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Friday, October 24, 2014

Banking News 25th October 14

PSU banks fail to sell MFs-Business Standard

Despite having their own asset management cos PSBs, sans SBI, have earned dismally low brokerage incomes of less than Rs 10 cr
Public sector banks (PSBs), despite their huge branch networks, haven’t been doing much to expand their mutual fund (MF) businesses.

State Bank of India (SBI), Punjab National Bank, Bank of Baroda, Canara Bank and Union Bank of India all have their asset management companies (AMCs). SBI apart, the others earned dismally low brokerage incomes by selling MFs, less than Rs 10 crore each, in 2013-14. SBI, with a little over 13,000 bank branches, did marginally better — it earned Rs 29 crore.

Private banks, with a much lower branch base, sold MFs more aggressively. HDFC Bank, ICICI Bank and Axis Bank had brokerage incomes of Rs 159 crore, Rs 118 crore and Rs 94 crore, respectively, that year.

Says a leading distributor: “Private banks are more aggressive in this business because they consider the fee income —  brokerage and trail commission — an important aspect of their balance sheet.”

As a result, PSB-sponsored MFs are ranked low. SBI's, with average assets of Rs 72,800 crore is 6th in the ranking, an exception among PSBs. Baroda Pioneer, a joint venture between Bank of Baroda and Pioneer Investors, with assets of Rs 7,100 crore, was ranked 22nd; despite a good market, its average assets have fallen since March by Rs 1,000 crore.

More interesting is their strategy. PSBs have concentrated on only selling schemes of their fund house. SBI earned 97 per cent of its brokerage income from its own AMC. Union Bank and Canara Bank have 94 per cent and 100 per cent of incomes from their AMCs'. Clearly, they are unwilling to sell other MF products, though a senior executive from Canara Bank said, “We also have tie-ups with other AMCs. (But), besides the fee money, the overall improvement of the joint venture is also the motive.”
A senior official with SBI said while many officers have been sent on deputation to the AMC, it was natural for a parent to promote products of its subsidiary.

MF managers say all this is a a pity, as these banks have a strong branch network. "A number of schemes that are doing very well but might not belong to the PSB-sponsored fund houses. If they push these schemes as well, they will get more income, beside selling a scheme that has a good history.” In sum, PSBs are acting as agents of their own AMCs, rather than brokers.

Said Hemant Rustagi, chief executive of Wiseinvest Advisors, an MF distributor: “If the sector wants to move beyond the top-15 cities, PSBs have a big role. They are already established in smaller towns and have the confidence of the bank customer. Fund houses on a standalone basis will take a long time to establish their brand in these places.”

Those in the MF sector say as many banks do not set targets such as on fee income from selling such products, branch managers are more interested in meeting their deposit and loan targets. MFs take a back seat.
Lenders against plan to limit appraisals for large loans to big banks
Lenders have rejected a proposal put forth by the department of financial services (DFS) that said credit appraisals for loans above R500 crore should be done by the larger banks. The Indian Banks’ Association (IBA) has written to the finance ministry saying the proposal was not a workable one, sources in the know told FE.
“Members are of the view that this proposal to restrict the credit appraisal process to some five or six banks is not in best interest of the banking industry,” the IBA letter sent to the ministry of finance noted.

An IBA official confirmed the association had replied to the ministry citing the views of bankers but had not yet got a response.

At the managing committee meeting of the association last month, bankers pointed out they were satisfied with the current process of each bank appraising the risk on its own rather than relying on the lead banker. Among the banks that the ministry had suggested should do credit appraisals are State Bank of India (SBI), ICICI Bank, Bank of Baroda and IDBI Bank.

Bankers are hoping the finance ministry will agree with its views since they believe collective due diligence may not work. SBI chairman Arundhati Bhattacharya had said recently that only if the due diligence was done by the banks themselves would a proper appraisal be possible.”You won’t be able to take the right decision until you understand the risks and the appetite for it,” Bhattacharya had said.

Bankers pointed out that while intermediaries like SBI Capital Markets do undertake the credit appraisals for consortium loans, banks do not depend on their assessments and carry out the due diligence themselves. The ministry had last month expressed concerns regarding the due diligence process, questioning the outsourcing of the process to an intermediary that appraises the exposure on the bank’s behalf. The concerns stem from the large amounts of non-performing assets (NPAs) that public sector banks have on their books. The ratio of gross NPAs to gross advances stood at 4.1% in FY14, up 70 basis points (bps) from 3.4% reported in the previous financial year, according to Reserve Bank of India. Net NPAs, on the other hand, were up 50 bps to 2.2%.

Misleading Debate On Black Money

India has signed double tax avoidance treaty with countries from whom the information related to back money has come to India. The agreement was signed much before BJP or NDA assumed power. Now as per terms of the agreement if BJP shares the information with media ,it may give MASALA to media and common men or opponents to fire bullets against the current government at centre led by Narendra Modi , but the foreign countries will stop disclosing names in unison with the agreement already signed by none other than Indian Government . It is immaterial whether BJP or Congress Party signed the agreement.

However as soon as the charges against culprits are established, the name can be    disclosed, as I understand from newspaper information. However the final order of Supreme court in this matter will throw light on this issue, how to deal with a situation where the country has to respect treaty signed by a government of India.

It is undoubtedly true that government, NDA or UPA cannot go against the spirit of agreement already signed with foreign countries by Indian government, headed by NDA or UPA , otherwise India as a whole will lose its credibility in international forum. No other country will sign such agreement in future with India. There are specific clauses in the tax treaties with countries (which have furnished names ) that prevent sharing of information. However the information is in various stages of processing and investigation and as soon as it is established that the charges are fit for legal action , the name will automatically come to media. I hop media will also understand the intricacies of treaties and will not give scope foreign countries to dilute their faith on India.

