magshortapr10.doc

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BANKING eventsUPDATE The window onbanking in India

Vol XII1 No.04Apr 2010

(for HARD COPY of the news-magazine, readers may contact us at !"# #$$%$#& ' ndiaor visit our we)site www*)an+ingindiaudate*com

Special Issue on Ta !a""ers

#EAD A$TI%#E

&inancial S"a'ili"( $epor"RBI had established a Financial Stability Unit in August, 2009 which is required to submit a eriodicFinancial Stability Reort !FSR", to enhance transarency and augment con#idence in the #inancial system$RBI ublished the %st FSR on &ar 2', 20%0, which is an attemt at institutionalising the imlicit #ocus and

ma(ing #inancial stability, an integral dri)er o# the olicy #ramewor($&ocus ) *he FSR #ocuses on re)iewing the nature and imlications o# ris(s ha)ing bearing on themacroeconomic en)ironment, #inancial institutions, mar(ets and in#rastructure$ It also assesses theresilience o# the #inancial sector through stress tests$ RBI e+ects

..for Complete feature, you can refer to the Printed Version of the magazine.

BANKING P*#I%+

ST$IPSRBI has decided to introduce !&ar 2', 20%0" Searate *rading # Registered Interest And -rincial #Securities !S*RI-S" in .o)t securities as art o# the e##orts to de)elo the .o)t securities mar(et$ S*RI-Sin .o)t securities will ensure a)ailability o# so)ereign /ero couon bonds, which will lead to thede)eloment o# a mar(et determined /ero couon yield cur)e !11"$ S*RI-S will also ro)ideinstitutional in)estors with an additional instrument #or their asset3liability management$ Further, asstris ha)e /ero rein)estment ris( !discounted instruments with no eriodic interest ayment therebyob)iating the need #or rein)estment o# intermediate cash #lows arising out o# the in)estment", they canbe attracti)e to retail4non3institutional in)estors$


BASI% BANKING ISSUES

Ta $a"es ,or 2010-11ncome .a/ Ratesa ndividua0s, Hindu 1ndivided 2ami0ies, AoP and 3ody of ndividua0s

Basic exemption limit - Rs.160000, Tax rate above Rs.160000 p to Rs.! lac- 10",

Tax rate above Rs.! lac p to Rs.# lac - $0", Tax rate above Rs.# lac - %0"

&1' Resident woman below the age o( 6! )ears, the basic exemption limit is I*R 1+0,000

&$' Resident o( the age o( 6! )ears or above, the basic exemption limit is I*R $0,000

&%' rcharge is not applicable. dcation cess is applicable / %" on income-tax


2/19

) 2or Co-oerative 4ocieties5 p to I*R 10,000 10". 10,001 to $0,000 - $0". $0,001 andabove %0". rcharge not applicable. dcation cess / %" on income-tax.

c 2or 6oca0 Authorities 5 %0". rcharge not applicable. dcation cess / %".

d 2or 2irms (inc0uding 6imited 6ia)i0ity Partnershi5 / %0". rcharge is not applicable.dcation cess is applicable / % percent on income-tax.



3/19

BANKING &EATU$ES


4/19

Serice TaSerice Ta is a ta+ le)ied on the transactions o# certain seci#ied ser)ices by the 1entral .o)t under theFinance Act, %995$ It is an indirect ta+ due to which the ser)ice ro)ider ays the ta+ and reco)ers theamount #rom the reciient o# ta+able ser)ice$

Au"/ori"( "o le( serice "a ) 6ntry 97 o# Schedule 8II o# the 1onstitution o# India, authorises the

1entral .o)t to le)y ser)ice ta+ through 1hater 8 o# the Finance Act, %995$ *he ta+able ser)ices arede#ined in section ' o# the Finance Act, %995$

Taa'le serices ) :oti#ication o# such ser)ices is done by 1entral .o)t and modi#ied #rom time to time$



5/19

BANKING &EATU$ES


6/19

Ipor"an" $e"urns calle '( $BIRBI has been calling arond $$% retrns (rom commercial banks on varios aspect o( banking bsiness.

These retrns range (rom opening o( branches to di((erent t)pe o( bsiness, compliance with prdentgidelines, annal balance sheet etc. The periodicit) o( sch retrns is (rom dail) to annl. ome o( theimportant retrns are listed below

1- 2orm - 3III tatement o( demand and time liabilities (or calclation o( 4R - (7onth0y

$- 2orm-5 2inal &ec.$' 2or compilation o( monetar) aggregates, commercial bank srve), compilationo( *RI deposits, comptation o( RR (2ortnight0y

% -Balance heet 5nal)sis 5dited acconts o( the bank with notes on acconts 7earl)



7/19

Banin3 &ea"ures


8/19

%GT!SE1redit .uarantee Fund *rust #or &icro ; Small 6nterrises was set u by .o)t$ o# India and SI


9/19

Banin3 &ea"ures


10/19

Ipor"an" Proisions o, TDS 5 T%SDeuc"ion a" source "o 'e ae e, 1.6.2010 /en aoun" ecees)

1+ B- 8innings (or lotter) or crossword p99le Rs.10,000 1+ BB- 8innings (rom horserace Rs.!,000

