FINANCE AND INVESTMENT CLUB
Article of the Month
VOL-2 ISSUE NO. 3
Editor’s Note We are pleased to publish the fourteenth issue of ‘Arbitrage’ – Finance and Investment Club’s monthly magazine. Arbitrage aims to cover a diverse range of topics under the wide domain of Finance and Economics. Our goal is to ensure that we provide significant value to the readers through informative articles and articles on current affairs. We would like to thank all the authors for contributing their articles for Arbitrage. In the Article of the Month – ‘FinTech Revolution’, the author Mr. Pramod Gupta from SCHMRD, has done a good analysis on the evolution of Fintech industry over the years. We hope for the continuous support of our authors and readers to make this magazine a success. -Finance and Investment Club, IIM Rohtak
FINANCE AND INVESTMENT CLUB IIM Rohtak 2018-19 Parag Nawani
Siddhesh S Salkar
Bibekjyoti Roy Nandi
Naveen Kumar Aditi Patil
1. Fintech Revolution
2. Disrupt and Rise: Technology redefining finance
3. Ways to tackle NPA problem in India
4. Behavioral Finance
5. Is Indian Stock Market heading towards a crash?
6. FinTech growth in India
7. Financial Resolution and Deposit Insurance (FRDI) Bill 2017
Fintech Revolution ARTICLE OF THE MONTH
Pramod Gupta SCHMRD (2017-19) Prologue: Although the traces of FinTech evolution belong to 90s when Citigroup took an initiative in the domain of financial developments using technology and thereafter FinTech has seen spectrum of versions and developments but the story of the deep footprints of FinTech dates back to 2008. It was the Global Financial Crises (GFC) of 2008 which was the quantum leap in the evolution of FinTech into a new revolution.
provide seamless, speedy, reliable and secure services to the customers. Started with the usage of computer technology in the back-end, the FinTech is now a wide spectrum of innovations. It has expanded its horizons to Insurance services, Payments and monetary transactions, Data security, Digital cash so on and so forth by the means of IoT, Blockchain, AI, Cloud, Digital banking and the like. “FinTech: It’s money on a click.”
The post-crises decisions played a key role in the advancement of FinTech. The enactment of Jump Start Our Business Startups (JOBS) Act created the path for the FinTech startups to evolve and thrive. The Act purveyed the alternatives to the credit demand of public for their businesses. The JOBS Act eased the process of raising funds and capital for the businesses through P2P platforms. The capability to cater with alternative funding sources at time when banks were confined to lending and innovate led the emergence of FinTech and related startups. Introduction: Financial Technology or “FinTech” refers to the use of technology to deliver financial services. It is often contemplated as the wedding of financial services with the technology. FinTech incorporates the technological innovations into the financial space to
Fig. FinTech affairs
2|Page Global FinTech Landscape: According to the latest statistics obtained from statista.com, the worldwide transaction value in FinTech market amounts to USD 4256.8 billion, which is expected to grow at the CAGR of 17% between the year 2018-2022 taking the number to USD 7973.8 billion. This clearly shows the growth as well as the strength this sector holds. This
In terms of headcount, the potential users in the FinTech market are expected to be 3.5 billion which is almost half of the total population of the world. This clearly implies the acceptance of FinTech worldwide. And in order to serve this ‘FinTech’ customers, financial institutions are partnering and integrating with the FinTechs. Cases in point: 1.
• HSBC has tied knot with Silicon Valley based AI startup ‘Ayasdi’ to automate its business process, and boost and streamline the compliance and regulatory affairs. • In another ‘game-changing’ event, it has also partnered with ‘Tradeshift’ – a supply chain
exponential growth comes amidst the partnerships between traditional banks and fintech companies mostly startups. The incumbents (88% worldwide) believe that their businesses are at risk due to the swift emergence of this fintech disruptors and so in order to retain their businesses, the financial institutions are embracing the advanced and innovative ways brought in by the latter.
invoicing startup to increase the working capital by offering trade finance. 2.
JP Morgan Chase & Co.:
• In order to provide seamless service in terms of payments and fraud detection, the company has acquired Silicon Valley-based fintech ‘WePay’. • It has also acquired payments technology firm MCX to strengthen its mobile and digital wallet for Chase customers. To cut a long story short, leading-edge FinTech companies and financial innovation are changing the competitive landscape, and are redrawing the lines of the Financial Services industry with financial institutions hand in hand.
3|Page Indian FinTech Sketch:
percentages at the sides of the graph indicates the change from 2016 to 2017.
The early signs of FinTech were observed in mid2000s when FinoPay Tech and Eko India brought and implemented Banking Correspondent(BC) model with a pint of basic technology in Indian Financial Services sector. But the major disruption was prompted by the Oxigen-PayTM-MobikWikFreeCharge quartet between 2005-2010. Thenceforth, many players have burgeoned in this landscape. As of now, there are 600+ FinTech startups in India, enhancing the financial services by the means of technological innovations. As reported by a KPMG-NASSCOM report, the Indian FinTech realm is estimated to reach USD 2.4 billion by the year 2020. In terms of potential users of FinTech, the size is reckoned to amount to 662 million, nearly half the total population of country. This upsurge in the FinTech adoption by Indians has been triggered by e-commerce, mobile wallets and smartphone penetration. The transaction value, as of 2018, is USD 52 billion which is expected to grow by a CAGR of 22% amounting to USD 73 billion by 2020. The major activities moving under the fintech umbrella are Payments, Fund transfer and financial inclusion. P2P lending, Insurance, Wealth Management and the like are striding fast towards the fintech realm. Of all this, the â€˜Paymentsâ€™ sector is the fastest growing due to the large-scale adoption of mobile payments. The mobile payments industry is growing at a CAGR of 68% and it is poised to cross USD 185 million by 2020. Roadblocks: The fintech industry hands-down is on the highgrowth track but still there are a few challenges within this space that need to be addressed in the first scene: As reported by the PwC, the FinTechs and the traditional financial institutions are facing several challenges as put up in the infographic. The
Besides this, there are few more challenges that hampers the growth of FinTechs such as: 1. Low awareness
2. Absence of financial transaction infrastructure and telecommunications 3.
Security and privacy challenges
4. Data infringement malware contamination
5. Lack of collaboration between financial institutions and FinTechs 6. Regulatory barriers such as KYC, digital identity authentication etc. Future Roadmap: The future of FinTech will be, for the most part, driven by Artificial Intelligence, Blockchain, Analytics and most importantly, Mobile. Thus far, there has been a little talk on AI and Blockchain but no late than five years, these will be the key drivers of financial services. Startups in collaboration with
4|Page tech giants are investing heavily in Blockchain and the like. • Alphabet, the parent company of Google, has pumped USD 1.2 billion in blockchain startups hitherto and is leading the cohort of blockchain investors. • The second place in the cohort is retained by Goldman Sachs followed by JP Morgan Chase, SBI Holdings and Citi.