So far as election campaign is concerned, it is not only BJP but all political parties resort to various promises to attract voters in their fold. Promises are not always fulfilled . It is easy to distribute freebees to lure voters from government fund , it is easy to approve quota for various castes and communities, it is easy to sanction subsidies for various projects, it is easy to grant release of prisoners to please voters of some community but it is not easy to violate international treaties.
Now BJP government will have to make effort to alter the terms of agreement and make it convenient to disclose the name of persons who parked black money in foreign banks. It is in the interest of the countries that huge amount of black money parked in other countries to evade tax must be brought back to India and real culprit must be brought to task .It is clearly visible that BJP led NDA government has taken up the matter with Swiss government and left no stone unturned to achieve desired outcome. Matter is moving ahead fast and one can hope for better outcome in near future.

Last but not the least ,media men or some opponents of  Mr. Modi are trying to trap Mr. Modi only because his government has stated in Apex Court Today  that the government cannot reveal the names provided by foreign banks because international treat does not permit it. They should know that even money parked in Indian banks, black or white cannot be disclosed until it is proved that the money kept in a particular account is black or illegally earned. Secrecy Act in India prohibits banks sharing any information to depositors or borrowers until asked under legal provisions or an order to this effect is issued by any court.

Black money is kept not only in foreign banks but also in Indian banks in volume much more than it is foreign banks. Government will have to strike at the root cause of creation of black money. GOI will have to investigate how tax evasion takes place in such large volume and how does it not comes in the knowledge of tax officials. GOI will have to introspect why  court failed to punish black money creators , why and how  team of Chartered Accountants in nexus with tax officials help businessmen small or big , in tax evasion or in payment of tax which is too low in comparison to income really earned by a businessman.

BJP should also learn lesson from this episode that a party should not make such promise fulfilment of which is dependent on other nation and international rules and ethics. Indian government or Indian political parties can function as per their constitution within their boundaries only but cannot take decision which may affect the rules of other countries.
If UPA or Congress Party feel that there is no such treaty in force and they are not part of any such treaty which bars disclosure of name, they should strongly oppose the stand taken by BJP and put forward all such document in public domain in the larger interest of the country. But it is also true that even Congress Party did not disclose the names which they received during their tenure . And if what BJP government has stated in Supreme Court is true , Media men and opposing parties should stop mudslinging process on TV to save the country's image in world forum.

Last but not the least, even role of Supreme Court is limited in matters which are linked to international treaties and rules.

I am submitting below a few letters/blogs written by me in past few years during UPA rule
which are eye- opener for those Politicians, media men and nationalists are misguiding people of India on black money issue . Majority of debate carried out on Black money are not at all close to ground reality of black  money. Politicians and media  men are talking with prejudiced eyes and are not ready to accept truth publicly.

I simply ask a question to them whether they can disclose the money white or black parked in Indian banks by any Indian individual or company unless and until it is proved in court of law that the money held in account in a bank is black and not accounted for in annual return?

Common men who do not understand the intricacies of black  money and white money can be misguided to please one section or the other of political class, but cannot help in getting back black  money parked either is Foreign Bank or in Indian Bank. However it appears that the current BJP led government is moving in right direction without leaving behind any doubt on their integrity.

Datd 6th April 2009

It is beyond imagination that government of India will be able to bring all money black or white to India. I am unable to understand when and how government will be able to ascertain the color of money until foreign bank provides true information on all accounts and Indian inspecting officers have willingness and enough resources to reconcile the same with IT return of the same person in India to assess the true colour of the money.
There are many reasons behind it. Some of the reasons are submitted below.

Foreign bank will not agree to share information with our country as long as there is mutual agreement between the two countries for mutual share of information.

As per Indian law I think even Indian bank or Indian government has got no right to share information of any account of any person in India with foreign bank or any foreign based authority.

Foreign based banks as learnt from various articles in this respect do not ask for much information about person ,opener of accounts as much as person opening account in Indian banks are supposed to provide to the banks (strictly as per KYC norms)

Income tax officials are not so much honest and sincere that they will try to catch such person. Had they been so much sincere and honest they could have caught black money parked in Indian Banks and which is at least hundred times of what amount is said to be parked in Swiss bank or any other foreign based bank. In fact it is they (IT personnel) who teach taxpayers method of saving tax and how to evade tax because they get bribe in cash or kind from such taxpayers.

Government of India is made of dirty politicians and they do not have real willingness to make such stringent rules which forces Indian taxpayers or Indian Income earners to declare the income truly, honestly and correctly in their IT returns. Because survival and development of India Politicians lies on the existence of black money only

Entire politics of India runs on black money and without help of such black money any political party or any individual contesting election cannot imagine of spending crores of rupees in election. Most of the candidates in current election has declared income and declared capital of less than one crore but he will spend not less than five crores to win the election. Wherefrom such money comes is such question which none can answer correctly.

Majority of government officers have huge unaccounted money and it is they who can afford buying a house worth more than a crore in the mid of the town. Very few of honest employees in any department can imagine of purchasing a house worth even twenty to thirty lacs in white money (house in India is traded in two parts, one white money and another part of cost is in black money) because real cost of such house including black money is always more than at least sixty lacs.In India there are hardly one out of 100 house worth more than a crore is registered in true value of the house. Government can easily count such houses in each town and find out real tax evaders if they are really interested to catch black money.

