Presentation for

Fi
Finance
P
Projects
j
ANUP NAIR

Mr Abraham Chacko
Mr.

Executive Director Federal Bank

Learning's:
g
From this video I understood various points as he.
Spoke
S
k about
b t hi
his jjourney b
between
t
Middl
Middle E
East,
t Sri
S i Lanka,
L k Singapore
Si
and
d
back to India. He spoke that MBA was not very well known when started
his career. He also spoke how banking was altogether different when he
started his career as an intern in a bank. He shared that how Middle East
was all about family business, in Sri Lanka civil war was going on where
major orientation was for export business and market was SME kind of
business. His last job in Sri Lanka was to sell the Bank in 2001. He also
shared how Singapore market was a global market
market, with refinery
refinery, ports
ports,
shipping industry, Import & Export.
He spoke about how he overcame the political threat and technical barriers
to set up the First ATM in eastern parts of our country. He shared how the
authorities of Shops & Establishment issued notice on Bank for carrying
banking transaction on Sunday for use of ATM. Finally he won the court
case and got a free publicity for his Bank.
Bank

Cont.
Spoke about how Travancore Federal Bank started in pre-independence era
transformed to Federal Bank under the leadership of Mr. K. P. Homis. He
said currently over 1150 Branches & over 825 ATM are fully operational
across the country. He also hailed about the Employees Loyalty and
mixture of the youth and experienced workforce working towards
organization goals. He explained the unity among the workforce as a family
and unique employee culture in the organization.
According to him wholesale banking is set for sharp growth. He expects
revenues to be doubled according to recent trends
trends. He added various report
suggested that return on investment for wholesale business is typically
range bound between 15-30%. He stressed that Corporate Banking
including Lending & Fee Business will account for Lion Share of wholesale
market. Investment Banking & Markets are checked by global slowdown.
He feels positive in achieving the desired targets with such an economic
outlook.

Cont.
He suggested Equity (Primary Origination & Secondary Trading) are
expected to raise along with M&A, debt capital market and private-equity
syndication He said the recent rise in equity market and subsequent pickup
syndication.
in M&A activity are already being felt.
His explanation for what is driving growth is Infrastructure Investment,
Globalisation of Indian Industries, Inspiring a host of inbound M&A deals
and increased fund allocation by global managers, Increasing sophisticated
products and solutions are driving higher margins and growth.
According to him technology is really upto the mark in Wholesale Banking,
but he feels scope of technological growth in retail banking.
He is positive in Government policies affecting Banking Industry.
His message was to learn and choose a career which interests you rather
than going with the wave. He stressed on ethical conduct to be practiced
throughout your career and personal life.

Ms Sagorika Kantharia
Ms.

Chief People officer - Radio City

Learning's:
g
Making Life more Entertaining Mission Statement of HR at Radio City as
explained by Ms. Sagorika Kantharia sums up the entire process at Radio
City.
City
She said how the CEO Ms. Apurva Purohit wanted Radio City a great place
to work, with a positive outlook. She explained how she achieved that by
recruiting the right people, learning on the job, Robust recognition for
employee as Individual & team both. She discussed the positivity in change
in name of HR to Chief People Officer has brought to Radio City.
On asking challenges she faced in Radio City and how she overcame it. She
answered Key talent & Critical People on whom organisation has invested
is leaving the organisation for better prospects & career growth. She was of
opinion that
h was common in the
h media
d industry.
d
Retention
R
off such
h key
k
talent & critical people was a huge challenge.

Cont.
She overcame these by providing awards to employees for 100%
achievement on consistent basis, providing adequate challenging work to
employees Creates value addition by employee which gives pride among
employees.
them. Delegation of work with authority and accountability gives employee
satisfaction.
She brought the annual attrition rate from 15% to 2% at Radio City.
Which according to her is on positive track.
She explained staffing process at Radio City as Stringent Recruitment
process, functional test from Junior Level, Interviews by HOD.
On enquiring the changes in HR in last 10-15 years. She explained that more
emphasis is on people now a days. Great career along with family balance is
order of day. She felt todays generation requires all the goodies in the kitty
without compromising any thing which was not the same in the past.