Digitization of Retail banking
Fig. Fintech activities on focus (Percentage indicates the priority of the activity)
Fig. Technological areas of interests
Closing note: The seed sown almost ten years ago has now turned into a sampling but there’s a long time due for it to become a tall tree. The financial services industry will be no more the same. The disruptors of today will transform the face of financial services sector tomorrow. The speed with which investments are getting pumped in the FinTech startups, it won’t be wrong to propound that banks will become a history in the next five years.
Fig. Emerging technologies
The segments that are going to be in the spotlight of fintech revolution in near future will be:
Disrupt and Rise: Technology redefining Financial Markets Pritam Bannerjee, IIT Kharagpur Imagine the scene of stock exchange robbery in “The Dark Knight Rises” – hundreds held hostage and billions of dollars robbed in broad daylight. This plot epitomises the impact of a weak link in the chain of financial services and underscores the need for a secure and robust system for obscuring the possibility of financial debacles. FinTech, the technology that is disrupting the status quo, is driving efficiency and enabling innovation in the financial markets. This enabler is built around the primary themes of convergence of other industries into financial services, and a transformative journey which involves leveraging of disruptive ideas like the Internet of Things (IoT) and blockchain technology.
AR / VR
Digital Security journey in the extended ecosystem Advanced Analytics – Customer insights to the next level
Intelligent Automatio n – new co-worker for digital age
IoT – Door to the customer’s value chain
Componen ts of FinTech 
Banking APIs – Time to market, Partner Integration
Platforms – New ways of growing business
Blockchain – Impacting centralized business models Cloud – Agility, cost, security, compliance
IoT in financial markets In this context, technology-driven by sensors and web, collectively termed as the IoT, has been the front-runner in changing the landscape by disrupting the very way of conducting business,
accounting for nearly 28.5% revenue growth. With IoT expected to enable nearly $11 trillion economic growth, its applicability in the financial market is no longer a sci-fi abstract.
IOT REVENUE OPPORTUNITY 
Manufacturing Other 44%
Manufacturing 23% Banking 4% Retail 8% Healthcare 8%
Retail Healthcare Transportation Utilities Other
With the early signs already there with IoT in banking, the key interest lies in how the banks leverage the availability of the huge volume of physical and observational data to create opportunities in better understanding the creditworthiness of customers. The ability to continuously monitor asset conditions with the help of sensor nodes mounted on physical items will allow banks to project timely lending services. With Barclays opting for smart piggy bank services, it is evident that IoT enabled services will be used by the leading banks to attract the young audience by making them understand the value of money in a cashless society. The launch of pay bands in the form of smart wearables further underlines the growing impact of IoT as an alternative option to facilitate contactless payment systems.
IoT also promises to change the way how the insurance sector functions, by enabling continuous engagement and positive relationship between the policyholders and the insurance company. With the use of IoT, the focus is shifting from a restitution-based insurance policy to a preventative one, by using real-time data to mitigate risks. The availability of granular data will lead to the unbundling of insurance offerings to focus more on need-based insurance at a reduced premium. Beyond personal insurance coverage, the commercial insurance sector also stands to gain from IoT implementation, permitting the providers to gauge uncertainties in real-time.
Data – Information led real-time decision making
Inclusion – solutions for all with lower entry barriers
Acquire – Simplified KYC for mass adoption
IoT enabled bank operating model 
Cost Cutting – Marginal cost of transaction reduced to almost 0
Ease of access for everyone Interoperability across all systems participating in a transaction
Implications of IoT for Insurance Industry  The use case of IoT implementation in the asset and wealth management industry, as well as capital market, is showing a strong positive trend, with clients demanding enhanced digital experience in terms of transparency and access, beyond the simple features, functions and tools. Analysis of investment patterns based on data encompassing oneâ€™s action and inclination collected through the IoT network is a primary example of how portfolio managers can leverage the power of digitalization to offer customised experience around data. Keeping up with the trend of mobility â€“ the modern mantra in wealth management to develop new channels for enhanced customer relationship, retention and potential profitability â€“ firms are making use of the live data flow to automate fund allocation based on risk resilient models. Machine learning algorithm running on real-time data collected over the sensor nodes is also promising to open up new avenues in the capital markets, with better prediction of the dynamic market behaviour, thereby enabling the formulation of comprehensive trading strategy devoid of human intervention.
Internet of Assets: Improvement in Asset Management by % with IoT  55% 28%
The real estate sector also stands to benefit from the IoT implementation, as it enables factual and transparent property valuation and easier transaction proceedings. Furthermore, it is the internal risk management within the financial institutes which can be better handled using IoT solutions, allowing to continuously monitor the vulnerable operational issues that can eventually lead to fraudulent activities or lacklustre performance from employees.
BFSI: % of IoT Spending by Core IoT Business Area  32%
30% 22% 16%
Premises Monitoring Supply Chain Monitoring
CAGR (2013-20) of IoT sensor deployment by financial categories  98% 71% 34%
Commercial Real Estate
Blockchain in financial markets According to PwC Global FinTech Survey 2016, 56% managers have already identified the relevance of blockchain technology in the financial spectrum. The blockchain in simple terms is a ledger that is distributed on several nodes. The system has no central authority, instead, it is a shared record of transactions distributed over a vast network of users. This distributed ledger has brought about a fundamental evolution in trust management among interacting parties, ranging from clearing houses to trading houses, settlement centres to the rovision of tax receipts made through government.
10 | P a g e Creation of Electronic Message i.e. transaction details Network replicates record of verified transactions
Sent to distributed nodes with unique crypto signature
How Blockchain works? Block added to all distributed ledger copies
Economic race to be first to validate transaction
Confirmation broadcast to rest of network
The biggest gain in terms of financial uses of blockchain that has kept the large banks excited is maintaining track of trades, in bonds or stocks, and making sure that payments are made properly â€“ eventually leading to the abolishment of the current complex process involving banks, traders, exchangers and clearing houses and making sure that blockchain is used to log ownership data to get the work done in minutes. This use case is expected to save banks $20bn. per year, as it promises to free up huge fund currently tied up waiting for trades to be processed, and even streamline cross-border remittance by 2-3%.