Obviously it s an open secret that there are plenty of black money in Indian economy and Indian government has failed to curb it despite promises and hue and cry made by several VIPs and despite shedding crocodiles tears by so many politicians. Therefore one cannot even dream of getting Indian black money parked in foreign banks. Doing politics is one thing and doing something real is entirely a different story.
Lastly I would like to suggest government of India to discard adherence of KYC norms and remove anti money laundering act and ask all banks to open account in any manner in the name of any true or false person and allow money to be deposited in Indian bank. In this way entire black money will come back either in bank or in circulation. At least money will not be parked in foreign banks in Indian banks accept money freely.

 This is desirable because government of India cannot control effectively inward and outward remittances taking place through banking channel despite all claims and assurances of controlling authorities. Money going abroad through fictitious import and export still persists in trade and growing day by day. Not to speak of money being imported or exported, even arms and ammunition are being imported in disguise to spread reign of terror by terror groups and Indian government remain silent spectator .Inspite of several steps taken by government of India for last two three decades and inspite of several stringent laws in this regard to curb spread of black money transaction ,our law enforcing agencies in collusion with politicians have miserably failed to effectively enforce existing rules and ensure finish of black money from the system.

It is absolutely true that black money generated and accumulated by Indian businessmen and bribe money earned by servicemen and politicians are mostly parked in Indian banks or invested in landed property. Bribe, graft, kickback etc are mostly used to purchase landed property. This is why landed property worth Rs.100 lacs is actually registered at value of hardly 25 lacs in the office of Registrar.

One can say without any hesitation that black money generated in India in a day is at least equivalent to total value of property sold or bought in India in a day at various offices of registrars. Further to add fuel to fire, value addition in black money is far greater in India than any other country because of greater rate of interest in Indian banks compared to what is prevalent in foreign banks. Value of landed property, gold, silver etc invariably rises year after year at rate more or less equal to interest rate.

This is open secret and every land owner knows that actual sale value is at least twice the value at which it is registered. Black money generated through illegal transactions in India is used in real estate sector and then in gold, silver, diamond, share market or in commodity market. It is further converted into number one money either by creating more and more fake files, fake firms and fake transactions or fictitious export and import .Black money generated at foreign centers is either parked in foreign banks or routed back in India through Mauritious like countries.

This is really the big reason why price of landed property is increasing year after year and has really gone beyond the reach of common men. This is the reason that turnover volume has been consistently rising in stock and commodity market .Similarly prices of gold and silver have gone beyond the reach of common men. People who have black money easily hide the same by purchasing gold ornaments or that of silver and diamond. Government is wilfully promoting rise in price in real estate sector and in return their party members get considerable financial help in contesting election and earning wealth for their family.

To add fuel to fire, government has given all types of tax exemption to those who buy house or who avail home loan due to which most of the rich corporate houses and rich individuals have become builders of the town and use this opportunity to convert all ill earned money or black money into number one money.

It is ironical that Doctor Manmohan Singh the great economist, Expert Ex- Finance Minister Mr. Pranab Mukherjee and Ex Finance Minister Mr. P. Chidambram willfully allow unprecedented benefits on purchase of home of whatsoever value it may be. All such tax benefits ultimately go in the hands of rich people. Unfortunately all such promotion to black money takes place in the name of common men, in the name of GDP growth and in the name of development. At the same time these people shed crocodile tears on Black Money and pretend to take against who are tax evaders. As such it is not exaggeration to say that black money produced in Indian economy and parked in India is many times more than the total amount of black money said to be parked in Swiss bank or in other in foreign banks. And growth rate of black money is also greater than that of GDP growth or inflation rate.
Government should make efforts to reduce creation of black money in following ways.

First and foremost is very simple solution to the problem of black money and it is minimizing cash transaction. As per company rules all payment above value of Rs.20000 should be through cheque but still companies are making purchases in cash .Ramdeo Baba has right pointed out that notes of Rs.500 and Rs.1000 should be demoetised.Even Rs100 note should be demonetized. Politicians always talk of poor farmers, small traders to continue their earning through evil means. More than 90 percent of population of India does not earn 100 rupees a day; more than 50 % of population does not earn even Rs.20 a day. As such they will not face any problem. In developed countries like USA, 99 percent of sale and purchase take place through cards or bank cheques and after giving acceptable identity only. In India 90 percent of sale and purchase takes place in cash. Government should try honestly to remove all constraints coming in way and ensure that more than 90% of such transactions takes place through cheque .

Most of traders and manufacturers and government officers are perhaps aware that only in Delhi purchases by traders takes place in hundreds of crores of rupees in cash , or by Rs.9000 demand draft ( less than Rs.20000 DD can be purchased in cash). Draft of value less than Rs.20000 are purchased by traders in every nook and corners of the country and used in Delhi to buy goods and these DDs circulate as hard currency and as black money for six months (period for which DD is valid in banks).If all purchases in Delhi, Surat, Rajkot, Kolkata, Mumbai start taking place in cheque, they seller will start selling on bills and paying tax.

Secondly government should try to bring all incomes generated by servicemen, traders and manufacturers in tax domain. for this purpose they should stop all types of reliefs, concession exemptions. Chartered Accountants and Tax consultants guide Income tax payees how to save tax and how to avoid tax payment. Severe punishment should be given to CAs who is master in converting black money into white money. Tax exemption limit should be upto ten lacs should be permissible so that number of service men are excluded from tax payment and in this way tax authorities will have controllable numbers of assesees to scrutinize. Those IT officials who allow tax evasion by taking bribe should be severely punished in shortest time so that there is demonstrative effect on juniors and babus working in his office.

Thirdly all purchases of house, lands and commercial property should be thoroughly checked by IT officials and where the sale value shown is far less than prevailing market rate , they should be allowed to either cancel the deal or they should purchased the property on behalf of the government and distribute among poor and middle class service men. In Mumbai itself flats worth more than a crore rupees is registered at value Rs, 25 to 50 lacs. Such low valued registration takes place in India every day in good numbers and government is fully aware of it. Most of the netas and officers are purchasing high value properties and it is they who are supposed to stop creation of black money. Birds of same feather flock together. Officers and politicians save each other , thieves always have good relation among themselves so far as action against them by police is concerned.

