Only six PSBs cross ‘desirable’ level of provision coverage ratio

While public sector banks (PSBs) have substantially ramped up their loan-loss provisions and strengthened balance sheets in the first nine months of the current financial year, only 6 out of 21 PSBs, have crossed the ‘desirable’ level of 70 per cent provision coverage ratio (PCR) as of December-end 2018.

What is PCR?

PCR is the ratio of provisioning to gross non-performing assets, and indicates the extent of funds a bank has kept aside to cover loan losses.

The six PSBs that had over 70 per cent PCR as of December-end 2018 are: Bank of Maharashtra (81.08 per cent), Bank of India (76.76 per cent), IDBI Bank (75.21 per cent), Oriental Bank of Commerce (74.99 per cent), State Bank of India (74.63 per cent), and Bank of Baroda (73.47 per cent).

Though Life Insurance Corporation of India has acquired 51 per cent stake in IDBI Bank, the Reserve Bank of India has not yet notified the change in its classification as a private sector bank.

The five PSBs that were close to the 70 per cent PCR mark as of December-end 2018 are: Allahabad Bank (69.64 per cent), Central Bank of India (69.52 per cent), UCO Bank (69.49 per cent), Punjab National Bank (68.85 per cent), and Andhra Bank (68.47 per cent). The remaining 10 PSBs have PCR ranging from 58.84 per cent (Union Bank of India) and 66.60 per cent (Dena Bank).

“PCR has gone up because NCLT (National Company Law Tribunal) cases (40 large corporate accounts referred to the tribunal by banks as per the RBI’s list 1 and list 2) have been substantially provided for. So, banks’ balance sheet is getting strengthened.

“The unprovided portion is narrowing down. So, going forward, profitability of banks will improve (due to write-back from recoveries),” said BK Divakara, former Executive Director of Central Bank of India.

In a bid to ensure that banks build up provisioning and capital buffers in good times (when profits are good) so that the same could be used for absorbing losses during a downturn, the RBI, about a decade back, had prescribed that banks should augment their provisioning cushions so that their total PCR, including floating provisions, is not less than 70 per cent.

A few years after introducing PCR, the central bank did not insist on banks maintaining 70 per cent PCR. But it now appears that 70 per cent PCR is the ‘desirable’ level that the RBI wants banks to achieve, going by Deputy Governor Viral Acharya’s speech last October.

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Crack within UFBU may affect wage revision talks

A major crack has surfaced between bank officers and workmen unions over the issue of wage settlement, threatening to hamper the 11th bipartite negotiation. 

The United Forum of Bank Unions (UFBU) -- the umbrella body of nine trade unions -- which holds wage revision talks on the behalf of their members with the Indian Banks' Association (IBA), is even facing a split if the matter is not resolved fast. The two of the officers organisations abstained from the negotiation table in the last round of talks. 

The fight erupted between UFBU members following an IBA proposal of bank-wise wage settlement for senior officers from scale IV and above. Six banks -- State Bank of India, Bank of Baroda, Indian Bank, Oriental Bank of Commerce, Punjab National Bank and Union Bank of India -- have mandated IBA to restrict the wage rise offer to officers up to scale III. These banks proposed to fix compensation for their senior officers independent of the bipartite negotiation, and based on their paying capacity. 

In other words, these banks with better financials than the rest have shown willingness to offer higher remuneration package to their officers -- from chief managers to general managers. 

The 21 public sector banks employ over 10 lakh people. About 3.5 lakh are officers with about 60-65% of them being from these six banks. However, about 90% of the officers in all banks taken together fall in the scale I to scale III category. 

Protesting against the split mandate to IBA, the All India Bank Officers Confederation (AIBOC) -- the largest officers’ organization -- abstained from the last negotiation talks held on February 2 in Mumbai. At that meeting where two other bank officers unions were present, IBA raised its wage increase proposal to 10% from the previous 8% offer. AIBOC had walked out of the negotiation table on November 30 as well. 

“We want expeditious settlement of wages. We have appealed AIBOC leadership to return to the negotiation table,” AIBEA president Rajen Nagar told ET on Thursday. 

“If AIBOC does not return to the table, then workmen need to take a view of the situation. We cannot wait indefinitely,” Nagar said. 

Earlier, AIBOC criticized AIBEA general secretary CH Venkatachalam for reportedly inciting a split within UFBU. 

“He (Venkatachalam) has stated that the present offer of IBA is more in quantitative terms than the quantum paid in the 10th bipartite settlement. He has also said the officers’ associations are creating impediment to the settlement. We strongly denounce unilateral pronouncement of one constituent of UFBU on the merit of the present offer of IBA which is very likely to jeopardize the ongoing negotiation,” AIBOC general secretary Soumya Datta had said last Saturday. 