Cont.
She dedicated her success to her family support, especially to her husband.
She explained the role of family in individuals success.
She highlighted that Collaboration among department pose a great
challenge in organisation. According to her continuous communication
between departments along with team work of HR, HOD & CEO is pre
requisite for collaboration among departments.
She discussed formation of Radio City School of Broadcasting instituted
started by Music Broadcast Pvt Ltd
Ltd. Talent Search/grooming was the basic
idea for formation this school. The institute is 5 years old now with good
success story. Students of this institute are procured by Radio City, as well
as other major players also recruit from this institute.
She is also one of the founder member of Forum for Emotional Intelligence
Learning, a social initiative.

Cont
When asked by Future of Radio Industry she answered that the third phase
of growth is in progress. Over 800 more channels are to be added to the
industry She explained a huge scope of market growth.
industry.
growth She added along
with growth prospects new threats will be emerged, for which Radio City is
geared up for keeping the leadership it has.
She shared her favorite quote The very Business in life is not to get ahead
of others but to get ahead of our self every single day - Swami
Vivekananda.
Her message to young aspiring people is Not to look at the pay package at
the entry level rather look at role you are getting in organisation.

Mr Shyaam Singh
Mr.

CMO - TABcab

Learning's:
g
Mr. Shyaam Singh started his career Selling Eureka Forbes Vacuum cleaners
which according to him was concept selling than product selling because
the product was new for market at that time.
time It was a huge learning process
for him. After working 15 years in Middle East for Freight Forwarding &
Shipping industry he took advertising career. He discussed how he didnt
had a set plan at the initial period of his career. He explains learning from
all, even juniors is golden rule for his success.
On asking about the change in style of advertising he answered that now in
the digital revolution medium are so fragmented, totally changed from
what was it was in past. According to him advertisements has been
reaching to consumers than in the past which is because of the technological
& digital development.
He also revealed how he was headhunted from TABcab after he returned
from Middle East because of a Family Trauma and loss of lives in his family.

Cont
He went on with explaining about TABcab as the youngest in radio fleet
service providing companies, where Meru Cab is the senior most. He also
discussed about his competitors such as OLA , taxi for sure,
sure Mega and
others. He explained the competitive advantage TABcab over other rivals.
As TABcab is working on ownership model and all of its rivals are working
on Franchise owned model. TABcab according to him is having at least 5070% share of the market.
He revealed about Mobile Display Terminal(MDT) Fleet Management
system. Call center, IVR, and Mobile App, all is Integrated with MDT.
Safety is assured for Women & Senior Citizen at TABcab. He explained how
the Safe Assure program, a system which provide message to 5 persons
selected by the customer in every 10 mins by GPS location in the cab. Zero
R f
Refusal
l during
d i 8pm
8
- 8am
8
because
b
off IInternational
t
ti
l fli
flights
ht att night
i ht and
d llocall
flight in morning.

Cont
On asking about Company grown tremendously and key factors of such
sustainability? He answered that this is processed driven industry. He
further stated that the average speed of answering the call on phone is 5 sec
as per International standards now, which is gone very well with customers
who were previously used to wait for 30 to 60 Sec. Individual prizes for
frequent
q
users was another soap
p used by
y TABcab.
He explained various campaigns such as Womens Day Campaign - 1000
free rides to lucky winner a Market driven Campaign,
CSR Campaign such as drinking & driving - Drink & Driving prizes was
offered 1st Prize 6/4 feet real estate i.e. a coffin, Free boarding & lodging
for 1 year - behind bars, Free Accessories - Hand Cuffs. Such campaigns
were huge success for TABcab. Some other CSR were for free service for
senior citizen and handicapped people during Ganesh Utsav.

Cont
He explained the challenges faced by TABcab. 10000 trips a day out of that
120-130 complains, 80% of which are request for receipts. Others are Sathis
(drivers of TABcab) eat tobacco
tobacco, Cab smells bad and dirty,
dirty air condition not
working etc.
He added Retain the Sathis is another p
problem. People
p with Badges
g can be
only employed. Sathis are covered for Insurance, Medical, cash rewards for
every 1 year stay.
According to him Black & Yellow taxis no real threat for TABcab.
TABcab
Message for students keep learning and take calculated risk.