Fourth, government should adequate manpower in police and judiciary to ensure that pendency of FIR and court cases in Thana and courts respectively is brought down from 50 millions to 50 thousand and lower .There should be fear of law in the minds of all evil doers. Action should be sever and quickest against those who violate rules. There should be honesty in execution of laws too. Law enforcing agencies if found on wrong path should be severely punished. Officers and politicians who hold top post and commit mistake or indulge in illegal practices should be punished more so that subordinates working under them do not dare to think of taking bribe or illegal money from any citizen.

Fifth root cause of all corruption is dishonesty in recruitment, promotion, posting and transfer of staff working in government offices. Corrupt officers humiliate honest officers and reject them in promotion processes or post them at the most critical places. Due to this culture of flattery and bribery takes the root in all organization. Property of all top ranked officers and ministers must be checked and those found to be guilty of earning money through bribe either in cash or in kind must be brought to task immediately and severely to demonstrate his subordinates that evil workers are not spared. Such corrupt officers should be removed from the services and those honest officers who have been sidelined should be brought back in mainstream to give a moral boost up those who are devoted workers. For this purpose all officers who have been elevated violating seniority should be given their due award and on the contrary officers who promoted this unhealthy culture should be demoted and posted at critical places.

Expenses on all types of election should be banned. Any Indian citizen who is recognized in an population area of say 10000 should be allowed to contest and do door to door campaigning to prove his caliber and popularity. Each such elected person should form a body and then they should elect one person for each black and each district. No rally, no pamphlets, no car rally , no processions, no banners and in brief no expenses either on nomination or on campaigning. Politicians are very clever and it is they who promote black money and it is they who taken huge money from corporate houses, top ranked traders, high profile servicemen, professionals and businessmen to enrich their political fund.

Crores of rupees are spent by all contesting persons in a general election and all these money are nothing but black money. Users of black money cannot allow stopping of creation of black money as long as government do not ban all types of expenses. Politicians always talk of government funding and never talk of reducing expenses. It is these hard core politicians who by dint of their huge money power purchase voters, give them temptations of various types of gifts and strangulate democracy. In fact democracy and secularism are two words which have been used by politicians as tools to befool and loot Indian citizens. These clever politicians divide the voters on caste and communal grounds, backwards and forward ground, poor and rich ground, regional and religious ground and finally win the election to perpetuate their job of looting the nation. They know very well that Indian laws are in their hands and they can manipulate police, judiciary, law enforcing agencies, vigilance agencies and administration by dint of their money power and by dint of their post.

Corrupt practices and use of black money is so much deep rooted that one can say without any doubt that democracy and secularism are meant for corrupt people only. Government is made of corrupt persons, made for corrupt persons and made by corrupt persons.

And so on

Government has to ensure rule of law in all its offices. Government has to creat fear of law in the minds of common men , poor and rich without any discrimination based on caste, community , region or religion.

Last but not the least government has to demonstrate their good intention by actions not by making false promises in public rally. Cleaning process should start from top and not from bottom as usually happens. Government has to ensure that officers and babus posted in all its offices work honestly for the country and at the same time all elected representatives like MLA and MP should move in the field to ensure complete, perfect and judicious executions of plans and policies formulated by the government. Now- a- days even MLA and MPs are highly paid government servants and hence supposed to work 12 hours a day as government servants do in other offices and departments. Top ranked officer should not expect red carpet welcome from their juniors and all types of expenses on show business must be stopped forthwith so that flattery culture in employees is transformed into work culture.

Love for the country should be made inevitable and not negotiable on caste or communal ground.

Black Money in India, in Indian banks and invested in real estate sector is many many times greater than total of black money parked in various foreign banks including that in Swiss Bank. UPA Government in Delhi has been making various lame excuses for its failure in declaration of black money held in foreign banks as National assets. But do they fail to stop game of black money in India itself.
It may be difficult for the government to force foreign banks to declare details of account holders. But I am unable to understand why government in not interested to strengthen control mechanism on financial transactions to stop continuous escalation in black money racket in India and why government fails to unearth black money from Indian market and why does it fail to punish real perpetrators of black money.

Government is adamant not to accept strong Jan Lokpal Bill proposed by Civil Society team led by Anna Hazare. Government has threatened to take action against Anna Hazare and his team if they start fast unto death from 16th of July as proposed by Anna to force government to accept their draft for Lokpal. Mr. Digvijay Singh veteran spokesman of Congress Party has already threatened to take action against Anna in the same way as Delhi Government they did against Ramdeo Baba on June 4 at Ramlila Ground Delhi.

I am unable to understand why the government is bent upon teaching a lesson to those who are selfless leaders, who are fighting against corruption, who have raised voice against corrupt system, who want nothing but change in the system and who are well wishers of the country.

Why government is not teaching lessons to Naxalites and Maoists who are indulged in killing of innocent people in various naxal affected belts in India and who are engaged in forceful extortion of money from businessmen, servicemen, police officials, politicians, administrative officers and contractors and all affluent persons of the society.

Why government is not interested to teach lessons to those corrupt officers and corrupt politicians who are looting the country .Why does government want to provide shield to corrupt politicians including Ministers, MPs, MLAs, corrupt judges and corrupt officers. Why the government is not interested to pursue cases of high value scams which are being investigated by CBI and other agencies at the instance of Supreme Court and High courts.

Why is government showing its indifference on relentless price rise and not punishing black marketers, hoarders and smugglers who are charging abnormal profits on their products and services.

