Page 7 - Banking Finance June 2023

BANK UPDATE

the March quarter at Rs 9,121.87 AU SFB net up 23% at Rs. Kotak clarified via his Twitter handle
crore. that he inadvertently used the words,
425 crore 'financial terrorist' in connection to the
Its total income moved up to Rs
AU Small Finance Bank reported 23% US dollar. "What I meant was a reserve
36,108.88 crore in the reporting quar-
on year growth in its net profit to Rs currency has disproportionate power,
ter, as against Rs 27,412.32 crore in
425 crore for the quarter ended March whether it is a nostro account, 500-
the year-ago period, while the overall
on the back of healthy growth in net basis-point rate increase, or emerging
expenses moved up to Rs 22,282.50
interest income. countries holding dollar for liquidity,"
crore from Rs 17,119.38 crore in the
Net interest income - the difference he tweeted.
year-ago period.
between interest earned and interest
The share of gross non-performing as- expanded - was Rs 1213 crore for the Govt appoints Rajneesh
sets in the overall loans was 2.81 per Q4, up 30% from the same period of
Karnatak as BoI MD,
cent as of March 31, 2023, which is an the previous financial year.
improvement from 3.60 per cent in the Chand to head BoB
The bank reported a net interest mar-
year-ago period and 3.07 per cent in The government appointed Rajneesh
gin of 6.1% during the quarter as
the quarter-ago period. Karnatak as managing director of Bank
against 6.2% in the previous quarter
and 6.3% in the year ago period. of India (BoI) while Debadatta Chand
SBI moves SC for clarity on was appointed as head of Bank of
Operating expenses also grew 27%
Baroda (BoB).
fraud classifications year-on-year to Rs 975 crore. Other
The central government appointed
operating expenses for the quarter
The State Bank of India has moved an
grew by 40% to Rs 493 crore and 59% Karnatak, Executive Director, Union
application before the Supreme Court Bank of India, as managing director
for FY23 to 1647 crore.
seeking clarifications on the judgment
and CEO of Bank of India for three
on fraud classification of borrowers, years with effect from date of assump-
Rupee can be a reserve
and urged the court to clarify whether tion of office, Department of Financial
currency, says Kotak
banks can decide on the time frame of Services said in a notification.
adjudication depending on the urgency Uday Kotak called this an opportune
Karnatak replaces Atanu Kumar Das
of a matter. moment for the rupee to gain reserve
who completed his three-year term in
currency status.
While upholding a Telangana high court January this year. In a separate notifi-
order, the top court had held that Kotak said an alternative to the US cation, DFS said Chand, currently ED of
dollar was needed as the reserve cur-
banks must hear a borrower before BoB, has been appointed as managing
rency has the power to control "all our
classifying an account as fraudulent. director of the same bank for a period
money in nostro accounts and one of three years.
Due to the serious civil consequences
morning someone can say that we
for a borrower associated with the
cannot withdraw and we are stuck". Exim Bank to raise to
classification of an account as fraud,
the directions must be construed rea- According to him, no other currency record $4 billion this fiscal
qualifies for reserve status. "Europe
sonably by applying the principles of
year
can't (make their currency the reserve)
natural justice, the SC had observed.
Exim Bank plans to raise up to record
because it is the 'disunited states of
The move was supposed to include $4 billion in financial year 2023-24
Europe'. I don't think the UK or Japan
more safeguards for state-owned (FY24) for extending trade finance and
have the heft to take that position,
banks.SBI has sought to limit the scope term loans.
though the British pound and the yen
of 'personal hearings' by urging the are free currencies. China has a major Harsha Bangari, managing director of
court to allow banks to share only rel- issue of trust with many countries the export credit agency, said the
evant extracts of the forensic audit around the world. It is our chance to fundraising would depend on market
reports with borrowers instead of the take a shot at becoming the reserve conditions. Exim, which raised $3.47
full reports. currency of the world," said Kotak. billion in FY23, has a broad investor
BANKING FINANCE | JUNE | 2023 | 7