1. Balance of Payment (BOP)

Learning s:
Learning's:
BOP of a country is a systematic accounting record of all Economic
transactions between the residence of the country & residence of foreign
countries within a period of time usually 1 year (though data reported is
quarterly).
BOP measures flow of payment between any Individual country and all
other countries.
Components of BOP
a) Current Account.
b)) Capital
p
Account.
c) Unilateral Payments Account.
d) Official Settlement Account.
Account

Cont
Current Account - Export & Import of Goods & Services, Interest &
Dividend on Investment, Net factor Income, Net Transfer Payments.
Current account surplus increase a country's net foreign asset by the
corresponding amount, and a current account deficit does the reverse.
Deficit on current account = surplus in capital account
Or
Surplus on current account = deficit in capital account.
Capital Account - Initial flow of capital is recorded in the Capital account of
the BOP as purchase of Foreign Asset.
Th
Three
parts
t off C
Capital
it l A
Accountt
i) Private Capital (Long term & Short Term) Long Term Investment &
g Term Loans,, Foreign
g Currency
y Deposits.
p
Portfolio Investment,, Long

Cont
ii) Banking Capital covers movements in external financial assets and
cooperative banks authorised to deal in foreign exchange.
iii) Official Capital - Central Banks holdings in terms of foreign currency
and special drawing rights held by Government are categorised into loans,
amortisation and Misc. Receipts & Payments.
Unilateral Payments Account - One way transfer e.g. payment made by
NRI, Payment for curing of illness in foreign currency in foreign country,
etc.
etc
Official Settlement Account (OSA) - Central Bank of Country use funds in
various ways to control appreciation/depreciation of Rupee through OSA.

2. Money Market

Learnings:
g
Financial Market consists of Money market, Capital Market, For-ex Market,
& Debt market.
Money Market is short term transfer of funds from suppliers to users which
has active secondary market to reallocate. Basic parameters - Large
Denominations, Low Default Risk & generally issued to high quality
borrowers with little risk of default. Original Maturity of One Year or Less
with risk of adverse price movements because of interest rate fluctuation is
lesser.
Money Market Securities consist of T-Bill, Repo, Commercial Papers,
Certificate of Deposits(CD), Bank Acceptances and Call Money Market.
T-Bill
T
Bill is
i Treasury
T
Bill are Short
Sh
term Money
M
market
k Instruments
I
issued
i
d by
b
Central Government in the form of "Discount" Instruments. Currently RBI
Issues T-Bill for tenors of 91Days, 182Days and 364Days.

Cont
It is Issued to cover Budgetary deficit, refinance maturing Government
Debts and also conduct monetary policies.
T-Bills are highly liquid, can be bought and sold in an active secondary
market via government securities dealers who purchase T-Bill from the
Government, and resell them to investors.
T- Bills are in nature of Deep Discount Instruments. They are issued at
Discounted face value and redeemed at par on Maturity, the difference of
issue value and face value constitutes the Interest on T
T-Bill.
Bill.
Primary dealers create a market for T-Bills by purchasing and selling
securities for their own account and by trading for their customers
i l di depository
including
d
it
institutions,
i tit ti
iinsurance companies,
i pension
i ffunds
d etc.
t
T-bill market is decentralised, with most trading transacted over the
p
and /
/or online trading.
g
telephone

Cont
REPO - A Repo is an agreement involving the sale of securities by one party
to another with a promise to repurchase the securities at a predetermined
date & price in the future.
future
Repos have a short term maturity e.g. from 1 day to 14 days, but now a days
long term repos are also popular with period of 1 - 3 Months.
Repo is a collateralised Loan with the collateral backing taking the form of
securities. In most repos the title of Securities is transferred to the Repo
Buyer.
Repo are arranged either directly between two parties or with the help of
brokers and dealers.
Repos are used by central Bank to help it conduct open market operations as
a part of its overall monetary policy strategy.