Why is government silent on large scale use of black money in educational institutes, real estate sector, hospitals, hotels, public rallies, and welcome parties organized by flatterers in various offices etc .

Why government is hesitant to arrest top ranked bankers, doctors, engineers, IAS officials, IT officials, CAs, Advocates, custom officials and various brokers in share market who are indulged in corrupt practices.

Since the leaders of Congress Party are in power, they cannot be allowed to threaten well wishers of the country .If government is of good intention they can exhibit the same by taking action against top ranked corrupt officers and corrupt ministers by using existing laws and rules. People do not like that low level junior babus and officers be made scapegoat for evil works done at the instance of top ranked officers and minister.

If they fail to act effectively against looters of the country and continue to cheat people of India on some ground or the other and go on punishing innocent people fighting against corruption, I hope voters of India will ultimately punish the current ruling party.

Of course the present government can misuse the power for a few years in want of disunity of opposition parties, but not for a longer period. Late Indira Gandhi after her defeat in election petition at Allahabad High Court had imposed emergency in the country and arrested all prominent leaders of opposition parties. But her reign of injustice could not last long. People voted her out due to emergency excesses and Janta Party came to power. History is going to be repeated as it appears to common men.

Since the movement launched by Ramdeo Baba and Anna Hazare is peaceful movement and not violent movement as launched by Telangana fighters or Gujjar fighters, government is contemplating of stern action. If the movement becomes widespread and violent, the situation will go beyond the control of the government and its leaders will fail to continue their dirty politics as they usually do against their opponents.





Late Sitting And 5 Days Working

Public sector bankers plan to ask Finance Ministry for 5-day week--19th April 2014


To submit a cost-benefit analysis; cite 24/7 access to services via ATMs, Net, mobiles
Executives from State-owned banks seem determined to prove to the Finance Ministry that a five-day work week is feasible in the banking sector.
While the ministry turned down bankers’ earlier feelers to this end, this time round, the bankers intend to knock on its doors with a cost-benefit analysis for a five-day week.
The ministry has contended in the past that the cause of financial inclusion would suffer with a shorter week, but bankers feel that in this age of modern technology, a bank is accessible to customers 24/7 via alternative delivery channels such as ATMs, the internet, mobile commerce and business correspondents. Financial Inclusion refers to mainstream banks ensuring all sections of society, in general, and vulnerable groups, in particular, have access to financial products and services at an affordable cost, in a fair, transparent manner.
According to a top public sector bank official, the Indian Banks’ Association will carry out a cost-benefit analysis of the five-day work week pattern and the same will be placed before the ministry for its consideration.
A trade union official wondered why bank employees should be denied the benefits of a five-day week when Central Government employees have been enjoying them for nearly three decades.
To increase efficiency in administration, the Union Government had introduced the five-day week in 1985, increasing daily working hours during the five days by an hour.
According to RBI data, there were 11,75,149 employees working in 169 scheduled commercial banks in the country as of March 2012.
UK view
Outlining the benefits of a five-day week to employees in a note, the UK’s labour department said they could have sufficient rest, time with family, and time for further studies and personal interests.

When it comes to employers, the note said the five-day work week would enhance a company’s efficiency, reduce absenteeism, enhance the enterprise’s competitiveness, and retain talent.
Link Hindu Business Line

Call for 5-day week for state banks resurfaces-

Business Standard 21.04.2014
The Indian Banks' Association (IBA) is reconsidering a long-standing demand from employee unions to keep bank branches open for only five days a week
The Indian Banks' Association (IBA) is reconsidering a long-standing demand from employee unions to keep bank branches open for only five days a week.
IBA has commissioned a study to evaluate the pros and cons of keeping banks shut on Saturdays. The staff unions, under the umbrella of the United Forum of Bank Unions (UFBU), refuse to budge on this demand, people familiar with the development told Business Standard.
The merits and the challenges of a five-day week will be placed before the new government by IBA after the general elections, sources said.
Private banks are also IBA members but might choose not to follow such a decision; this would not be so for their state-run counterparts if the government approves. In fact, the Union government had earlier rejected such a proposal on the argument that the public's perception of state-run banks would be further hit.
"Also, at a time when the government and RBI are pushing financial inclusion, reduced working hours for bank branches could be viewed as one step back," said a top executive of a public sector bank.
The staff unions say the extra working hours affecting the health and productivity of staffers. "A five-day week is already available in the international banking system. It is also available here - the Reserve Bank of India (RBI), central and state governments, and companies in the public sector work for (only) five days a week. We have been saying it should be introduced in the banking industry. The government had rejected the proposal but we have been pursuing it through UFBU," said C H Venkatachalam, general secretary of the All India Bank Employees Association (AIBEA).
Unions say such a move is unlikely to affect customer service as alternative channels of delivery - such as ATMs, net banking and phone banking - will allow individuals to conduct banking transactions on weekends. In addition, it is likely to reduce cash transactions and encourage customers to use more of electronic channels for their banking needs.
"Having five days a week will lead to higher productivity and improve the efficiency of bank employees. It will also help banks in reducing cost," said Rajen Nagar, president of AIBEA and general secretary of the Bengal Provincial Bank Employees Association.
RBI's employee union supports the demand. "The work pressure in the banking industry is the highest in the country. Hence, branch banking should be done only during weekdays, keeping in mind the health of employees and their ability to perform. Technology has ensured customers can now have access to their bank accounts 24x7, without going to branches," said Samir Ghosh, general secretary of the All India Reserve Bank Employees Association.
Branch banking at top private banks is available for six days, though some allow employees to take one compensatory leave a month for working on Saturdays. Hence, many fear state-run lenders will lose market share if private banks continue to offer branch banking for six days.
However, union members are hopeful that the five-day week for branch banking, if decided, will be introduced for all banks uniformly.by bs 21.04.2014
Link Business Standard

Bankers' Dream of 5 Day Working Shattered-By Sri Rajesh Goyal
I have been receiving reports for over a week now that new Government at the Centre is mulling with the idea of reverting to six days week or at least tweaking with the current working hours enjoyed by government employees.   I have restrained about writing on the issue as I would have been dubbed as pessimistic and I was hoping that it will remain as a rumor only.    However, today (5th June, 2014) the report in ET (New Regime Plans to Increase Working Hours) clearly indicates that reports we have received earlier were not without substance.

