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Dated 4th January, 2018 | Copy of | A.P. (DIR Series) Circular No.15 | RBI CIRCULAR ToAll Category-I Authorised Dealer Banks Refinancing of External Commercial Borrowings Attention of Authorized Dealer Category-I (AD Category-I) banks is invited to paragraph 2 of the Statement on Developmental and Regulatory Policies issued along with the Fifth Bi-monthly Monetary Policy Statement for 2017-18. In terms of the extant provisions in paragraphs 2.15 and 2.16 (xiii) of Master Direction No.5 dated January 1, 2016 on “External Commercial Borrowings, Trade Credit, Borrowing and Lending in Foreign Currency by Authorised Dealers and Persons other than Authorised Dealers”, as amended from time to time, Indian corporates are permitted to refinance their existing External Commercial Borrowings (ECBs) at a lower all-in-cost. The overseas branches/subsidiaries ...

By Abin Daya Change is an unavoidable part of life - and of doing business. One of the biggest changes to the way we do business happened last Friday, with the rolling out of the GST. Yes, there will be disruptions in the short term and the cost of compliance will go up. Also, many small businesses will lose the tax arbitrage that enabled them to price below that of the larger companies. It will also increase the financing cost of business, particularly for those engaged in foreign trade. Speaking of financing, even that is not going to be easy. While credit growth is down because of low credit demand driven by the leveraged position of corporates combined with muted demand, even where businesses ...

The Dollar Business Bureau Aditya Birla Group on Tuesday announced it has received the banking license from the Reserve Bank of India (RBI) to operate its joint venture Aditya Birla Idea Payments Bank Ltd. Kumar Mangalam Birla-led outfit Aditya Birla Nuvo had earlier set up a joint venture with the other telecom major Idea Cellular to start payments bank services in the country. Aditya Birla Nuvo and Idea Cellular will hold 51:49 shares in the joint venture payment bank. "... the Reserve Bank of India... has granted a licence to Aditya Birla Idea Payments Bank Ltd to carry on the business of payments bank in India," Aditya Birla Nuvo said in a statement. Earlier last year, Airtel and India Post had formed a joint ...

The Dollar Business Bureau  The Reserve Bank of India (RBI) on Friday has come out with draft rules for centralised hedging for domestic subsidiaries of international companies. The foreign parent company of a subsidiary or its central treasury can be able to hedge the risks of currency arising from actual current account exposures of the domestic subsidiary to better manage the latter’s risk of currency, the central bank said in a notification.  The RBI had first announced the step in a policy review meeting in October. It had asked for comments on the draft guidelines by November 11.  The purpose of the new policy is “to provide greater flexibility for hedging currency risks arising from current account transactions of domestic subsidiaries of multinationals by ...

The Dollar Business Bureau  Reserve Bank of India (RBI) had made a strong case to provide further capital to public sector banks (PSBs) in order to deal with the issue of stressed assets and get back to a situation from which they can begin creating internal accruals. “Indian banks got into stress before implementation of Basel III and revised IFRS which provide protection against system level stresses...So we have to find more capital for supporting banks today. Of course government of India has supported entire AQR (asset quality review) exercise that we have done,” said N S Vishwanathan, Deputy Governor of RBI on Tuesday, while speaking at an ASSOCHAM event in New Delhi. “The Government of India has been providing support and required capital to the ...

The Dollar Business Bureau  The Reserve Bank of India (RBI) said on Tuesday that the bank’s balance sheet has surged to Rs.32,43,011 crore, an increase of 12.3 percent, for the year closed on June 30. During the same period a year earlier, the balance sheet of central bank’s stood at Rs.28,89,152 crore. “The increase on the asset side was due to an increase in foreign investments and domestic investments by 7.98 per cent and 35.64 percent, respectively, and on the liability side due to increase in notes in circulation and other liabilities and provisions by 15.92 per cent and 14.77 percent, respectively,” the Reserve Bank said in its annual report for the year 2015-16. During the given period, the assets in foreign currency and gold (consisting of gold ...

The Dollar Business Bureau Ending months of speculation over the next Reserve Bank of India (RBI) Governor, the government on Saturday appointed Urjit Patel as the next RBI chief as it looked to continue with the monetary-policy making and critical reforms which are currently at a progressive stage. Patel was among the four shortlisted candidates, which included Arvind Subramanian, Kaushik Basu and Subir Gokarn. He, a PhD in Economics from Yale University, was appointed as the RBI’s deputy governor in January 2013, and later given three-year extension in January this year. Patel is currently heading the monetary policy department, responsible for determining the interest rate policy. He, along with the current RBI Governor Raghuram Rajan, has been instrumental in formulating monetary policies in the last ...

The Dollar Business Bureau The Reserve Bank of India (RBI) on Wednesday notified that aggregate foreign investment limit in Chennai-based Equitas Holdings, which got an in-principle approval for small finance bank, should not exceed 49 percent. In September 2015, Equitas Holdings was among the 10 enterprises to have been granted in-principle approval from the central bank for setting up small finance banks. According to the RBI's notification, foreign investment in small finance banks would be in accordance with the FDI policy for private banks. A release by RBI stated that the overall investment limit in Equitas Holdings under the Portfolio Investment Scheme for foreign portfolio investors (FPIs)/foreign institutional investors (FIIs) shall remain at 24 percent and for non-resident Indians (NRI), the ceiling should be at 10 percent. “For total foreign ...