Cont
The Repo market is governed by the RBI and only eligible parties can
transact in eligible securities. Eligible Parties include banks, primary
dealers Mutual Funds,
dealers,
Funds Insurance Companies
Companies, Non-Banking
Non Banking Finance
companies and Housing Finance Companies.
Repo Transactions are currently carried out only in Mumbai.
Commercial Paper - It is unsecured short term promissory note issued by a
company to raise short-term cash, often to finance working capital
requirements.
The primary feature of CP is companies with strong credit rating can
generally borrow money at lower interest rate by issuing commercial paper
th by
than
b b
borrowing
i ffrom b
banks.
k
CP can be sold directly by the issuers to a buyer such as mutual funds or
can be sold indirectly
y by
y dealers in the commercial p
paper
p market.

Cont
CP paper is generally held by the investor till maturity, thus there is no
active secondary market for CP.
CP is sold to Investors either directly using the Issuer's own sales force or
indirectly through brokers and dealers such as major bank subsidiaries that
specialize in Investment banking activities and investment banks
underwriting issues.
Essential for CP Issue - Company should have Tangible Net worth of INR 4
Crores Should have bank loan sanctioned to it which falls under Standard
Crores,
Assets with bank, Minimum Credit Rating by an approved agency, Issued in
multiples of INR 5 Lakhs, Issued at discount to face value redeemable at par
at maturity.
Secondary transaction of Commercial Papers do not attract any stamp duty.
Hence there are no explicit transaction costs when direct parties are
Involved.

Cont
Negotiable Certificate of Deposits(CD) is a bank issued time deposit that
specifies an interest rate and maturity date and is negotiable in secondary
market.
market
CD is a bearer Instrument. It can be traded number of times in secondary
market, therefore original buyer is not necessarily the owner at maturity.
CD are often purchased by money market MF which pool funds of
Individual investors and allow this group to purchase negotiable CD.
CD maturity ranges from 7days to 1Year with most having a maturity of one
to Four Months.
It is
i Issued
I
d to
t an Investor
I
t for
f funds
f d deposited
d
it d into
i t a scheduled
h d l d Commercial
C
i l
Bank and Development Financial Institution like IDBI, IFCI, Exim Bank etc.

Cont
CD are unsecured Instruments issued at discount to face value and the
discount is market determined.
Bank CD are always discounted bills, whereas CDs issued by Financial
Institutions are Coupon bearing. Banks are not allowed to grant loans
against CDs or buy back their own CDs.
Bank Acceptances is a timely draft payable to a seller of goods, with
payment guaranteed by a bank. Time drafts issued by a bank are orders for
the bank to pay a specified amount of money to the bearer of time draft on a
given date.
Many bankers acceptance arise from International trade transaction and the
underlying
d l i letter
l
off credit
di that
h are used
d to finance
fi
trade
d iin goods
d that
h have
h
yet to be shipped from a foreign exporter to a domestic seller.
p
are p
payable
y
to the bearer at maturity,
y, they
y can be
Bankers Acceptance
traded in secondary markets.

Cont
Denomination of bankers acceptance is determined by the transaction
between the domestic Importer and foreign exporter.
Double protection underlying bankers acceptances that reduces the default
risk. Like T-Bills and commercial paper, bankers acceptances are sold on a
discounted basis.
Call Money market is inter bank Money market which includes Cooperative
Banks.
Specified Financial Institutes, MFs are only allowed as lenders.
The interest rates are market determined. Both borrowers and lenders need
to have
h
current accounts with
i h RBI.
RBI

Cont
Call money market serves as an outlet for deploying funds on short term
basis to the lenders having steady inflow of funds.
The supply of demand for funds in the market arises on account of :
a) Compliance with CRR with RBI.
b) As a funding source to build up assets.
c) Temporary surpluses available with lenders.
d) Foreign Exchange flows.
e)) Seasonal
S
l factors
f t
such
h as harvests,
h
t advance
d
ttax payments
t etc.
t

3. Basics of Micro Finance

Learnings:
g
Micro Finance is a revolution in finance today - Supply of small amount of
Loans and other basic financial services to the poor.
It is different from services provided by formal banks. Formal bank require
some security for advancing money but in micro finance the only security
taken is to link the honor of the people involved in one group. The loan
mechanism is based on simplified process usually for 1 year and the
repayment is in general weekly and interest rate is slightly higher by normal
bank which ranges from 20% to 70% depending on country where the loan
is granted.
Concept of Group Lending - If one borrower fails to repay, then the entire
group is accountable for the same.
Benefits are poor households can meet basic needs and protect themselves
against risk, poor ability to cope with economic shocks, Build financially self
p
of women,, Better Education,, Higher
g
Income,,
sufficient,, Empowerment
Employment Generation, Cohesiveness of the community.