ET report is a major blow to Dream of Bankers for 5 Day Working in Banks.   We know that 5 day working was introduced in Central Government almost 30 years back during Rajiv Gandhi regime.  At that time I had served only for five years in bank.   We kept on dreaming for next 25 years that some day 5 day banking  will be introduced in banks too.   However, no union leaders took it seriously and  I and number of my colleagues have retired.    I still remember, in earlier days we were told that India can not be compared to western countries of 5 day banking as they have lot of ATMs and thus general public is not affected by closure of banking on Saturdays.   However, it was not a convincing argument yet I thought that whenever India will have fairly good number of ATMs, we will be able to have 5 day week at least for the next generation of bankers.   This never happened though last decade have seen mushrooming of ATMs across India.

Our readers are well aware that in my several articles, I have advised our UFBU leaders to delink this issue from wage revision as it had nothing common with wage revision.   However,  UFBU has always tried to link it with wage revision so as to befool the cadres as it was an emotive issue.    Even in the last meeting of negotiations held on 14th March 2014,  instead of discussing the increase in salaries,  their main agenda was to raise this emotive issue.   UFBU circular of the date  starts to read as  “Carrying forward the discussions held in the last round of talks, some of the important issues like introduction of 5 day Banking, regulated working hours for officers etc. were discussed further.   While appreciating our viewpoints, IBA wanted further inputs from the Unions in order to examine the issues and to take up the matter with higher authorities”. 

With a single stroke of the above ET report, now UFBU leaders will have no face to raise this issue as nobody in the IBA will even like to take this matter to higher authorities, let alone convince GoI officials to agree to such a proposal.  With much stronger government at the centre and Left parties trying to save their face, who will have the guts in IBA / UFBU to take this issue seriously in the forthcoming meetings?   Thus, the wrong strategy on the part of the UFBU has resulted in neither focusing on 5 days week nor on honourable rise in salary for the bankers.

Thus, I feel that for the time being the dream of bankers for 5 days week is shattered and UFBU needs to focus on core issue to bring bankers at par with the salaries of the central government.   If still they do not understand these basics of negotiations, then Aam Bankers may teach them a lesson in days to come by mass exodus from these old and tired unions.  The issue of 5 days working should be discussed only after completion of 10th BPS negotiations. 

Source allbankingsolutions.com

Longer working hours for bureaucrats likely

Longer in Office

Tough questions form part of new PM's plan to vet performance of top bureaucrats
How good are you -and how much do you work? The Narendra Modi government is asking these questions of senior bureaucrats and planning to put in a new appraisal and working hour system. Bureaucrats are being quietly appraised on parameters like their project delivery record, neutrality and dedication to work -plus, the Narendra Modi government is set to change a 29-year-old rule instituted by the Rajiv Gandhi government to ensure government officials put in more hours at work.At least two senior officials in know of the developments have told either by making each Saturday or alternate Saturdays a working day or sticking to the 5-day week system but extending the daily work hours on the five working days from 8 AM to 6 PM or even 8 AM to 8 PM,“ one senior official said, not willing to be identified. “An alternative could be to stick to the 5-day week system but extend the daily work hours on the five working days from 8 am to 6 pm or even 8 am to 8 pm.
The matter is being discussed,“ the official added.At present, the working hours for central government officials, as per an order issued in 1985, are 9 am to 5 am with a 30-minute lunch break and each weekend being off.Minister of State in Prime Minister's Office and Ministry of Personnel, Jitendra Singh, said he would not reveal if any move was afoot to increase the working hours for bureaucrats. “There is no official circular by us yet. If something is issued, we will duly inform you from the Prime Minister's Office,“ Singh told ET.
A silent appraisal of top bureaucrats is also on that could be the basis for a reshuffle in secretary-level and other senior positions soon. An official of Department of Personnel and Training (DoPT) aware of this exercise said bureaucrats are being assessed on four parameters: Past performance, quickness of delivery , dedication to work and neutrality. “Past performance of a period of over a decade is being taken into consideration as well as achievements specific to quick delivery of targets. Dedication to work is a key parameter and bureaucrats devoting time to hanging out at clubs or page 3 activities may find themselves out in the cold in this government,” this official told ET.
“Neutrality or political non-allegiance” is another key factor being analysed for bureaucrats who are holding senior positions in the government, the official quoted earlier said. Many bureaucrats right now in secretary-level and other senior positions are perceived to be close to the erstwhile UPA government since it was in power for the last decade and had appointed all of them to these posts.
Modi has met all secretaries to the governmen on Wednesday evening to lay out a policy map for the bureaucracy.
“What is being checked is whether the bureaucrat is neutral in his work and does not let his political preferences cloud his decision-making activity,” an official said. Modi himself works nearly 18 hours a day and his “I-mean-Business” approach is already percolating down the bureaucracy with most secretaries and other senior officials arriving in their offices sharp by 9 am and working late till 8 pm these days, very much like the new ministers. The changeover from a 6-day week to a 5-day week happened in 1985 – an initiative by the then prime minister, Rajiv Gandhi.
A May 21, 1985 order had stressed a 5-day week was important for “improving the efficiency of the administration.”


