Banking Updates

Loans against property (LAP) allow property owners to leverage their assets to secure large loans for personal or business needs without relinquishing ownership. The interest rates for these loans start at 9.5% per annum. Here’s a look at some of the best rates currently available: Interest Rates Overview: HDFC Bank:  Offers the lowest interest rates starting from 9.50%. For a Rs 15 lakh loan over a 7-year term, the EMI is approximately Rs 24,323. State Bank of India (SBI):  Charges interest rates beginning at 10.10%. The EMI for a Rs 15 lakh loan with a 7-year tenure amounts to around Rs 24,771. Indian Bank:  Also starts at 10.10%, with a similar EMI of Rs 24,771 for a Rs 15 lakh loan over 7 years. Other Banks' Rates: Axis Bank:  Interest rates start at 10.50%, leading to an EMI of Rs 25,072. Union Bank of India:  Offers rates from 10.55%, with an EMI of Rs 25,109. Bank of Baroda:  Starts at 10.85%, with an EMI of Rs 25,336. Canara Bank:  Charges 11.0...

Narayanan Vaghul, a towering figure in Indian banking and the former Chairman of ICICI Bank, passed away on Saturday in Chennai at the age of 88. His death marks the end of an era for Indian financial services, where his legacy has had a profound and enduring impact. Vaghul is survived by his wife, daughter, and son. His contributions to the banking sector are widely celebrated, and he was honored with the Padma Bhushan award, one of India's highest civilian honors, for his exceptional service to the nation. Dubbed the ‘Bhishma Pitamah’ of Indian banking, Vaghul’s tenure at ICICI Limited began in 1985, during which he spearheaded its transformation from a development bank into the country’s second-largest commercial bank. This metamorphosis established ICICI as a significant player in various financial services, including commercial banking, insurance, investment banking, and mutual funds. ICICI Bank's tribute to Vaghul on X (formerly Twitter) reflects his monumental contributi...

The State Bank of India (SBI), the country’s largest lender, has recently increased interest rates on short-term retail fixed deposits (FDs) by 25 to 75 basis points (bps). This marks the first adjustment in fixed deposit rates by SBI since December 2023 and is anticipated to prompt similar actions from other banks. Interest Rate Adjustments The new rates for retail domestic term deposits, which are under ₹2 crore, reflect a significant increase: For FDs maturing between 46 to 179 days : The interest rate has risen from 4.75% to 5.5%, an increase of 75 bps. Senior citizens will now receive 6%, up from 5.25%. For FDs maturing between 180 to 210 days : The rate has been adjusted to 6%, from 5.75%, with senior citizens seeing a rise from 6.25% to 6.5%. For FDs maturing between 211 days to one year : The interest rate has increased to 6.25%, from 6%. Senior citizens will benefit from a rate hike to 6.75%, up from 6.5%. SBI has also raised interest rates on bulk term deposits (₹2 crore and ...

The Reserve Bank of India (RBI) has unveiled a draft framework aimed at tightening project financing norms, which proposes a significant increase in standard asset provisioning requirements. The new guidelines could substantially impact the financial health of banks and non-banking finance companies (NBFCs) involved in project finance. Key Aspects of the Proposed Framework Increased Standard Asset Provisioning The RBI’s draft framework suggests raising the general provisioning requirement to 5% of the funded outstanding for all project finance loans. This is a significant increase from the current standard provisioning of 0.4%. For projects in the operational phase, the provision can be reduced to 2.5% if the project meets certain criteria, such as having a positive net operating cash flow and a reduction in long-term debt by at least 20% from the outstanding amount at the Date of Commencement of Commercial Operations (DCCO). Impact on Financial Ratios Capital Adequacy : The increased ...