Cont
Myths - Poor are too costly to reach and motivate, Institution for the poor
cannot be financially self sufficient, such Institution will only add a debt
burden to the poor.
poor
Risk in Micro Finance are Entrepreneur Risk (Business Issues, Health
Issues, and other issues). Field Partner Risk (Fraud, Poor Operations).
Country Risk (Economic, Political, Natural Disaster).
R = (AE + CF + II + K) / (1-LL)
where AE = Administrative Expenses,
Expenses CF = Cost of Funds
Funds,
II = Investment Income, K = Desired Capitalisation rate, LL = Loan Losses.
Capitalisation (K) represents net Real profit the MFI would like to achieve
as % off L
Loan portfolio
f li usually
ll 55-10%
10% off average lloan portfolio
f li
Investment Income expected to be generated by financial assets, excluding
the loan portfolio.

Cont
The returns are higher for Micro Financing entrepreneurs compared with
normal financial Institutions since the Interest charged is higher.
Fees & Service Charges are calculated on Initial Loan Amount and Collected
up front.
Challenges - Internal Control Systems, Supervision, Staffing Constraints,
MIS, Geographic Dispersion, Donor Pressure.
Benefit to Investors - Low Default Rates,
Rates High Standardization,
Standardization High
Diversification, Low pre payment Risk.
Countries with Success Stories - Bangladesh, Cambodia, Colombia,
E
Ecuador,
d Ni
Nicaragua, P
Peru Russia.
R i
India MFI - SKS Microfinance, Spandana Spoorty Pvt Ltd, Arman Financial
y Samruddhi Financial Services,, Grameen Koota,, Village
g
Services,, Bharatiya
Financial Services Pvt Ltd, Equitas Microfinance (I) Pvt Ltd.

4. Savings v/s Investments

Learnings:
g
Old Rule Income - Expenses = Saving
New Rule Income - Saving = Expenses
or
Income - Future Expenses = Current Expenses.
Pre pone your Savings & Post pone your expenses. Sure way of Increasing
your savings.
Indians are excellent savers, but there is a problem, unfortunately not so
good Investors.
Investors
Simply Saving money, keeping as cash at home or saving account may not
mean that money will work for you in future. Money loses its value called
Purchasing
h
power d
due to Inflation.
fl
Money saved in past has lost its purchasing power due to Inflation. Most
are not concerned due to ignorance/lack of financial literacy.

Cont
Saving to be Invested so that it atleast outgrow Inflation.
If by Investing:
Return = Inflation No Gain
Return > Inflation Gain
Return < Inflation Loss.
Saving is an act of putting aside money after expenses & Liabilities. We
must focus on saving as this is in our control. Unfortunately Investment is
not.
TIPS on savings - Prepare your monthly Budget, Refrain from Impulsive
buying, Work on needs rather than wants, Economize yourself, avoid
excessive borrowing because you are preponing expenses and postponing
savings, start saving early.
l
Savings alone cannot achieve your Financial goals like dream home, child
education, retirement etc.

Cont
Savings will work for you by Investing it in an asset class which at least
outgrow inflation.
Investing saved money, gains strength and become powerful.
Investing is an act of your savings to be put into productive use with an
expectation of earning return more than inflation to preserve purchasing
power of money.
Advantages - Savings grow by earning Interest, Dividend, Capital Gain etc.
While Investing help in countering Inflation and provides sense of financial
security.
Approach
A
h to
t Investing
I
ti
i) Ascertain risk involved while investing in particular asset class.
/ appetite
pp
should match the asset class.
ii)) Risk tolerance/

Cont
iii) Investment should be as per your goal and objective and not as per
market environment.
iv) Time period - Longer the period of your goal higher the risk you can
take and vise-versa.
v)) Age- Younger should
h ld prefer
f risky
k asset for
f higher
h h gains.
vi) Do Adequate research - take professional advise & do not get carried
away by crowd.
vii) Recognise tax implication while investing and start early for the wonder
of compounding to take effect.