Bank spending on blockchain (USD Mn.)  400 310 205 80
Blockchain technology will also lead to reduced risk in this sector, ensuring easy traceability of transactions, which in turn enhances real-time accolade and reward management for banking and
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insurance industry through a 24*7 feedback mechanism. The system of distributed ledger also promises to significantly reduce online fraudulent activities which cripple 45% of financial agents yearly. The blockchain architecture consisting of series of data blocks, each recording a batch of transaction, electronically chained together through advanced cryptography, makes it particularly robust against hacking attempts. This disruptive technology is also capable of cutting down on compliance cost, as it eases up the online identification process, allowing the re-iterative use of verified data.
Value ($Bn.) generated by blockchain in financial use cases  Identity Fraud
KYC / AML management
Repurchase agreement transactions (repos)
Cross-Border P2P Payment
Cross-Border B2B Payment Trade Finance
The insurance sector will also be positively impacted by the blockchain technology, through a shift towards digital contracts running on the de-centralised ledger network. These smart records are capable of automatically bargaining and implementing statutory specifications, and thereby speed up the claim settlement process between the involved parties without mediator intervention. With NASDAQ venturing into this disruptive technology, it is clear that blockchain will redefine trading experience and the capital markets. Riding on the success of enhanced trade efficiency, the cryptocurrencies powered by blockchain technology is turning out to be an exclusive crowdfunding instrument. Moreover, the capabilities ranging from a decentralised stock exchange to the eradication of brokerage service, increased scalability to an augmented performance by tackling redundancy is greatly propelling share dealings.
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Trade Finance on Blockchain  Another promising use case of blockchain technology is the advent of cryptocurrencies. The bitcoin blockchain, operated by bitcoin miners who organise and secure a tiny fraction of bitcoin transactions into the blockchain, is leading a currency revolution across the globe. With countries like Canada set to try out digital currency, blockchain technology showcases a wide prospect in transforming the financial business models.
Existence in absence of trust Remote independent writers
5 key criteria for blockchain 
Economic benefit for participants
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AI in financial markets Robotic Process Automation will reduce the manual paperwork catapulting customer delight through a faster turnaround of financial services. This will also change the pattern of employment in the industry as tedious clerical work would lose human dependency. Not only will ML impact the simpler jobs in the financial sector, it obtains the capacity to replace partially, if not totally, the advisory roles of financial consultants. Robo-advisor uses ML algorithms for portfolio management tailored to clientâ€™s needs. HDFC Bank uses its chat-bot, Eva, not only to make life easier for its employees, but also for providing seamless service to all its customers enhancing loyalty and advocacy. The launch of â€œThought Factoryâ€? by Axis Bank which is aimed to innovate AI solutions for banking operations underscores the degree of influence of technology in this industry.
Focus on Emerging Technologies in Financial Sector  19%
Biometrics & Identity Management
Artificial Intelligence 0%
% of large companies that identified these emerging technologies as the most relevant to invest in within next year Financial Institutions
The magic of AI is also being utilized for performing sentiment analysis using the social media outlet to enable the financial services including high-frequency trading and hedge funds. A further proliferation of this asset will be the algorithms developed in devising trading signals for making investment decisions. Although a double-edged sword at times, this technology can only improve for the betterment in the future. The usage of AI for credit risk analysis and customer churning forecast have released newer avenues of operation in the financial arena.
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Technology •Improvements in computing power, data availability, algorithms, costs etc.
Financial sector factors •Availability of infrastructure and data to apply new techniques
•Potential for cost reduction, revenue gains, improved risk management
•Race with other financial institutions and firms
•Prudential regulations, data reporting, best execution etc.
Financial adoption of AI and machine learning  A further modification of the tools may lead to bots as relationship managers and advisors on matters related to taxation and retirement. It has also been claimed that bots, trained in market pattern study, may contribute to about 80% of the daily stock trading amount by buying and selling stocks in nanoseconds.
Financial scopes where AI & Machine Learning can be introduced in the next 3 years  49%
Credit Approval Process
KYC and Anti- Regulation Administration Money and Laundering Compliance
Industry 4.0 is here, and the greatest leap in advancement will be in the field of FinTech. Yes, money still cannot be planted in fields, but certainly, money can be motioned through sound investment for improved velocity and accelerated growth. The progress of the financial sector is indispensable for overall economic growth. Considering the path of progress chartered on the wheels of technology, we can certainly be hopeful for a fruitful ride.
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WAYS TO TACKLE NPA PROBLEM IN INDIA Avik Mandal, IIM Lucknow
Introduction: A Non-performing asset(NPA) is defined as a credit facility in respect of which the borrower has failed to make interest or principal payments for 90 days. In NPA the interest and/or instalment of Bond finance principal has remained ‘past due’ for a specified period of time. It not only effects the balance sheet of the banks but also effects the economy. The following impacts are created due to high NPA: Profit margins of the banks go down and they charge more interest rates to maintain the profit margin As less money is available, the banking sector fails to invest in high NPV projects which impacts the GDP of a country Due to less investment, unemployment increases. Investors do not get desired returns To follow best practices & maintain transparency RBI has defined NPA (in March 2004) in the following ways:
In case of agricultural purpose if the loan is overdue for more than 2 harvest seasons Interest/Loan/bills overdue more than 90 days In case of cash credit if the account remains out of order for a period more than 90 days Non submission of stock statement for more than 3 quarters in case of cash credit policy
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Types of NPA: Depending upon the period of non-performance NPA can be classified into three categories:
Sub standard assests
NPA less than 12 months
NPA more than 12 months
Loss assests Loss is identified but amount has not written of fully or partially
Current situation in India: As per the data from RBI NPAs were only 3 percent of gross advances of all banks in India in 2013. But in 2017 1st quarter it has grown to 10.21 percent of gross advances with 829338 crores. For private banks NPA grew from 2 percent in 2013 to 3.5 percent in 2017. In case of nationalised banks NPA grew from 2.9 percent in 2013 to 14 percent in 2017. The NPA data of the last 2 years & the growth rate are as follows: Table 2: Growth in NPAs(q-o-q)
From the below bank wise data of NPA of June 2017 the following observations can be made:
17 | P a g e Table 3:NPA position of different Indian Banks
State Bank of India has the highest share of NPA around 22.7% during the quarter The top 5 banksSBI,PNB,BOI,IDBI,BOB accounts a share of 47.4% of total NPA with an amount of Rs.393154 crore. In the list of top 10NPA holders ICICI bank is the only private bank. It shows that the issue is more prevalent in nationalised banks compared to the private banks. ICICI Bank and Axis Bank are the only private sector banks in the top 15 with a combined share of 7.9% in the total NPAs
Table 4:NPA vs Total Debt Ratio of different Indian Banks
From the NPA to total debt table it can concluded that: The top 20 banks with highest NPA to debt ratio are public sector banks. IDBI bank has the highest NPA to debt ratio of 24.11%
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ICICI bank has the highest NPA to debt
ratio among private sector bank of 7.99% ď‚ˇ
YES Bank is the only bank with a ratio
of just less than 1
Reasons for the rise in NPA in recent years: In India almost 10% of the loans falls under the category of NPA. It means the 10% of the total loans taken are not repaid back. When restructured and unrecognised assets are added the total stress would be 15-20% of total loans. Not only this NPA has increased significantly in the last 5 years. This bad performance is not a good sign and can result in crashing of banks as happened in the sub-prime
United States of America. The main reasons of this is stated below: External Factors
Government Policy Changes
Time & cost overrun duringPolitical pressures project implementation stage
Pressures due to liberalization
Investment in new projects
Inability to reduce funds
Exchange rate fluctuations
Inefficiency in bank management Fund mismatching while issuing loans
&Following government directives while issuing loans
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How to tackle NPA Problems:
NPA Issue solving NPA problems can be solved in mainly 2 ways:
Preventive Actions: The following preventive actions can be taken to prevent NPAs:
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Proper risk manag ement
Strengthen ing KYC
Loan restructuri ng schemes
Rotation of staff
Sector wise issue
Audit & inspection
Strengthen ing supervisor y capacity
Penalise for wrongdoin g
Strict NPA rules
Restructur ing of banks
RBI more power Checking of political schemes
use of data analytics
Strengthening KYC: The objective of highly leveraged financial institutions such
of KYC guidelines in banks is to better understand
as banks to provide badly needed venture capital; it
their customers and their financial dealing. It
implies that financial systems need more than banks.
