Financial Awareness for RBI Grade B-26 July 2017
RBI stops printing Rs 2000 notes, focus turns to new Rs 200 notes (Source: MINT)
- The Reserve Bank of India (RBI) stopped printing Rs 2000 notes about five months ago and is unlikely to print more in the current financial year. About 3.7 billion Rs 2000 notes amounting to Rs 7.4 trillion have been printed so far. That more than compensates for the 6.3 billion Rs 1000 notes that were withdrawn after demonetisation.
- Separately, RBI’s printing press in Mysuru has also started printing the new Rs 200 notes, which are likely to come into circulation next month.
2. Monnet Ispat: NCLT appoints administrator for bankruptcy proceedings (Source: MINT)
- Allowing the plea of the consortium of lenders led by SBI, the National Company Law Tribunal (NCLT) has appointed interim resolution professional (IRP) to initiate bankruptcy proceedings against Monnet Ispat & Energy Ltd.
- NCLT’s order follows a petition filed by bankers led by State Bank of India against Monnet Ispat and Energy Limited under the Insolvency and Bankruptcy Code, 2016.
3. Finance ministry prepares to bailout debt-ridden telecom firms (Source: MINT)
- As part of a bailout package for the telecom industry, the finance ministry is considering relaxing some of their payment obligations, on the logic that a robust sector is good for government finances as well.
- The finance ministry’s inclination to offer telcos some relief comes in the wake of the tepid response to the last round of spectrum auctions in October, in which some of the bands received no bids. The government collected 20% less than its targeted non-tax revenue from the sector in 2016-17 at Rs78,715 crore. For 2017-18, the ministry has conservatively estimated its receipts from the sector at Rs44,342 crore.
- Besides, easier payment options found favour with the government as it does not want the problem of bad debt to the tune of Rs9.6 trillion in the economy to worsen on account of the telecom sector.
4. 10 PSU banks submit turnaround plans (Source: BS)
- As many as 10 state-owned banks- Bank of India, IDBI Bank, Union Bank, Allahabad Bank, Andhra Bank, Central Bank of India, Dena Bank, UCO Bank, United Bank of India and Bank of Maharashtra have submitted their turnaround plans to the government, which is a pre-requisite for getting fund infusion. Indian Overseas Bank is currently in the process of preparing its turnaround plan.
- Any future capital infusion in these banks shall be subject to achievement of select agreed upon milestones according to the turnaround plan on a quarterly basis.
5. ICRA sees 25 bps cut in repo rate at next month’s policy review (Source: BL)
- The Monetary Policy Committee (MPC) of the Reserve Bank of India (RBI) may reduce the repo rate by 25 basis points (bps) at its upcoming policy review on August 2017, according to credit rating agency ICRA.
- With the CPI inflation easing below the 2 per cent floor of the inflation target band in June 2017, a reasonably favourable progression of the monsoon and Kharif sowing so far, and limited evidence of a knee-jerk rise in prices following the imposition of the goods and services tax (GST), there is a high likelihood that the MPC would vote to reduce the repo rate by 25 bps in their upcoming meeting.
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