5. Assetology
l

Learnings:
g
Assetology is a mixture of Science and Art. Science because of the analytical
part of it and art because picking right stock at the right time is an art.
Financial Asset & Physical Asset Financial Asset are most Intangible assets
such as Equity, Bonds etc. whereas Physical Assets are tangible such as
Reality Asset, Gold etc.
Evaluating Investment and Financial Planning will achieve desired goals of
the Investors
Picking right Asset Allocation model is important.
Strategic Asset Allocation is normally for Longer period of time.
Tactical Asset Allocation means allocation depending on market condition,
Environment in which business is done & Government Policies you take a
y/ sell.
decision to Invest / not to Invest or to buy/to

Cont
Assetology at Macro Level explains to Invest or not to Invest.
Keep abreast of recent development is the prerequisite of good Investment.
Investment
Interaction between various assets amounts the cause and effect for the
investor to identify while investing.
If one is not able to distinguish between cause & the effect, it will be a role of
dice i.e. gamble for the investor while investing.
The various interaction of Assets at Macro Level are broadly Interest Rate,
Inflation, Current A/c, Exchange Rate, Capital flow, GDP, Asset Price, Oil,
Government Finances and Money Market etc.
Once the cause and effect due to interaction of various assets are understood
it will help the investor for asset allocation.

1. What is the difference between Recurring

g and Fixed Deposits
p
When it comes to savings and investing, most of the risk averse people love
to invest in bank deposits. And many gets confused between Recurring and
Fixed deposits offered by banks.
banks
Recurring Deposits (RD) and Fixed Deposits (FD) have same features in
terms of safety, maturity and interest rate. Even the tax applicable is same
on the amount invested.
However, the difference lies in the nature of tax deduction. In a fixed
deposit, banks deduct TDS if the interest income in a year exceeds Rs. 10000
but there is no TDS deduction in recurring deposit.
Fixed deposits earn more when compared to Recurring deposits.
Fixed deposits are better for someone who has lump sum amount and may
not need for a period of time.

Cont
Interest rate depends upon the maturity period, longer the period greater
the interest rate.
In case, you do not have lump sum amount and looking for monthly
savings then RD is best option out of the two.
Interest rate depends upon the maturity period, longer the period greater
the interest rate.
There is no TDS applicable on RD.

2. Banking system vulnerable to Financial contagion : Reserve Bank Of

India.
India's close ties between lenders would leave the banking system
vulnerable to contagion in case of trouble at a single institution
institution, the central
bank warned in a report.
The RBI also used money markets as one of its variables for stress tests
given banks
b k ffrequently
l llend
d to each
h other
h in short-term
h
maturities.
India's non-banking financial firms ( NBFC) also pose a risk to the banking
system due to their close ties with banks, the RBI warned in the report.
This so-called shadow banking system is worth $190 billion in India,
ranking it third largest among BRICS countries and 15th in the world, as per
RBI BRICS is
RBI.
i a frequently
f
tl used
d acronym that
th t refers
f
to
t Brazil,
B il Russia,
R i India,
I di
China and South Africa

Cont
Turning to other risks in India's financial system, the RBI highlighted the
need for "closer examination" of the practice of promoters who pledge a
substantial portion of company shares to get loans.
loans
The RBI noted it expected the level of bad levels to steadily come down,
estimating
g the ratio of g
gross non-performing
p
g loans to total assets would
decline to 4 per cent by March 2016 from 4.5 per cent at the end of
September 2014 under its baseline scenario.
Turning to economic indicators
indicators, the RBI said it expects consumer price
inflation to hover around 6 per cent in the next 12 months if global crude
prices remained steady and monsoons are normal.
The central bank also expects India's economy to grow 5.5 per cent in the
fiscal year ending March and then slowly pick up momentum in the
following year.

