Indian Banks

The Reserve Bank of India declared that short-term loans given by banks to housing finance companies (HFCs) for further lending to end borrowers will not be included in  priority sector lending.

Therefore RBI said that “Banks should note that if the tenor of such loans granted by them to HFCs is not co-terminus with the onlending of HFCs, they will not be eligible for classification under priority sector lending,”

As per apex bank , Since the housing loans are generally medium to long term taken by individuals, short-term loans with tenor of six months to one year granted by banks to HFCs for onlending purposes would not be same as the loans taken by the individuals.

(BS)

Popularity: 1% [?]

Reserve Bank of India is likely to hike the cash reserve ratio (CRR) – the portion of deposits banks have to keep with the central bank – by 25-50 basis points without waiting for the scheduled review of the monetary policy in January 2010. The CRR remains unchanged since January 17, 2009 when it was cut 50 basis points to 5 per cent.
Duvvuri Subbarao (RBI Governor) met Pranab Mukherjee(Finance Minister) to discuss the macro-economic situation after the latter presented the mid-year review of the Indian economy today in Parliament . According to Mukherjee’s the growth outlook for the full year is likely to be 7.75 per cent or even higher.
As per, the finance ministry “ base effect gives , rise in the price index. Therefore unlike the finance ministry, the RBI is also worried about rising prices.
Inflation for November rise from 4% to 4.78%, which was 1.34% in the previous month.

Popularity: 1% [?]