered against subject: None
7] Criminal Records
No
available information exist that suggest that subject or any of its principals
have been formally charged or convicted by a competent governmental authority
for any financial crime or under any formal investigation by a competent
government authority for any violation of anti-corruption laws or international
anti-money laundering laws or standard.
8] Affiliation with
Government :
No record
exists to suggest that any director or indirect owners, controlling
shareholders, director, officer or employee of the company is a government
official or a family member or close business associate of a Government
official.
9] Compensation Package :
Our market
survey revealed that the amount of compensation sought by the subject is fair
and reasonable and comparable to compensation paid to others for similar
services.
10] Press Report :
No press reports / filings exists on
the subject.
CORPORATE GOVERNANCE
MIRA INFORM as part of its Due Diligence do provide comments on
Corporate Governance to identify management and governance. These factors often
have been predictive and in some cases have created vulnerabilities to credit
deterioration.
Our Governance Assessment focuses principally on the interactions
between a company’s management, its Board of Directors, Shareholders and other
financial stakeholders.
CONTRAVENTION
Subject is not known to have contravened any existing local laws,
regulations or policies that prohibit, restrict or otherwise affect the terms
and conditions that could be included in the agreement with the subject.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.60.34 |
|
|
1 |
Rs.90.79 |
|
Euro |
1 |
Rs.77.80 |
INFORMATION DETAILS
|
Report Prepared
by : |
TPT |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
9 |
|
PAID-UP CAPITAL |
1~10 |
10 |
|
OPERATING SCALE |
1~10 |
10 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
10 |
|
--PROFITABILIRY |
1~10 |
10 |
|
--LIQUIDITY |
1~10 |
10 |
|
--LEVERAGE |
1~10 |
10 |
|
--RESERVES |
1~10 |
10 |
|
--CREDIT LINES |
1~10 |
10 |
|
--MARGINS |
-5~5 |
- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
NO |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
NO |
|
--AFFILIATION |
YES/NO |
NO |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
--RBI |
YES/NO |
NO |
|
--EPF |
YES/NO |
NO |
|
TOTAL |
|
89 |
This score serves as a reference to assess
SC’s credit risk and to set the amount of credit to be extended. It is
calculated from a composite of weighted scores obtained from each of the major
sections of this report. The assessed factors and their relative weights (as
indicated through %) are as follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend (10%) Operational size
(10%)
RATING EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit transaction.
It has above average (strong) capability for payment of interest and
principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Capability to overcome financial difficulties seems comparatively below
average. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
- |
NB |
New Business |
- |
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.