Page 9 - BF Cover February 2019

RBI CORNER

Banks lost Rs.41,167 cr to fraud in 2017-18 RBI report Women's share in deposits

Fraudsters have laundered Rs 41,167.7 crore from loans growing: RBI study
the banking system in 2017-18, a significant jump of The share of women in total credit
72 per cent from Rs 23,933 crore the previous year, and aggregate deposits of individu-
despite "stringent monitoring and vigilance", ac- als increased further to 20.4 per cent
cording to data released by the Reserve Bank of India and 32.8
(RBI). per cent,
There were 5,917 instances of bank fraud in 2017-18 as against 5,076 cases the respec-
previous year, show the data released Friday. The instances of fraud have been tively, in
March
rising over the last four years - by four times from Rs 10,170 crore in 2013-14.
2018 from
In 2017-18, however, frauds related to off-balance sheet operations, foreign 19.3 per cent and 32.0 per cent a
exchange transactions, deposit accounts and cyber-activity took centre stage. year ago, the Reserve Bank of India
Banks reported more cyber frauds during the year, losing Rs 109.6 crore in 2,059 (RBI) has said.
cases in 2017-18 as against Rs 42.3 crore with 1,372 cases the previous year.
"In March 2018, there were nearly
Large-value frauds involving Rs 50 crore and above constituted about 80 per 0.20 billion loan accounts and 1.91
cent of all the frauds reported this year. Significantly, 93 per cent of fraud cases billion deposit accounts, of which,
worth more than Rs 1 lakh occurred in PSU banks while private banks accounted 0.24 billion were in term deposits,"
for six per cent. The increasing number of frauds has contributed to the bal- the RBI said in data released. Met-
looning bad loans, which were at Rs 10,39,700 crore as of March 2018. ropolitan areas, which had less than
20 per cent of branches, accounted
The jump in 2017-18 was primarily due to the over Rs 13,000-crore Punjab for nearly 52 per cent of total depos-
National Bank (PNB) case, involving fugitive businessmen Nirav Modi and Mehul
its and 64 per cent of bank credit, it
Choksi. "In terms of amount, frauds in the banking sector increased sharply in said.
2017-18, mainly reflecting a large value case in the jewellery sector," the RBI
Industrial credit growth picked up
said.
during 2017-18 after witnessing de-
RBI rationalises framework for ECB cline during the previous two years,
whereas personal loans segment
RBI has decided to rationalise the current framework for external commercial
continued to record strong growth.
borrowings and Rupee denominated bonds to further improve the ease of do-
ing business. The RBI has allowed borrowers to raise up to "Private sector banks recorded
$ 750 million a year and expanded the list of borrowers healthy growth in loan portfolio and
eligible to raise ECBs. All eligible borrowers can now raise their share in total bank credit im-
proved significantly," the RBI said.
ECBs up to $ 750 million or equivalent per financial year
The share of savings deposit in total
under the automatic route replacing the existing sector
deposits has gone up further during
wise limits, the RBI said. The rules have been changed in
the year, on top of high growth dur-
consultation with the Government of India, it said.
ing 2016-17 when demonetisation
The RBI has decided to merge Tracks I and II under the existing ECB framework generated a sudden jump in the
as "Foreign Currency denominated ECB" and Track III and Rupee Denominated share of savings deposits.
Bonds framework are combined as "Rupee Denominated ECB" to replace the The share of term deposits has been
current four-tiered structure. "The framework is instrument-neutral," the Cen- declining gradually during the last
tral Bank said in a circular. It has also expanded the list of eligible borrowers. five years, it Reserve Bank report
The list will include Port Trusts, units in SEZ, SIDBI, EXIM Bank, registered enti- said. Nearly 45 per cent of term de-
ties engaged in micro-finance activities, viz., registered not for profit compa- posits in March 2018 accrued in the
nies, registered societies/ trusts/ cooperatives and non-government original maturity bucket of 'one year
organisations. and above but less than two years.

BANKING FINANCE | FEBRUARY | 2019 | 9