FRIDAY, MARCH16, ECONOMIC SURVEY: BANKS MAY BE INDIRECTLY AFFECTED BY EURO-ZONE CRISIS
Though Indian banks' exposure to the troubled euro zone is negligible, funding pressure could impact them, Economic Survey 2011-12 said.
"The recent regulatory prescriptions for European banks have raised fears of deleveraging. Indian banks are not expected to bear any direct impact on account of their negligible exposure to the troubled zone," the survey tabled by Finance Minister Pranab Mukherjee said.
"However, they could be indirectly affected on account of funding pressures," it said.
The scope for countercyclical financial policy could be explored in financial regulations in order to minimize negative impact of accumulated financial risks, it said.
This will go a long way in providing needed stability to the financial system, it added.
The survey noted sovereign risk concerns, particularly in the euro area, affected financial markets for the greater part of the year, with the contagion of Greece's sovereign debt problem spreading to India and other economies by way of higher-than-normal levels of volatility.
"The recent regulatory prescriptions for European banks have raised fears of deleveraging. Indian banks are not expected to bear any direct impact on account of their negligible exposure to the troubled zone," the survey tabled by Finance Minister Pranab Mukherjee said.
"However, they could be indirectly affected on account of funding pressures," it said.
The scope for countercyclical financial policy could be explored in financial regulations in order to minimize negative impact of accumulated financial risks, it said.
This will go a long way in providing needed stability to the financial system, it added.
The survey noted sovereign risk concerns, particularly in the euro area, affected financial markets for the greater part of the year, with the contagion of Greece's sovereign debt problem spreading to India and other economies by way of higher-than-normal levels of volatility.
Thursday, March 15, RBI LEAVES REPO, REVERSE REPO RATES & CRR UNCHANGED, FLAGS INFLATION RISKS
RBI left interest rates unchanged and warned of resurgent inflation risks, a hawkish stance that disappointed investors clamoring for the first rate cut since the aftermath of the global financial crisis.
The Reserve Bank of India kept its policy repo rate on hold at 8.50 per cent, as had widely been expected. It kept the cash reserve ratio unchanged at 4.75 per cent after a 75 basis point-cut in a surprise off-cycle move to ease tight banking system liquidity.
While market hopes had risen that the RBI would finally begin lowering rates after 13 increases between March 2010 and October 2011, it opted not to make a move before federal budget release for the fiscal year starting April 1.
The Reserve Bank of India kept its policy repo rate on hold at 8.50 per cent, as had widely been expected. It kept the cash reserve ratio unchanged at 4.75 per cent after a 75 basis point-cut in a surprise off-cycle move to ease tight banking system liquidity.
While market hopes had risen that the RBI would finally begin lowering rates after 13 increases between March 2010 and October 2011, it opted not to make a move before federal budget release for the fiscal year starting April 1.
Wednesday, March 14, INFOSYS TO DOUBLE PRODUCT R&D ENGINEERS TO 1,000 IN INDIA
Infosys on said it plans to double headcount at its product research and development (R&D) team to 1,000 in the next two years to accelerate design and development of solutions.
The team is responsible for developing products and platforms, leveraging technologies in the areas of cloud computing, mobility, analytics, and social media.
"The focus of Infosys 3.0 strategy is on creation of innovative products leveraging technologies like cloud computing, mobility, analytics, and social media. A competent team is a core requirement and therefore we are looking at expanding the present team of 500engineers to 1,000 over the next two years," said Infosys Senior Vice President and Head of Infosys Labs and Product R&D Subu Goparaju
The team is responsible for developing products and platforms, leveraging technologies in the areas of cloud computing, mobility, analytics, and social media.
"The focus of Infosys 3.0 strategy is on creation of innovative products leveraging technologies like cloud computing, mobility, analytics, and social media. A competent team is a core requirement and therefore we are looking at expanding the present team of 500engineers to 1,000 over the next two years," said Infosys Senior Vice President and Head of Infosys Labs and Product R&D Subu Goparaju
Tuesday, march 13, INDIA INC IT SPEND TO RISE IN 2012; COS PREPARE TO TAKE ON GLOBAL RIVALS WITH SOPHISTICATED SYSTEMS
India Inc is preparing to spend more on IT in 2012 as it goes global and takes on rivals with more sophisticated IT systems and also cater to local growth and demand.
Asian Paints, for instance, plans to spend more on IT systems as it sets up its largest manufacturing plant this year and invest in equipping its sales people with tablets and integrating those devices with its sales force automation software.
Firms such as these are set to boost IT spending in India in 2012 even as many of their counterparts in Europe and US hunker down and prepare for a hard year, growing their IT investments at a slower pace than before.
Asian Paints, for instance, plans to spend more on IT systems as it sets up its largest manufacturing plant this year and invest in equipping its sales people with tablets and integrating those devices with its sales force automation software.
Firms such as these are set to boost IT spending in India in 2012 even as many of their counterparts in Europe and US hunker down and prepare for a hard year, growing their IT investments at a slower pace than before.
Every second firm in India plans to increase IT budgets in 2012, according to researcher Gartner, with some of the priority areas for investment being customer relationship management, e-mail and calendaring, web and business intelligence tools. "India is one of the fastest growing IT services markets and has become the focus for service providers," said Arup Roy, principal analyst with Gartner.
Monday, March 12, INDIAN BANKS TO POST WEAK OPERATING PERFORMANCE IN FY'13
Indian banks is likely to post a weak operating performance in the fiscal year ending March 31, 2013, according to ratings firm Standard and Poor's because of slowdown in economic growth, a dip in credit growth, rising delinquencies, and tighter margins could cause a deterioration in performance.
"The asset quality of Indian banks is likely to remain weak, or even deteriorate, due to the moderation in economic activity, high inflation, and high interest rates," said Standard & Poor's credit analyst Geeta Chugh.
"We expect restructured loans to rise in fiscal years 2012 and 2013. Small and midsize companies are particularly vulnerable."
According to the report, credit growth in India is likely to weaken to 16%-17% in fiscal years 2012 and 2013, from about 23% in fiscal year 2011.
Standard & Poor's expects net interest margins of Indian banks to remain tight in fiscal year 2013 due to intensifying competition amid low credit growth, and borrowers' limited ability to absorb higher interest rates.
No comments:
Post a Comment