"We seek your immediate intervention at this critical juncture so that the edifice of joint movement do not suffer," Datta said in a letter to UFBU. 

National Organisation of Bank Officers (NOBO) also did not take part at the February 2 meeting while All Indian All India Bank Officers Association (AIBOA) and Indian National Bank Officers Congress (INBOC) were present. 

“His (Venkatachalam’s) statement has been distorted. He has only narrated the truth at a union meeting in Kanpur,” AIBEA’s Nagar said. “The fact remains that we have rejected IBA’s 10% offer,” he said. 

The 11th bipartite settlement is due from November 1, 2017.  

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Punjab National Bank(PNB) recruitment 325 various posts 2019

Punjab National Bank has published Advertisement for below mentioned Posts 2019. Other details like age limit, educational qualification, selection process, application fee and how to apply are given below.

Posts:

• Senior Manager (Credit) MMGIII: 51 Posts
• Manager (Credit) MMG Scale-II: 26 Posts
• Senior Manager (Law) MMG Scale III: 55 Posts
• Manager (Law) MMG Scale-II: 55 Posts
• Manager (HRD) MMG Scale-II: 18 Posts
• Officer (IT) JMG Scale-I: 120 Posts

Total No. of Posts: 325

Educational Qualification: Please read Official Notification for Educational Qualification details.

Selection Process: Candidates will be selected based on an interview.

Important Dates:

Online Registration of Application starts from 14 February 2019

Last date for Online Registration of Application: 02 March 2019

Tentative Date of Online Examination: 24 March 2019

How to Apply: Interested Candidates may Apply Online Through official Website.

Apply Online: Click Here

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Abhyudaya Co-Operative Bank recruitment for 100 posts 2019

Abhyudaya Co-Operative Bank has published Advertisement for below mentioned Posts 2019. Other details like age limit, educational qualification, selection process, application fee and how to apply are given below.

Posts: Clerk

Total No. of Posts: 100

Educational Qualification: Any Graduate from a Recognized University.

1) Proficiency in the Marathi language is desired / will be given preference

2) Knowledge of English is required.

3) Candidates should have computer knowledge (as per assessment at the time of interview).

Age Limit: Between 20 to 30 years

Application Fee:

General / OBC Category: Rs. 1200/-

SC/ST/NT Category: Rs. 600/-

Selection Process: Final Selection will be based on online test/examination and interview.

Important Dates:

Starting Date of Online Application: 14-02-2019

Last Date to Apply Online: 20-02-2019

Exam date (tentative): 10-03-2019

How to Apply: Interested Candidates may Apply Online Through official Website.

Apply Online: Click Here

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PSU Banks bleed: Aggregate losses of 21 lenders at Rs 11,605 crore in Q3

Aggregate losses for a clutch of 21 public sector banks in the quarter ended December 2018 came in at Rs 11,605 crore, led by a massive loss of Rs 4,737 crore from Bank of India and Rs 4,815 crore from IDBI Bank. The aggregate losses of these 21 banks in the September 2018 quarter stood at Rs 14,716 crore. Of the 21 PSBs, 11 posted a profit, compared to seven banks in the previous quarter, data from Capitaline showed. In Q3FY18, the 21 banks had reported a combined loss of Rs 18,097 crore.

The losses were down 35% y-o-y, which was led by the State Bank of India (SBI) reporting a net profit of Rs 3,954 crore against a net loss of `2,416 crore in Q3FY18. “Lower slippages coupled with lower overhead expenses and write-back of mark-to-market provisions due to softening of bond yields contributed to strengthening of the bottom line,” said Rajnish Kumar, chairman, SBI.

Operationally, the banks fared well with the combined net interest income (NII) increasing nearly 11% y-o-y to Rs 59,505 crore. However, the pre-provisioning profit witnessed a mild reduction of 1.4% y-o-y to Rs 36,515 crore, on account of an increase in interest expense due to increased deposits.

