FINANCIAL INCLUSION: GREATER ROLE FOR CO-OP BANKS.

The Co-operative banks, in India, have a history more than 100 years. The Co-operative banks are an important constituent of the Indian Financial System.
Co-operative banks have certain advantages compared to scheduled commercial banks, in cost of operation, geographical reach and relationship banking (a rare commodity for ordinary customers in the changed banking scenario).
Role of co-operative banks are very important in the real last-mile financial inclusion. They can play a greater role than scheduled commercial banks in achieving the goals of financial inclusion, according to Uma Shanker - General Manager, RBI, (Urban Co-operative Banks Department).
At gross root level, these banks understand the needs of the needy better, and can play a larger role in financial inclusion.
Co-operative banks have to use advanced technology and recruit efficient people to compete with commercial banks.

NO STOPPING OF U S BANK FAILURES

The Park Avenue Bank, a New York City-based institution, was among three banks seized by regulators on Friday, and is the second area bank to fail in two days.

The other banks seized on Friday were small institutions in Florida and Louisiana, and brought the total number of failures so far this year to 30.

PERSISTENT IPO - INVEST

Persistent Systems commands a strong position in the OPD space by virtue of its ability to offer solutions across each stage of product development. The company has significant domain expertise in telecommunications, life sciences and healthcare and in infrastructure. Good business model. Strong corporate governance architecture with two of the independent directors on board since 2001. Good operating margins. Strong team of highly skilled professionals and management. CRISIL has awarded grade -4 indicating above average fundamentals. At the upper band of Rs 310, Persistent would be trading at P/E 16 on FY 09 earnings. The issue is very attractively priced. INVEST.

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CRACK DOWN IN PAK CRICKET – SIMILAR ACTION AGAINST TERRORISTS

In an unprecedented and ruthless administrative exercise, the Pakistan Cricket Board has banned, warned, suspended and fined the senior cricketers for poor performamence, indiscipline and mis behavior. Yonis Khan and Mohammad Yousuf have been indefinitely banned. Discipline is necessary in any sports and the board action is justified.

Pak is the epicenter of international terrorism. The 11/09 and 26/11 attacks were carried out by the terror outfits, having very strong roots in Pak. Will the establishment in Pak, take similar action against those terrorist organizations. This will help the Pak to regain their political credibility, worldwide. It is time to act for the establishment.

CARLOS SLIM REPLACES WARREN BUFFET AS THE RICHEST – 2010

Mexican telecom tycoon Carlos Slim made it to the top on the 2010 Forbes list of billionaires, replacing the legendary Warren Buffet.
Mukesh Ambani and steel tycoon Lakshmi Mittal made it to the top 10 on the 2010.
Ambani ranked fourth with $29 billion and Mittal ranked fifth with $28.7 billion on the Forbes list of billionaires.

HOME LOANS SHOULD BE OUT SIDE THE BASE RATE

The base rate, which will replace the current benchmark prime lending rate (BPRL) from July 1, should keep the all categories of home loans out side the base rate. Currently, home loans are offered at 8.5% p.a. The base rate is expected to be around 10% p.a. Even an increase of one percent in interest rate will push up the EMI of housing loans substantially, since the tenure of the loans ranges from 10 to 25 years. A shelter for themselves is what the middle class and the poorer section of the society always want to own. Affordable housing loans should be made available to these deserving sections of the society. The economics of cost of funds for banks, while lending to this section, must be kept out of the purview.

WOMEN RESERVATION BILL

There is apprehension in some quarters of the Congress that if the bill is passed, the party may lose allies it may need later. The so-called allies who are supporting the UPA from out side are – RJD and SP. The BSP may vote in favor or abstain on some frivolous reason. There are number of small parties and independents who will support the bill, which is pending since 1996. On the pretext of sub quota for OBCs and minorities, the Yadavs moving heaven and earth to stall the same. The Congress should ignore the threat of Yadavs and get the bill passed in both the houses. There is already dissent in JD (U) and the Bihar chief minister Nitish Kumar has come out in support of the bill. The Congress need not worry about the remaining tenure of the UPA. Even if RJD and SP withdraw their support, the UPA will have comfortable majority in the Lok Sabha.

BASE RATE FROM JULY 1, 2010

The RBI, which had set the April 1 as the deadline for banks to migrate to the base-rate regime, has given the banks a three-month breather to move to base rate. The loans against fixed deposits, staff loans and DIR loans are exempted from base rate. While determining the base rate banks have to take into account the cost of deposits, adjustments for negative-carry for CRR and SLR, unallocated overhead costs. Bankers request for lending below the base rate for corporates (short term) was not considered fauvorably by the RBI.

STILL IN DEEP WATERS

With the exception of Paramount Airways and Indigo Airlines, all other airlines reported losses for the financial year 2008-09. The national carrier, Air India reported the highest loss of Rs 5548cr. The following table shows the profit/loss reported by other airlines.

(Rs in Cr)
NAME OF THE AIRLINE PROFIT/LOSS

Kingfisher -1602
Jet Airways -402
Go Air -23
Spice jet -353
Jetlite -630
Paramount Airways +7
IndiGo +82


Indian and international air travel has rebounded from last year's slump because of an economic pick-up. Domestic Indian travel jumped 23 per cent in January to 4.1 million passengers, according to the Civil Aviation Ministry. Worldwide international airline passenger traffic rose 6.4 per cent that month, to the International Air Transport Association.

The last quarter of 2009 and early signs in 2010 gives an indication that the worst could be over, if the present growth is maintained, the Indian aviation sector is on a strong path of recovery by the beginning of 2011.

However, Air India is still struggling amid the upturn as its debt had more than doubled after paying for 100 odd new planes. The government last month approved Rs 800cr cash injection into Air India.

IT HAPPENS ONLY IN INDIA

It was saddening to note the death of 63 people, mostly women and children, in a stampede incident at an ashram in Kunda, Uttar Pradesh. The number may go up to 100, since many are still battling for life in the hospital. Stampedes at temples and other religious places in India have claimed more than 700 lives in the last eight years. Now the state government will order an enquiry, like most of the enquiry, nothing will come out and no action is going to be taken against the people responsible.