prevents the banks from being used, intentionally or They also provide greater stability to financial systems and alternative funding sources for unintentionally, by criminal elements for money laundering activities. This helps them manage their borrowers. risks prudently.
Proper risk management &
credit management systems: Risk management implies significant limits on the ability
Loan restructuring schemes: RBI
has over the past few decades come up with a number of schemes such as corporate debt restructuring (CDR), formation of joint lenders’
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forum (JLF), strategic debt restructuring (SDR)
pointed out that the NPA problem has to be tackled
scheme and sustainable structuring of stressed assets before the time a company starts defaulting. (S4A) to check the menace of NPAs.
RBI more power: The Banking
Audit & inspection: Banks must
Regulation Act may be amended to give RBI more
conduct frequent audits & inspections of the
powers to monitor bank accounts of big defaulters.
companies to gauge the current financial condition of
The amendment in the banking law will enable
setting up of a committee to oversee companies that have been the biggest defaulters of loans. RBI wants stricter rules for joint lenders’ forum (JLF) and oversight committee (OC) to curb NPAs.
Sector wise issue: If we go for the
sector wise data of total debt issued and gross NPA we can see that Metal, Mining, Construction & Gems/Jewellery are the sectors in which highest
Strict NPA rules: The government investment is done & they are the highest. So, banks
has over the years enacted and tweaked stringent
must evaluate the industry properly before giving
rules to recover assets of defaulters. The
Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act or Sarfaesi Act of 2002 was amended in 2016 as it took banks years to recover the assets. Experts have
Checking of political schemes: It
is often observed that due to some political schemes banks have to issue high value loan to the
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companies. This often creates high NPAs. So, banks Bank who was bribed by the promoters of Bhushan must evaluate these schemes properly before giving Steel was in jail for barely a few months and has not loans.
been convicted as yet.
Proper use of data analytics: Now
a day’s banks are using data analytics and predictive capacity: Banks must ensure proper supervision to data mining to evaluate the companies before giving all the officers so that there is no issue of partial loans. This is highly beneficial because by data treatment while issuing loans. analytics the bank is able to predict the future value of the firm.
Rotation of staff: Improvements to
HR practices can help mitigate egregious behaviour
Restructuring of banks: The
like frauds. For instance, PSBs tend to man the
measures could include a combination of capital
business verticals with the brightest talent and less
raising from the market, dilution of government
competent staff in the inspection and supervision
holding, additional capital infusion by the
roles. If officers are rotated in these roles, this could
government, merger based on strategic decision and not only strengthen the supervision of banks, it sale of non-core assets. would also mean that staff on the business
Penalise for wrongdoing:
Although vigilance mechanisms exist, lax enforcement means that wrongdoing is rarely penalized. For instance, the Chairman of Syndicate
development side have experience in supervision and inspection and will therefore self-regulate better.
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Curative Actions: The following curative actions can be taken to prevent NPAs:
Rephasement of loans
Debt recovery tribunals
Acquisition of sick units
Restructuring of banks
Re-phasement of loans: It is a
Using Lok Adalats
Encouraging acquisition of sick
practice that involves restructuring the terms of an
units by healthy units: Government and banks
existing loan in order to extend the repayment
should encourage acquisition of sick units by healthy
period. Debt rescheduling may mean a delay in the
units so that loans can be returned and NPAs can be
due date(s) of required payments or reducing
payment amounts by extending the payment period.
Pursuing corporate debt
Using Lok Adalats for small &
doubtful loans: Banks can go to Lok Adalats for
restructuring: Corporate debt restructuring is the small & doubtful loans. reorganization of a distressed company's outstanding obligations to restore its liquidity and keep it in business.
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Approaching debt recovery
tribunals: Banks sometimes must approach debt recovery tribunals for loan recovery.
Recovery action against large
NPAs: Strong rules must be there so that it is easier for the banks to get the high value loans back.
Conclusion: Looking at the giant size of the banking industry, there can be hardly any doubt that the menace of NPAs needs to be curbed. It poses a big threat to the macro-economic stability of the Indian economy. An analysis of the present situation brings us to the point that the problem is multi-faceted and has roots in economic slowdown; deteriorating business climate in India; and the operational shortcoming of the banks.The government can’t be expected to rescue the state-run banks with taxpayer’s money every time they fall into a crisis. But, the kind of attention with which this problem has been received by policymakers and bankers alike is a big ray of hope. Right steps, timely and concerted actions and a revival of the Indian economy will put a lid on NPAs. Prevention, however, has to become a priority than mere cure.
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Behavioral Finance Yash Gupta, GLA University
BEHAVIORAL Finance………! What it is? Is it the sister of behavioral economics or belongs to different family.Whenever weauscult finance….NIFTY: SENSEX: NIKKEI...Time value of money...GOLDMAN SACHS……BANK OF AMERICA:SBI……CAs ,CFO , CFA starts coming in our brain, Does the finance field restricted to principles only OR there is any space of psychology & emotions in the world of finance. Let’s commence the investigation……
“Mumbai is busy every day, so we know that everyone is rational.” In very simple words it is the Science behind irrational decision making. It amalgamates social and psychology theory with financial theory to comprehend how price surges and slashes of securities in the stock markets occur freewheeling of any corporate conduct. In 1759 Adam Smith mentioned investors make more decisions on basis of psychology rather than rational analysis. It states that homo sapiens are not mathematical equations. The field of study stands in stark antithesis to the efficient markets hypothesis. Admirable work incepted in 1979 by Daniel kahneman & Amos Tversky in this field. Conventional economics & finance says humans are rational “Wealth maximizers” and consider them a Homo Economicus but the situation is somewhat distinct in bona fide world, for instance recently how many people invested in bitcoin on the basis of rational analysis or in purchasing of land many acquired on the present trends or purchase lottery ticket in the hope of hitting big jackpot.