( From Mr. V. Subramanian)

It Needs To Be Eradicated. Late sitting in offices causes severest pain and discomfort not only to staff but also to to children and spouse of staff members who habitually or under compulsion sit late. 

Staff who are constrained to sit late on few occasions due to urgency of work is acceptable . But it is painful when staff who is number one flatterer or who are under fear of action sit late but who actually do not perform in proportion to late sitting hours in bank are harmful. Such lass of staff not only make their life miserable but also creates unwarranted guilty mind in those who do not like to sit late due to their attachment with their family and due to social obligation .

Nobody likes to sit late at the office except occasionally. It’s more a forced choice rather than a voluntary action on the part of the persons concerned. Late sitting occurs because of the bad organizational climate and culture. Whoever wants to sit late in the office does so, only with a view to please his boss and earn his goodwill, but loses interest and faith in late sitting, in course of time.

Another important fact is, such people do not make any significant contribution as is expected in the following areas:

(a) Increasing the output

(b) Clearing the backlog of work

(c) Solving the organizational problems

(d) Taking up certain specialized jobs or assignments that cannot be otherwise done during the regular office hours, because such jobs demand total concentration, uninterrupted functioning and special type of skills

(e) Attending to certain confidential matters

Evil effects of late sitting

The anticipated benefits in the above-mentioned area are a mere management ploy to extract more time and energy – without matching qualitative output – from the persons concerned. By sitting late, neither the persons concerned nor their institution gain anything. In fact, both tend to lose heavily. From the employees’ side, they undergo tremendous strain and stress and whatever work they do or pretend to do after regular office hours leads to losing one’s morale and motivation. From the organizational point of view, on the face of it, it may appear that extra output has been achieved. But in reality, people’s efficiency gradually comes down during the day and at one point, it tapers off.

People commit a lot of mistakes after doing hectic work for 8 continuous hours which has been the universally accepted time limit for a man day. If people are compelled to work beyond 8 hours a day and 42 hours a week, the consequences will be disastrous.

1. First, those who work for extra hours (beyond the prescribed work schedule) do not receive any worthwhile compensation and are blatantly cheated by their management.

2. Second, the people will pretend to work in the late hours, but really they will be wasting their time and precious resources of the institution.

3. The enhanced physical strain and psychological stress will reflect upon badly on the health and ability of the personnel.

4. Sensitive people will lose their self-confidence and it will hurt their ego and pride.

5. There is also a danger of their being branded as ‘slow, lazy, inefficient and obsolete’ by the management. It will affect their reputation and career progression.

6. Late sitting deprives a person of sleep for minimum duration, every day.

7. Late sitting results in accidents inside the office or outside, while on travel.

8. Only during the late hours, conspiracies are hatched, rumour mills are very active, vilification campaign is at its best, misinformation and canards are spread and frauds and malpractices are planned and perpetrated.

9. Working overtime deprives employment opportunities for the present generation youth.

10. Working for long, continuous hours make people very rigid and their behavior pattern also undergoes a change – from good to bad and bad to worse.

11. Those who work for extra hours, as proved by many empirical studies, devise their own compensation package and they try to recover the difference between the perceived ideal level and the actual level, through immoral and illegal ways. They indulge in all kinds of activities to the detriment of their parent organization.

12. At the macro level also, there is no value addition to the national economy, by asking people to work for long, continuous hours

The managements, the trade unions, the industrial bodies/associations, the statutory regulator and the government shall together sit and find a suitable exit route for this evil practice to end over a period of time, say 2 or 3 years from now

During last two  years banks have opened more than 5000 brnaches in rural areas without adding number in their total manpower . Business of banks have almsot doubled without any increase in total number of staff .In the name of Financial exclusion , management of each bank is busy in making effort to please minister and forcing available staff to work in late hours and on Sundays and holidays.As such bank staff are facing Social Exclusion in their effort to get success in Financial Inclusion

Quality of work done by such bank is therefore At   BHAGWAN BHAROSE in many branches and only future will tell the story of hidden Fraud and Hidden Bad assets


Late Sitting Only Lead TO Success in Banks?

This excellent write up from Mr. Pannvalan actually, does the same in the following lines:  

1.  Increasing the organizational output

It is only a myth that late sitting results in added output. It may result in 20% additional output, but it will be often accompanied by the following ill effects.

Click on Following Link To read More

Challenge for banks: Get people to join up, stay--Business Line



Recently, at the graduation day ceremony in a B-school near Mangalore, some students approached a former senior banker, who is the head of academic council there, for his blessings before starting off on their career in banking. He had this piece of advice for them: “Build loyalty to the organisation you work for.”
When we posed the question of loyalty to another banker, who heads the regional office of a public sector bank in Mangalore, he said: “That is for later. The first challenge is to get people to join the banking sector.”
Citing the example of his bank, he said there were over 900 vacancies for the post of officers. After completion of the selection process, hardly 200 among the short-listed candidates confirmed their willingness to join. And, finally, only 20 per cent actually joined the bank.
Lest we thought the problem was unique to his bank, he hastened to add: “This is not limited to our bank alone. It is an industry problem.”


