BANK
FINANCIAL MANAGEMENT
UPDATES
Page No.
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Chapter No.
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Contents
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Update
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6
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1.2
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Global Forex Business
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The Global Forex markets turnover in April
2013 was USD 5.3 Trillion per day.
Rupee trades account for about 1 per cent of the global market with a
daily average turnover of about USD 53 billion.
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16
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1.6
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RBI/FEDAI Guidelines – No of Dealers
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At present, there are 100 category-I Authorised
Dealers in India.
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52
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3.5.1
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NRE A/cs Jointly with Resident Indians
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Non-Resident Indians (NRI), are
now permitted to open NRE / FCNR(B) accounts jointly with their resident
close relatives (relative as defined in Section 6 of the Companies Act, 1956)
with operational instructions ‘former or survivor’, where NRI is
‘Former’. The resident close relative shall be eligible to operate the account
as a Power of Attorney holder.
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53
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3.5.1
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Interest payable on NRE SB and Term Deposits
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Banks are free to determine their
interest rates on both savings deposits and term deposits under Non-Resident
(External) Rupee (NRE) Deposit accounts and savings deposits under Ordinary
Non-Resident (NRO) Accounts with effect from December 16, 2011. However,
interest rates offered by banks on NRE and NRO deposits cannot be higher than
those offered by them on comparable domestic rupee deposits.
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53
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3..5.1
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Tenor of NRE Term Deposits
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Similar to Resident Term Deposits, but with a
minimum period of one year.
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54
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3.5.3
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FCNR(B) Deposits - Currencies
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FCNR(B) accounts are now
permitted to be opened in any freely convertible currency. The commonly used
currencies, however, are USD, GBP, Euro, JPY, AUD and CAD.
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54
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3.5.3
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FCNR(B) Deposits – Joint accounts with
resident Indians
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Non-Resident Indians (NRI), are
permitted to open NRE / FCNR(B) accounts jointly with their resident close
relatives (relative as defined in Section 6 of the Companies Act, 1956) with
operational instructions ‘former or survivor’, where NRI is ‘Former’. The resident
close relative shall be eligible to operate the account as a Power of
Attorney holder.
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54
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3.5.3
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Tenor of FCNR(B) Deposits
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FCNR (B) deposits can be accepted for a
minimum period of 1 year and a maximum of 5 years.
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55
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3.5.3
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Interest payable on FCNR(B) deposits
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As directed by RBI from time to time. Present
maximum rates effective from 01.03.2014 are:
Period Rate
1 year upto less than
3 years LIBOR + 200
bps
3years to 5 years LIBOR + 300 bps
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58
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3.7
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Loan/Advances against NRE/ FCNR(B) deposits
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Effective from 12.10.2012, there is no ceiling
on the quantum of finance against NRE /FCNR deposits.
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93
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3B
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Realisation of Export Bills
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The period of realization and
repatriation of export proceeds shall be nine months from the date of export
for all exporters including Units in SEZs, Status Holder Exporters, EOUs,
Units in EHTPs, STPs & BTPs until further notice.
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98
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5.4.1.A.10
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Interest rates on Pre-Shipment Finance
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The Base Rate System is
applicable with effect from July 1, 2010. Accordingly, interest rates
applicable for all tenors of rupee export credit advances are subject to, at
or above Base Rate.
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103
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5.4.2
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Period of Finance
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Normal Transit Period (NTP) is
as specified by FEDAI from time to time.
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104
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5.4.4.1
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Rate of interest for Export Credit in Foreign
Currency
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Banks are free to determine the
interest rates on export credit in foreign currency with effect from May 5,
2012
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104
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5.4.4.2
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Rate of interest for raising Foreign Currency
funds for financing Export
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From November 15, 2011, Banks may
arrange for borrowings from abroad for the purpose of grant of PCFC to
exporters without the prior approval of the RBI, provided the rate of interest
on the borrowing does not exceed 250 basis points over six months LIBOR/EURO
LIBOR/EURIBOR
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111
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5.7(e)(i)
&(ii)
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Advance Remittance for Imports
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ADs may allow remittance of advance payment
against import of goods upto USD 200,000 or its equivalent, after duly
satisfying about the transaction, nature of trade and standing of the
supplier, etc. In case of an importer entity in the Public Sector or a
Department / Undertaking of the Government of India / State Government/s the
limit is USD100,000.
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114
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5.9.2
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Interest rate ceiling on Buyers’ Credit
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The present ceiling on all-in-cost is 350 bps
over 6 months LIBOR for all maturities upto 1 year, over 1 year upto 3 years
and over 3 years upto 5 years.
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148
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7.3.1.B.(iv)
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Remittance for Consultancy Services
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Remittances for consultancy
services from outside
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149
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7.3.1.c(v)
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Eligible Investors abroad
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Indian party has been permitted
to make investment in overseas Joint Ventures (JV) / Wholly Owned
Subsidiaries (WOS), as per the ceiling prescribed by the Reserve Bank from
time to time. An Indian party means a company incorporated in
With effect from July 03, 2014,
the limit of Overseas Direct Investments (ODI)/ Financial Commitment (FC) to
be undertaken by an Indian Party under the automatic route has been restored
to the limit prevailing, as per the extant FEMA provisions, prior to August
14, 2013. However, any financial commitment exceeding USD 1 (one) billion (or
its equivalent) in a financial year would require prior approval of the
Reserve Bank even when the total FC of the Indian Party is within the
eligible limit under the automatic route (i.e., within 400% of the net worth
as per the last audited balance sheet)
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153
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7.4.A
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About FEDAI
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The total membership of FEDAI upto February
2015 is 106.
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157
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7.5.1(i)
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Interest rate on ECB
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For average Maturity Period of
three years and up to five years all-in-cost Ceilings over 6 month LIBOR 350
basis points and for more than five years 500 basis points
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407
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22
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Capital
Adequacy – The Basel-II Overview
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Basel
III Capital Regulations are being implemented in
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