Start boll rolling financial theory focal point on the trade-offbetwisk risk and return. However, behavioral finance commend investors are overconfident in furtherance of to making gains and oversensitive to losses. Let’s begin the journey with the causations. Anchoringresults moot decision due to basis of illogical references. It is fairly accepted in context where people are barter with brainchild that are neoteric and modernistic.au-corant instance for this is people had invested in bitcoin in the basis of image created by few agog investors. Now story continues to Mental Accounting which concerns to the mindset of people who distribute their money into apportioned accounts based on a multiplicity of subjective gauges. The linchpin to concede for mental accounting is money is commutable regardless of its antecedents or aforethought use, all money is the same. It is the habit of human beings treat money distinctively based on its source. For instance some investors apportioned their investments betwixt a safe investment portfolio and a speculative portfolio in order to anticipate the negative return. Now let’s move the vehicle to another
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causation of this field. Which are confirmation bias and hindsight bias? It is believed that "seeing is believing”.Confirmation Bias which says it can be abstruse to rezvendous anything without having a prejudice conception. The first impression pays more focuses to information that abutment their opinions, while ignoring the rest. which not matches with our opinions Result of this causation is Franz as focal point on brass tacks and facts that supports original idea rather than argumentation points.Hindsight Bias which isAnother prevalent way of seeing bias is happen in context where a person believes (after the fact) that the onset of some older event was anticipated and completely apparent, whereas in fact, the event could not have been adumbrate.For investors in world of finance , the hindsight bias is a accumen for one of the most potentially hazardous mindsets that an investor or trader can have is overconfidence concern to investors' or traders' unfounded assumption that they having higher stock-handling aptitude. Herd behavior which is already known point. It causes due to the societal load of compliance. It make them assuetude sociable and have a primary desire to be acknowledged by group, alternatively branded as an outcast.It had diplayed in the late 20th century as venture capitalists and were agitatedly investing corpus of funds into online computer network companies, even though many of these dotcoms were not economically sound, that’s why the effectual advocate is to always do rational analysis before following any au-courant trend. Now turn your vehicle to Overconfidence causation. Confidence means sensibly trusting in one's aptitude, while overconfidence generally means an overly
optimistic evaluating of one's knowledge or curb over a situation which is a straight different b/w them. Overconfident investor is only a trade away from a very humbling wake-up call. “Past track record is not an gauge of future performance” How can we forgot about Availability and Overreaction bias,whenever some straits comes out about a company, everyone attempts to get out of the sinking ship as quickly as soon as possible . This causes the stocks to slashes to alarming levels. But in practical the straits may not be that bad to cause such a huge percentage slashes in prices. This works equally well for the good news too. All investors want to get in the stock based on the au-corant, neoteric and drive up the prices more than its value. This is wholly contradictory to the Efficient Market Hypothesis.Investors overreacted to the bad news and drove the stock prices down a lot. Similarly they overreacted to the good news and drove the `stock prices all the way up. Last but not the least,Prospect theory which says if a investor were given two alike alternatives, one stated in terms of attainable gains and the other in cinch losses, people would choose the first one- even when they achieve the similar financial extreme outcomes. & negative financial results have more emotional appulse than an agnate amount of gains. Let us say, the quantity of satisfaction gain from receiving $60 should be equal to a situation in which you gained $100 and then lost $40. In duo context, the final outcome is a net gain of $60.In addition to this, it also illustrates the happening of the disposition effect, which is the assuetude for investors to clasp on to going down stocks
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for too long and clinch winning stocks too soon. The probable approach would be to hold on to leading and profitable stocks conducive to additional gains and to clinch going down stocks in order to prevent amplifying bereavement.
Adam smith has very rightly said that â€œAll money is a matter of beliefâ€?.
Whether it's mental accounting, irrelevant anchoring or following the herd, probabilities are possible that we all have been guilty for minimum biases and moot behavior is the result of that irrational decision. Hopefully, our future financial and economic decisions will be more analytical, realistic, fruitful and productive as well which makes a work of behavioral finance successful.
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Is Indian Stock Market heading towards a crash? Pandi Selvam A, Mahalingam K IIM Kozhikode
From Crest to Trough:
The place that provides an opportunity of an
NIFTY has experienced a whooping growth
ownership of huge billion dollar firms to a
of 694.85(8.49%) points whereas SENSEX
common citizen in the country, the same
has grown by 2470.5(7.3%) in the month of
place that provides an ideal breeding ground
January whereas the same for the calendar
for future icons like Jhunjhunwala, Damani-
year 2017 recorded a rise of 2344.9 and
Stock market. As the Oracle of Omaha
rightly said it is a device for transferring
conducted by AAII on Jan 3 concluded that
money from the impatient to the patient. The
59.8% of polled investors were bullish about
so-called money transferring device has been
the market. This is the highest level in about
spread across the globe and has been going
7 years and significantly higher than the
through peaks and troughs since the start of
average of 38.5%. The net investment from
2018. In general, bears dominated the market
FPIâ€™s in India grew tremendously to around
10 days before the announcement of Indian
Rs.2 Trillion during the calendar year 2017
Union budget during the last four years but in
Rs.-23079 trillion in the previous year .
contrast bulls took over the Indian stock market for almost entire pre-budget season after the economic survey and the IMF predicting India to be the fastest growing economy in the world [1,2].
But the revised target of fiscal deficit to 3.3%, introduction of Long Term Capital Gains Tax and the rise in US bond yield has created a negative sentiment among the FPIs. The duo of existing Security Transaction Tax (STT) and the new LTCG tax makes India as
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the highest tax imposing nation among the emerging markets in Asia
industry, aluminum had an impact as the
. Such measures
industryâ€™s market capitalization fell by 6.5%
from the government will result in investors
whereas the share of major firms like JSW
shifting to other emerging markets due to
steel, SAIL, TATA steel fell in the range of
cost concerns. In addition, the US bond
10-14% at a time when the Indian stock
yields has recorded to a three year high
indices were experiencing the rock bottom
exacerbating the negative concerns about
level of the year so far.