1+ - :a)ment to contractor ingle pa)ment Rs.%0000. 5ggregate in a 27 Rs. ;!,000

1+ - 2ees (or pro(essional or technical services Rs.%0,000.1+ - Interest on pa)ment o( term deposits Rs.10000


11/19

Banin3 &ea"ures


12/19

Pu'lic Proien" &un*he scheme is oerted by SBI, select ban(s and ost o##ices$ Any indi)idual may, on his own behal# or onbehal# o# a minor !as guardian", subscribe to the #und, any amount not less than $s. 700 an no" ore"/an $s. 608000 in a ,inancial (ear. Subscritions by ?UF are not ermitted$

Non $esien" Inians are not eligible to oen an account$ But i# a resident subsequently becomes :RI

during the currency o# the maturity eriod, he can continue to subscribe till its maturity on a non3reatriation basis$



13/19

Banin3 &ea"ures


14/19

Garnis/ee *rer-ro)ision relating to .arnishee order are under Sec. 90 o# the 1ode o# 1i)il -rocedure, %90@$ *heprocedure is described in $ule 49 o# *rer XXI o# the schedule to the 1ode o# 1i)il -rocedure$:/a" is Garnis/ee *rer; It is an order issued by a court on the request o# a creditor #or attachment offunds of the judgement debtor a)ailable with his ban($ *he creditor is called judgment creditor. Thedebtor is calledjudgement debtor and the ban( !the udgement debtors debtor" on whom this order isser)ed, is called Garnishee.E,,ec"s o, Garnis/ee *rer) *he relationshi between the ban(er and customer is suspendedtemporarily i# the balance in the account is less than amount o# order$ Ban( has no obligation to aycheques issued by the deositor$S"a3es ) .arnishee order is recei)ed in two stages i$e$ Order Nisi and Order Absolute>

-ro)ision relating to .arnishee order are under Sec. 90 o# the 1ode o# 1i)il -rocedure, %90@$ *heprocedure is described in $ule 49 o# *rer XXI o# the schedule to the 1ode o# 1i)il -rocedure$:/a" is Garnis/ee *rer; It is an order issued by a court on the request o# a creditor #or attachment offunds of the judgement debtor a)ailable with his ban($ *he creditor is called judgment creditor. Thedebtor is calledjudgement debtor and the ban( !the udgement debtors debtor" on whom this order isser)ed, is called Garnishee.E,,ec"s o, Garnis/ee *rer) *he relationshi between the ban(er and customer is suspendedtemporarily i# the balance in the account is less than amount o# order$ Ban( has no obligation to ay

cheques issued by the deositor$S"a3es ) .arnishee order is recei)ed in two stages i$e$ Order Nisi and Order Absolute>



15/19

Banin3 &ea"ures


16/19

Accoun"in3 S(s"e ,or $epo 5 $eerse $epoRBI guidelines !o# &ar 25, 200C" catured the character o# reo4re)erse reo transaction as outright saleand outright urchase as er the mar(et con)ention re)ailing then$ *he Reser)e Ban( o# India!Amendment" Act, 200 !Act :o$ 2 o# 200" ro)ides a legal de#inition o# Dreo and Dre)erse reo as aninstrument #or borrowing !lending" #unds by selling !urchasing" securities with an agreement to

reurchase !resell" the securities on a mutually agreed #uture date at an agreed rice which includesinterest #or the #unds borrowed !lent"$ *o bring such transactions onto the balance sheet in their trueeconomic sense and enhance transarency, the accounting guidelines ha)e been re)iewed by RBI on &ar2C, 20%0, which came into e##ect we# %$5$20%0 and are set out below$



17/19

Banin3 &ea"ures

$epor" o, :orin3 Group on %GT!SE?a)ing regard to the imerati)e o# accelerating the #low o# credit to the &icro and Small 6nterrises!&S6s" sector, RBI has constituted a wor(ing grou !under Sh$ 8$E$ Sharma, 6


18/19

D4.8C. D:8..Y 2OR R1P::5The Indian rrenc) will have an D((icial )mbol a(ter 6$ )ears o(independence. s raised ndia>s Rating Out0oo+ from 8egative to 4ta)0eas it expects the contr)Es(iscal sitation to improve (ollowing the measres annonced in the Bdget.

*oted Indian ocial 8orker 7s :0a Ramesh 3hatt has )een chosen for the restigious ?8iwano PeacePrize?this )ear (or contribtion to the pli(tment o( poor women in India.

P*@*8aya+,2ormer hairman and D o( 5xis Bank , is the 3usiness 4tandard 3an+er of the year #B.

7r* Raan 3harti 7itta0, 3ice hairman and ?anaging


19/19

%$ 8ith the release o( the ick stimates o( *ational Income (or $00#-0+, the entral tatisticalDrganision has e((ected a revision in the base )ear o( its *ational 5cconts tatistics &*5' (rom1+++-$000 to FFFF

a $00%-0b $00-0!c $00!-06

d $006-0;


#AST %*#U!N

In"erna"ional &inancial $epor"in3 S"anars

P/ase-I ) Itincludes listed comanies and those with a net worth o# o)er Rs %,000 crore$ *hey will ha)e tocon)ert their oening balance sheets to the IFRS3con)erged accounting standards by Aril %, 20%%$


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