The history of CG and its functioning does give us some lessons. First, we should avoid multiple agencies handling different CGs. Second, the RBI or RBI-governed institutions generally fare better at financial tasks compared to the government and its agencies. The government should closely work with the RBI and heed its advice on not just CGs but other aspects of the fiscal stimulus as well, which relies greatly on the banking system. Third, we should be careful of moral hazard problems. This does not imply that one should not lend, fearing moral hazard. It is just that CG should not result in loan appraisals and follow-up not being done properly. Indian banking is already struggling with high NPAs and banks should take care to avoid any further rise. … [Read more...] about Credit guarantees of 1970s make a comeback
Credit score by percentile
Higher treasury income (stake sale of Yes bank) and NIM expansion led to strong 29% sequential growth in Federal Bank’s Q4 operating profits. Higher provisions (incl. `930m Covid-related) led to a ~32% q/q decline in earnings. Asset quality and PCR improved. Ahead, higher build-up of stress would keep credit cost high and profitability subdued in the medium term. … [Read more...] about Buy Federal Bank target of Rs 55: Anand Rathi
At present, remittances for normal imports (excluding import of gold/diamonds and precious stones/jewellery) into India are required to be completed within a period of six months from the date of shipment by the overseas supplier, except in cases where amounts are withheld towards guarantee of performance. … [Read more...] about COVID-19 impact: RBI announces measures to support foreign trade
A bond exchange-traded fund (ETF) is a type of ETF that exclusively invests in bonds/ a basket of bonds in the underlying index. It can invest in the government, corporate, or public sector unit bonds.Why should I invest in Bharat Bond ETF?A. It offers multiple benefits to conservative debt-fund investors who wish to save for the long term. It has a relatively high-quality portfolio of select public sector companies, it is cheaper with extremely low expense ratio and it offers a tax-efficient return compared to other options such as bank fixed deposits. … [Read more...] about Bharat Bond ETF second tranche to launch in July: All your questions answered
Simply Save podcast | Can debt funds really assess credit risk? Coronavirus Essential podcast | Kerala see another wave of infections; MHA refutes lockdown 5.0 claims; SC takes note of migrant issue Taking Stock | Market rises for second day in a row; investors richer by nearly Rs 2 lakh cr in a day … [Read more...] about Coronavirus Essential podcast | RBI’s push to revive economy, does COVID-19 spread through corpses?