Indian market among the FPIs. These events caused the SENSEX falling from 35906.66 to 33703.59 and NIFTY to drop approximately 700 points during the month of February
Banking Sector Weaknesses and Impact
The reduction of corporate tax in US from
In addition, weaknesses in the key structural
35% to 21% was another blow to the Indian
facet of Indian economy viz. Banking Sector
market. The measure of tax cut implies
doomed the investor expectations. The ability
higher earnings per share for the US investors
of banking sector to extend access to credit is
in their domestic market. This is expected to
vital for the expansion of economy. This is
bring down the share of FPIs, the second
substantiated by the positive co-relation
largest investment community of Indian
coefficient seen between the market indices
market. Adding to the woes, the introduction
and the bank indices in both BSE and NSE
of tariffs on metals such as iron and steel
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SENSEX vs S&P BSE SENSEX 40000 35000 30000 25000 20000 15000 10000 5000 0
S&P BSE BANKEX
NIFTY VS NIFTY BANK 30000 20000 10000 0
The highly increasing amount of Non-
companies which in turn will decrease the
Performing Assets (NPA) of banking sector
value creating opportunities of companies.
has proved to be a barrier for the banks to lend as loans worth Rs.200000 crores is expected to head for bankruptcy court. Also, the stressed loan contribution with overdue for 61 days will spike beyond 16% of gross NPAâ€™s when compared to the current state of 10.3%. The inability of banks to lend will decrease
The banking sector has the capability of denting other domains of business as they play a key role in the foreign trade in a global economy. A negative mark on the credibility of these banks affects the international trade as well as loss of trust of domestic investors. For example, the fraudulent activities of public sector banks such as the fraud in Punjab National Bank with the jewelry
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businessman Nirav Modi dented the trust
mutual funds has shot up since then. The
between banks and diamond traders. Even
domestic inflows to the mutual fund market
have hit a record high of Rs 1.6 trillion so far
for the current financial year with a monthly
Board of India, the recovery of NPAs seems
average share purchase of Rs 117 billion[8-
to be a long term goal while considering the
the smart investor, business standard,7th
magnitude and complexity of NPAs.
march 2018]. The contribution of equity
through New Fund Offers (NFO) from
Is the marked still overpriced?
mutual fund sector has more than doubled to
The current scenario is an overpriced market
15% when compared to a level of below 7%
and as per experts view the market can be
in the previous year. This increased level
expected to undergo a correction of 5-10%
of domestic inflows will increase the tally of
retail investors and reduce the dependence on
. The SENSEX rose by 38% since the start
of 2016 while the EPS will be expected to
grow by 16% from FY16 to FY18. This was
expected to bring more taxpayers into the tax
evident across all markets as the MSCI world
bracket with revenue increasing to Rs.86706
index increased by 27% whereas the EPS
crores in the month of December after initial
climbed by only 10% in the span of 2 years
hiccups and also the direct tax payment
from 2016 to 2017.
has been increasing after the waves of
complete story of stock market?
The implementation of GST is
demonetization. All such disruptions are a part and parcel of an economic cycle. In between 1897 and 1949 the S&P Composite
All these factors will result in a further
Index has witnessed ten complete market
downfall of market in the short term. But as
cycles comprising of the rock bottom bear-
Warren Buffet, the worldâ€™s third richest man
market lows and bull-market highs. But as
and a global iconic investor rightly conveyed
Warren Buffet rightly believes the ideal focus
in his letter to his shareholders 2018, a huge
of investment should be on long term and
success as an investor will demand the power
such a dipping market opens the doors for an
to withstand the downtimes of the market.
With banks lowering the interest rate of Fixed Deposits, the stock purchases towards
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fluctuate over the years. The availability of
propounded by Benjamin Graham also helps
daily prices of stocks in stock market makes
in reinstating the need for long term
the investor enticed to buy/sell them. A true
orientation for an investor rather than short
investor will pay attention to day to day
term gains. Every investor who owns
prices only to the extent that fits to his book.
common stock must expect to see them
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Source: CNBC century, Dow Jones Industrial Average From the graphs, it can be inferred that the Sensex from 1979 to 2018 and S&P from 1929 to 2018 has short term dips but in the long run markets will climb up. In the last
(DJIA) has gone from 68.13 in 1900 to 25,335.74 in 2018 despite of the 2 World Wars, Great Depression 1929, Sub-prime Mortgage crisis 2008. Hence businesses will do fine overtime.
“In terms of what’s going to happen to stock market prices in a day, week, month or year I have never felt that I knew it and I have never felt that was important. I will say in 10, 20 or 30 years stocks will be a lot higher than they are now.” - Warren Buffet
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FinTech growth in India Bhavya Khurana, IIM Indore (2017-19) Government and Regulators Overview
In India, since the crowning of Mr. Narendra
With the advent of liberalization in the Indian
Modi, the growth of the Fintech sector has
economy, India started moving towards
been phenomenal. With the foundations set
Fintech with the introduction of technologies
with the Unique Identification Number(UIN)
like NEFT and MICR that transformed the
based Aadhar and a vision to make India a
banking industry and factored in the growth
digital economy, the scope for growth of
of Indiaâ€™s GDP. Mimicking the trends in the
Fintech has been phenomenal. In the process,
global economy, India has become a hub of
Indian currency was demonetized which
startups in the sector occupied by players like
acted as a catalyst for the move towards
Paytm, Mobikwik, Faircent etc. and trying to
broaden its scope since 2005. Since 2010,
payment banks, financial institutions and
India has started witnessing developments in
various segments apart from startups
KPMG India has recognized 8 pillars of the
RBI has set target is for the financial
inclusion penetration to reach 90% by 2021.
Government & Regulators (b) Investors (c)
The push for financial inclusion from the
Financial Institutions (d) Universities and
Government and the Central bank helps
research institutions (e) Incubators and
FinTech lenders, as digital lending platforms
Innovation Labs (f) Tech vendors (g) Users
can target customer segments that were
(from corporates to retail customers) (h)
Startups. In this article, we will examine the
An indirect push in this regard came in the
role of these important sectors in pushing the
Fiscal Budget of 2016 when Narendra Modi
growth of Fintech in India.
launched a Rs. 100 billion fund to support the
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startups and provide them with tax breaks in
holds 20% in the incubator which will invest
the first 3 year operations. The NASSCOM
in early stage start-ups.
Service Companies) predicted a growth rate
Investment Group that focuses on making
of 40 percent for startups in a year in 2017
long-term strategic bets on fast growing
and the same was easily achieved.
technology companies, had set its sights on
Indian Fintech startups since 2016.