Here is another instance: Four people joined a public sector bank in Mangalore city as probationary officers. No sooner had they joined the bank, than they started surfing the Net for better opportunities in other sectors. A banker in the know of this happening, said the new recruits were told about the benefits of a bank job vis-à-vis those in other sectors.
A fresher in an IT company gets a CTC (cost-to-company) compensation of Rs 3 lakh a year. “When we calculated the CTC for a fresher in a public sector bank in a place like Mangalore, it added up to around Rs 5 lakh a year. We considered only monetary gains and other incentives to the fresher, unlike the new-economy IT companies that take into account even the place where the fresher sits while calculating CTC,” the banker said.
Besides, banks also offer accommodation/quarters at some locations.
But these benefits don’t seem to impress many engineers and B-school graduates, for whom a bank job is only a stopgap arrangement. “They join a bank only because they want a job. And before long, quit to join elsewhere,” said a banker in Coimbatore. Bankers feel that management grads and engineers are overqualified for clerical jobs in a bank, yet they apply and get in because they want to be employed somewhere.
A public sector bank official says the trend is almost similar in the officer category too.
“Even if they join as probationary officers, they don’t stick on for long as in the past. They are invariably posted to the credit section and are set responsibilities. The present day youth is not prepared to take on the burden of responsibility. Youngsters feel their package is not commensurate with the hours they toil in the bank.”


There are some who want jobs only in the metros. If employed in banks, they will have to work in villages too. This is a different kind of challenge, said a banker. Often, when candidates join and quit shortly thereafter, the vacancies are never filled.
Secretary of Coimbatore Consumer Cause Kathirmathiyon is of the view that banks should ask for a bond to control this exodus. “Such candidates are denying the opportunity to other aspirants. If they had joined a private company, they would have had to settle their dues if they quit before serving the notice period,” he said.

‘LATE SITTING IN BANKS’ a menace asking for a serious look within.---- Collected from 

Himadri Sekhar Bhatttacharjee

‘musings of life’ renews its pledge on the eve of new year setting in, against the horrific menace tramping down all humane values, meddling with human dignity, self-respect, in our society and now, keeping in line with similar happenings worldwide,  have started to bare its  fangs in workplaces of India INC.

’WORK PLACE BULLYING’ has become the major cause of concern for HR honchos and the most exhilarating force behind ‘attrition’ in many work places of India INC.

Though we can derive solace from the fact that, ‘WORK PLACE BULLYING’ it is neither an unique happening nor happening for the first time in India and work places worldwide have already got inflicted with this menace, the dangerous fact is that, in it’s short stint in India, it could engulf Indian banks to a considerable extent.

Here, this thing is kept under wraps and have been happening in discreet forms, be it by inducing employees to work till late hours on regular basis or showering abusive phrases in ‘managers meetings’ etc.

While the world becomes vocal in rising against this menace, as seen below, India remains considerably silent.

1. Workplace Bullying Tied to More Prescriptions for Antidepressants - Test Country.com (blog)

2.Workplace Bullying Linked to Increased Use of Psychotropic - Medscape

3.On the Job: How to battle bullying at work - USA TODAY

4.Workplace bullying at its worst: employer told to pay $100000 - Lexology(registration)

‘LATE SITTING IN WORKPLACE’ a form of manifestation of ‘workplace bullying in Indian banks, where, employees are compelled to sit for late hours to appease some boss’s tendency to peg down all feelings of their fellow employees under their monumental egos, needs to be looked with awe and considerable public opinion should be formed against this menace.

Why late sittings are at all required in view of all those brouhaha on streamlining of workloads through introduction of innovative systemes, outsourcing and headfirst migration to CBS? Even female employees are compelled to stay late, overlooking their safety and conveniences.

If so warranted, the working hours itself,  can be increased, albeit, after  consultation with employees’ unions and with enhanced pay and perks for the same, woven in the pay structure.

But, when a mutually agreed ‘working hour’ is set in, why employees are to be coerced to stay beyond that,while, the pay and perks are always negotiated on the basis of the official ‘working hours’??

What shall be done to prevent/end this abhorring practice of late sitting?

The managements, the trade unions, the industrial bodies/associations, the statutory regulator and the government shall together sit and find a suitable exit route for this evil practice to end over a period of time, say 2 or 3 years from now.  It is really surprising to note that when people talk of globalization and economic liberalization, no one talks about the best labour practices being adopted and put in place in the developed countries. 
Any organization found to encourage late sitting as an integral part of organizational culture must be severely penalized.  Such organizations may be told to set aside a part of their gross income/profit for social causes like laying roads, construction of schools and hospitals and meeting the cost of new projects for the supply of drinking water and power and also ordered to pay higher taxes to the government.

The media also shall play its role more responsibly in this matter.  They shall not encourage those organizations which exploit their manpower by forcing them to sit late almost on a regular basis.  The loss of jobs due to this ugly phenomenon must be suitably highlighted and a nation-wide awareness campaign must be conducted by the media on a sustaining basis. 

The ‘late sitting’ culture harms individuals, their families, the society and the nation and it must be curbed and eradicated, so that the country’s pride will go up. 
As already stated, sitting late inside one’s office/factory does not help anyone.  The employees must shed their false belief that sitting late will fetch them greater benefits like good placement, quick promotion etc.  It is only an illusion. The time spent on working for extra hours can be utilized for more fruitful purposes like being with the family, sleeping well for minimum hours, daily commutation/travel and pursuing one’s hobbies and interests. 
If one lives one’s life, by devoting adequate time for each important aspect of one’s life in an optimum way, the nation’s health and wealth will be safe, secure and growing.  It will bring down the crime rate in the society and lead India to gaining a better score on the ‘Human Development Index’.  Are we prepared for a better India tomorrow?

Let us try to understand what Mr. Narayana Murthy, Tries to Say in the following lines:

1) Wake up, eat a good breakfast, and go to work.
2) Work hard and smart for eight or nine hours.
3) Go home.
4) Read the comics, watch a funny movie, dig in the dirt, play with your kids, etc.
5) Eat well and sleep well.


(Because you never know when it stops loving you)" - 

  -----Mr. Narayana Murthy

Please read following link to know how late sitting in bank has resulted in Social exclusion of staff while serving for Financial Inclusion