SBI’s deposits grew 6.8% y-o-y to Rs 28 lakh crore and Bank of Baroda’s deposits grew 6.5% to Rs 6.1 lakh crore. Provisions for state-owned banks fell 21% y-o-y, backed by stronger asset quality. Among the 21 banks, the steepest climb in provisions came at Bank of India (BoI), which saw the figure jump 109% y-o-y to Rs 9,000 crore. BoI said it had set aside Rs 5,000 crore additional provisions in view of uncertainty of recovery and deterioration in value of underlying assets against 331 NPA accounts. “In respect of RBI-referred NCLT accounts (list 1 & 2), the bank has made a provision of Rs 572 crore during the quarter ended December 31, 2018, due to uncertainty of recovery. The provision held in respect of NCLT accounts stood at `6,939.02 crore as on December 31, 2018, representing 100% of the outstanding value,” the bank said in a statement

Gross non-performing assets (NPAs) rose 7.2% y-o-y to Rs 8.3 lakh crore. “Gross NPAs increased, however, at a comparatively lower rate in Q3FY19 vis-à-vis a double-digit growth in Q3FY18. This could be due to lower incremental NPAs being generated,” said analysts at Care ratings. All six banks under the Prompt and Corrective Action (PCA) framework of the Reserve Bank of India (RBI) have recorded a spike in NPA numbers. Apart from the banks under PCA, Punjab National Bank (PNB) reported a 35% increase in its NPA to `77,733 crore citing exposure on account of the Nirav Modi-Mehul Choksi fraud.

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Results of Public & Private sector banks for Q3FY19

Public Sector Banks :(Data will update as result will declare)

Allahabad Bank

Andhra Bank

Bank of Baroda

Bank of India

Bank of Maharashtra

Canara Bank

Central Bank of India

Corporation Bank

Dena Bank

IDBI Bank

Indian Bank

Indian Overseas Bank

Oriental Bank of Commerce

Punjab & Sind Bank

Punjab National Bank

State Bank of India

Syndicate Bank

UCO Bank

Union Bank of India

United Bank of India

Vijaya Bank

Also Read- Quarterly Results of Public sector banks for Q2FY19

Also Read- Quarterly Results of Public sector banks for Q1FY19

Private Sector Banks :(Data will update as result will declare)

Axis Bank

Bandhan Bank

City Union Bank

DCB Bank

Dhanlaxmi Bank

Federal Bank

HDFC Bank

ICICI Bank

IDFC First Bank

IndusInd Bank

Jammu & Kashmir Bank

Karnataka Bank

Kotak Mahindra Bank

Karur Vysya Bank

Lakshmi Vilas Bank

RBL Bank

South Indian Bank

Yes Bank

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RBI imposes penalty on 7 banks

The Reserve Bank of India (RBI) has imposed monetary penalty on seven banks for non-compliance with various directions issued by the RBI, including monitoring of end use of funds.

The banks are: Allahabad Bank (Rs 1.5 crore), Andhra Bank (Rs 1 crore), Bank of Maharashtra (Rs 1.5 crore), Indian Overseas Bank (Rs 1.5 crore), HDFC Bank (Rs 20 lakh), IDBI Bank (Rs 20 lakh) and Kotak Mahindra Bank (Rs 20 lakh).

According to the RBI, these penalties have been imposed in exercise of powers vested in the Reserve Bank under the provisions of Section 47A(1)(c) read with Section 46(4)(i) of the Banking Regulation Act, 1949, taking into account failure of the above banks to adhere to the directions issued by the RBI.

“This action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the banks with their customers,” the RBI said.

With this, the RBI had slapped penalty on 11 banks in the last one week for violation of various norms.

However, the RBI has not spelt out the exact nature of the violations in its brief statements put on its website.

On February 7, the RBI slapped Rs 1 crore penalty on State Bank of India, the country’s largest lender, for violating norms. The penalty was levied on the bank for not monitoring the end use of funds in respect of one of its borrowers.

On February 5, the RBI had imposed a penalty of Rs 2.2 crore on private sector lender Axis Bank in two separate cases, Rs 2 crore on UCO Bank and Rs 1 crore on Syndicate Bank for violation of norms.

The Reserve Bank said a penalty of Rs 2 crore has been imposed each on Axis Bank and UCO Bank for non-compliance of norms related to payment through cheques.

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Punjab & Sind Bank reports net profit in Q3FY19

State-owned Punjab & Sind Bank on Tuesday reported a net profit of Rs 22 crore in the third quarter ended December 2018. It had reported a loss of Rs 258 crore in the corresponding period of 2017-18, according to a release by the company.

The bank's total income increased during the quarter to Rs 2,337.13 crore as against Rs 2,178.69 crore in the corresponding period of 2017-18.

Gross non-performing assets (NPAs) rose to 11.19 per cent of the gross advances at the end of the quarter, against 10.95 per cent in the year-ago period.

However, net NPAs declined to 6.90 per cent, compared with 7.20 per cent a year ago.

As a result, provisions for bad loans increased to Rs 453.88 crore during October-December 2018, against Rs 417.51 crore in the third quarter of the previous fiscal.

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