Apart from the venture capitalists and private
equity houses the growth of Fintech has
In the past year, with the launch of ‘BHIM’
facilitated entry of some non-traditional
and the advent of UPI, digital payments have
players whose existence in the sector could
been fast-tracked with a Virtual Payment
not have been predicted in the past.
address and has reduced the need to
SBI Chairman Arundhati Bhattacharya has
remember complicated account numbers and
setup the ‘IT Innovation Start-up Fund’ will
IFSC codes to make the payments. In India,
consider assistance of Rs. 200 crores to any
around 29 banks have become UPI enabled
Indian-registered company operating in the
with around 19 having their own UPI based
area of banking and related technology (up to
apps to facilitate payment. Even Google India
₹3 crores per company). She believes that the
has seen UPI as a growth driver and has
new-age customer lives in the ‘GAFAA’ —
entered the market with its app called ‘Tez’.
an acronym for Google, Apple, Facebook,
Also, the market leaders including ICICI
Android and Amazon — realm, in which the
Bank, HDFC Bank & SBI have started
organizing start-up contests to spot the best
smartphones and Fintech is the best way to
innovators in the FinTech space and adopt
get access to these customers.
YES Bank has taken it up a notch by Recently, Reliance Industries has set up a
innovating into the ‘Blockchain’ technology.
It has become the first bank in India to
successfully implement innovation in Supply
partnership with Israel-based start-up crowd-
Chain Finance using Blockchain and API
funding platform Our Crowd, Motorola
Banking. YES BANK collaborated with IBM
Solutions. RIL has invested $ 25 million and
to use their Hyperledger fabric and used a
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Smart Contract. The ‘YES ENGAGE’ is a
Incubators and Innovation Labs
Many key incubation centers have come up
engagement and productivity management,
in the Fintech space backed by strong support
developed to help YES BANK sales teams
and investment from industry leaders like
plan and update visits done by them through
a completely mobile tool. This transparent
sales monitoring process makes it easier for
One of the most active incubation center in
the frontline workforce to plan their day-to-
news recently is Microsoft Ventures, which is
day activities. The bank has won the
a corporate venture capital subsidiary of
‘FINNOVITI Award 2018’for the same.
Microsoft. Founded in March 2016, its
Universities and research institutions
mission is to be an active, strategic partner at
key stages of a startup's growth. It supports
producing ‘world class entrepreneurs’ rather
not only company objectives, but customers,
than securing placements for the students has
partners and the ecosystem more broadly.
been on a rise. In the upcoming years, IIT
and IIM now has a functional E-cell which
IBM has emerged as the leading technology
helps student-run and other startups to get
vendor catering to the needs of various
funding from venture capitalists. The CIIE at
clients. New initiatives in the area of
IIM Ahmedabad, SINE at IIT Bombay, IITM
Incubation Cell at IIT Madras are some of the
structured and unstructured data and turning
examples of famous incubation centers which
that into knowledge to enable acquisition and
have been able to pull in funding’s for the
retention of new customers (b) Blockchain
using the Hyperledger framework and smart
Industries Development Bank of India (SIDBI)
contracts were the major themes explored for
has tied the knot with IIM Lucknow for
the growth of fintech in the future.
nurturing technologies impacting financial
This does not mean that innovation in the
inclusion with their incubation center SCI-FI.
industry is restricted to the big players like
Also, almost all prominent B-schools and IITs hold entrepreneurship summits to pitch their ideas to the leading private equity firms in the industry.
IBM. Ezetap is a mobile based payments company that has collaborated with SBI and aims to change the landscape of electronic payments in emerging markets. It has
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developed a Chotu-ATM (small -ATM)
internet users which has recently crossed 480
device for small ration shops which can be
million users in December 2017.
used to make POS payments and withdraw
upto Rs. 1000 per day in cash daily.
Also, HDFC Bank has been collaborating
consumers and Fintech boom has acted as
with Chillr for payments, BankBazaar for
catalyst for the increase in number of startups
lending, Money View for mobile banking,
in the field. Presently, India boasts of over
Niki for chatbot on Facebook messenger and
600 start-ups in Fintech that belong to
Ultra Cash for payments using soundwave
various segments and the same is expected to
technology and utilizing this gamut of
grow with the introduction of a focused
accelerator program by local and state
partnerships with small vendors.
governments and banks in collaboration with
the Startup India vision by the Centre.
The users of the services offered have been
growing at a phenomenal pace. In February
With the Indian population crossing 1.3
2017, post demonetization, the number of
billion people, not even 2% of the consumers
subscribers of Paytm crossed the 200 million
have become active users of Fintech-based
mark doubling its base in less than 2 years.
technologies. This goes to show the future
This has been supported by the growing
growth potential of Fintech in India.
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FINANCIAL RESOLUTION AND DEPOSIT INSURANCE (FRDI) BILL 2017 Arjun Sankar N, Priya K.N.L T.A.Pai Management Institute, Manipal a fresh set of concerns and anticipation
Introduction Every bill or law proposed in our country makes waves even before being passed in the two houses of the parliament. The Financial Resolution and Deposit Insurance (FRDI) Bill of 2017, is no exception. The financial
among everyone. The Bill establishes a Resolution Corporation to monitor financial firms,
corrective action, and resolve them in case of such failure.
sector and particularly the banking sector of
Financial institutions work closely all the
India are undergoing a phase of restructuring
over the world. Their activities have a major
under the BJP government. Various issues
impact on the countryâ€™s and global economy
like the NPA and the insolvency cases have
at large. The Lehman Brothersâ€™ crisis in 2008
been appreciated, criticized and debated by
is a significant example of the same. After
people from all levels of the society. Amidst
the crisis, countries around the world
all these concerns, the FRDI Bill, tabled at
developed mechanisms and laws to bring
the Lok Sabha in August 2017, has given rise
about a discipline among the financial institutions. Though India has various laws and regulations for the firms, they are scattered and there is no sole law for the monitoring of all firms. Currently, different regulators such SEBI, IRDA, RBI, etc., take care of the firms under them. The FRDI bill seeks to address this issue by working with the regulators and create a Resolution
Corporation. The Corporation will classify the
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moderate, material, imminent and critical)
satisfactory financial health. This means that
assessing the following.
the firm is not able to meet one or several
the firm is mandated to submit two plans
namely resolution and restoration plan. Both
Compliance with regulations
requirements set out by the regulator. Hence,
Capital, assets and liabilities
the plans have to be submitted within 90 days
Firmâ€™s effect on market conditions
of its designation. The resolution plan should contain the strategic plans to be adopted to
exit the resolution process and the restoration
empowers the regulators and the Resolution
plan should contain the period by which it
Corporation to take necessary measures in
will be completed.
order to prevent failure of the institution.
Categorization of the Institutions
Imminent Risk to viability A firm is classified in this category if the
Low/Moderate Risk to viability
probability of failure is much higher than acceptable levels. Firms under the Material
If a financial institution falls under this category, it implies that the firm is financially healthy or has just reached the threshold of risk. This also means that the risk of failure is
Risk category will be moved to the Imminent Risk Category if the one or more of the following conditions are met. I.
The financial institution has not
below the acceptable level. In this case, it is
submitted the restoration or resolution
enough if the firm comes under the
plans within the specified period
monitoring of its respective regulator alone. However,
The financial institution has not
implemented the restoration plan
information and reports from them, for its
either in part or full within the
specific date mentioned in the plan
Material Risk to viability This category is applicable for those firms which have just exceeded the threshold of
When an order is made by the court or tribunal due to fraud or misconduct
Critical Risk to viability
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This category will involve those firms on the verge
Order of priority for distribution of assets Deposit insurance
Resolution Corporation will assess the firms thoroughly before this classification. They
Resolution cost Wages and dues to secured creditors
will take into account the potential effect on any person
Uninsured deposits and unsecured creditors Remaining debt abd dues
management of the firm as well. The final
decision will be made after taking into consideration of the comments of all three stakeholders-
Corporation and the firm itself. After a decision is made, the classification will be done through an order in writing. After the order, the Resolution Corporation will take over the administration of the firm.
Resolution and Liquidation The resolution and the liquidation of the distressed institution will be taken up by the Resolution Corporation and completed within a maximum period of two years. The resolution may be done through acquisition, merger, and amalgamation of the institution or through the â€˜bail-inâ€™ clause and in worst cases liquidation of the company.
A snapshot of the entire procedure is given below.
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The Controversial ‘Bail-in’ Clause
The above rule applies to all financial
The ‘bail-in’ clause finds its mention in
institutions and the fear of people losing their
Section 52 of the bill. The clause if enacted
money in Savings Account and Fixed
could put the depositors money at risk if the
institution becomes bankrupt. Currently,
possibility of the Resolution Corporation
deposits up to Rs. One lakh are insured under
the Deposit Insurance and Credit Guarantee
institution is what brings more doubts in the
Act of 1961.
the FRDI bill
minds of people. Though the people haven’t
mentions about deposit insurance, it does not
lost their money before a bank failure, the
specify the limit.
Bill fails to place adequate safeguards in this
The two primary reasons for controversy are:
respect. So far, the RBI has ensured that big
banks take over smaller failed counterparts in
Corporation may change or modify the
order to protect people’s interests, the
form of liability of the institution or
chances of a Resolution Professional doing
cancel the liability altogether.
the same needs to be written out in clear
The Bill does not specify the amount that
terms. Those opposing the new law claim
a financial institution will have to pay to
that its fundamental idea is to transfer the
burden of non-performing assets created by
corporate defaulters to the common people.
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Benefits of the Bill FRDI bill brings in a discipline among financial institutions, and ensures
system. It benefits most of customers by reducing the cost and time while dealing with distressed
Once implemented, this Bill will create
resolution framework for the economy. To strengthen the Figure 4
stability and resilience of the
The Government has clarified that the
cancellation of the liabilities of the depositor
resolution corporation will be set up after the
beyond the insured limit cannot take place
bill is enacted. A common man who has a
without the prior consent of the depositor.
deposit with a bank will not have his amount
Government has also said that the bail-in
deducted by the bank if insolvency clubs it.
clause cannot be used for PSU banks.
Moreover, the use of bail-in clause will be
increase access to credit and reduces the cost
under government scrutiny and parliament
to obtain credit. Increased access to credit
leads to higher growth rate which creates
more employment opportunities. The government further claims that the bill will not do away with the Rs. One Lakh protection limit.
Comparison of international laws on financial institutions
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among financial institutions, and ensures a
Sources: United Kingdom Banking Act, 2009, United Kingdom Insolvency Act, 1986, United States Federal Deposit Insurance Act, 1950, Report of the Working Group on Resolution of Regime for Financial Institutions, RBI, January 2014, The Bank of Englandâ€™s Approach to Resolution, 2014; The Australia Financial Sector Legislation Act 2010;
Conclusion FRDI bill is an initiative by the government for the systematic resolution of financial institutions. The bill proposes to set up a Resolution Corporation which monitors financial institutions, anticipating their risk of failure and helps to take a corrective action in case of failure. The bill brings in a discipline
stable financial system. The bill was introduced in Lok Sabha on August 11, 2017 and presently under the consideration of joint committee of Parliament. The most debated part of the bill is the 'bail-in' clause, which states that the Resolution Corporation can cancel, modify or change the liabilities of the financial institutions if the need arises. This has created a fear in the minds of depositors who worry that their money will be lost if the bank is in crisis. The bill gives a vague idea regarding the Deposit Insurance limit. The Government must make certain changes in the bill so that there is no ambiguity in the minds of the people.
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CALL FOR ARTICLES Finance and Investment Club of IIM Rohtak invites articles from all Business Schools across India. The article should be original and should be related to finance and economics. All the reference should be cited and sources of images should be mentioned clearly. The winner of the article of the month will get Rs.300/- with an ecertificate. All the other selected articles will be published in our magazine ARBITRAGE Instructions: 1. Please send your articles before 25th April, 2018 on www.dare2compete.com 2. Do mention your NAME, INSTITUTE and BATCH with your article 3. Font: - Times New Roman, Size: - 12 in word .doc/.docx 4. Please DO NOT send PDF files and kindly stick to the format 5. Number of authors 2 at max 6. Maximum Word Limit: 1500 words, Minimum Word Limit: 500 words 7. Naming Convention: Name1_Name2_CollegeName.doc 8. Any Image without the source or label will not be accepted IMPORTANT: The article should be original and should not have been/should not be published elsewhere. You will be disqualified if you violate the same.
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Finance and Investment Club Indian Institute of Management Rohtak Disclaimer: The views and opinions expressed in this magazine are those of the authors and do not necessarily reflect the opinion of the stakeholders of IIM Rohtak.
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All Rights Reserved Finance and Investment Club Indian Institute of Management Rohtak MDU Campus, Rohtak, Haryana For any queries/feedback/comments mail to firstname.lastname@example.org Website: http://fi-club-iimrohtak.weebly.com/ Follow us on Facebbok https://www.facebook.com/FIclub.IIMRohtak/
We are pleased to publish the fourteenth issue of ‘Arbitrage’ – Finance and Investment Club’s monthly magazine. Arbitrage aims to cover a di...
Published on Apr 12, 2018
We are pleased to publish the fourteenth issue of ‘Arbitrage’ – Finance and Investment Club’s monthly magazine. Arbitrage aims to cover a di...