3. RBI Advances deadline for p

providing
g services to unbanked villages
g
The Reserve Bank of India has advanced the deadline for banks to complete
the process of providing banking services in unbanked villages (with
population less than 2,000)
2 000) to August 14,
14 2015,
2015 instead of March 2016.
2016
This move comes in view of the ongoing implementation of the Pradhan
Mantri Jan Dhan Yojana (PMJDY), which is a national mission for financial
inclusion.
The scheme seeks to ensure access to financial services such as
banking/savings and deposit accounts,
accounts remittance,
remittance credit,
credit insurance,
insurance
pension in an affordable manner to the weaker sections and low-income
groups.
IIn 2012,
2012 the
h State-Level
S
L
lB
Bankers
k Committees
C
i
(SLBCs)
(SLBC ) were mandated
d d to
prepare a roadmap covering all unbanked villages of population less than
2,000 and notionally allot these villages to banks for providing banking
services,, in a time-bound manner.

Cont
The notional allotment was only intended to ensure that all villages have at
least one banking outlet for providing banking services and does not deny
or bar any other bank from operating in these areas based on the available
business potential.
While preparing the roadmap for this scheme through a combination of
business correspondent (BCs) and branches, the RBI said it should be
ensured that there is a brick and mortar branch to provide support to a
cluster of BCs units about 8-10 at a reasonable distance of 3-4
kilometers.
kilometers
Since PMJDY was launched on August 28, banks collectively have opened
10.36 crore basic savings bank deposit accounts and issued 8.38 crore RuPay
d bi cards
debit
d up to December
D
b 30.
30
About 73 per cent of the total accounts opened have zero balance.
g accounts have balances aggregating
gg g
g 8,044
,
crore.
The remaining

4. Loans will be cheaper,

p but banking
g services to be expensive
p
in 2015.
The banking space was a mixed bag for retail customers in 2014. Interest
rates remained decidedly high during the year, delighting depositors but
dismaying borrowers.
borrowers
The RBI introduced several customer-friendly measures during 2014 and
even took up cudgels on behalf of the aam admi by laying down a charter of
rights. But all these got balanced by a new rule that allows banks to charge
for ATM usage beyond five times a month.
Another major change was the RBI
RBI'ss nod to allow children above 10 to
operate their bank accounts independently. Kids are permitted to use
facilities like ATM and cheque books.
Though
Th
h mostt analysts
l t expectt th
the RBI tto cutt rates
t in
i 2015
2015, it is
i nott clear
l
if
this will happen in the next couple of months. Till that happens, make best
use of the high deposit rates offered by banks. If you do not have a large
p
, use recurring
g deposits
p
to lock in to the high
g
sum to invest in a fixed deposit,
rates

Cont
If you plan to take a home loan in 2015, opt for a floating rate loan. Given
the imminent cut in rates, a fixed rate home loan will not be a good idea.
Customers may submit only one proof of address when opening a bank
account or during periodic updating for KYC.
Banks
k not to charge
h
fforeclosure
l
charges
h
on fl
floating rate lloans.
Instead of penal charges for not maintaining minimum balance, banks
should limit services available on such accounts. Banks not to levy penal
charges for non-maintenance of minimum balance in any inoperative
account.
SMS Charges
Ch
- Banks
B k told
t ld tto charge
h
customers
t
only
l on th
the basis
b i off actual
t l
usage

5. FII Inflows hit record $26 Billion in Debt markets IN 2014

Overseas investors pumped in a record Rs. 1.6 lakh crore ($26 billion) into
the Indian debt market in 2014 mainly on account of high interest rate and
governmentss reform agenda.
government
agenda
The inflow by Foreign Institutional Investors in 2014 has significantly
contributed to taking the cumulative net investments into the Indian debt
markets since being allowed over two decades ago, in November 1992, to
Rs. 2.6 lakh crore.
This huge investment inflow, which belies commonly used nomenclature of
hot money because such funds can be withdrawn anytime, has come at a
time when foreign companies have been mostly reluctant on their FDIs
(Foreign Direct Investments) that carry a common perception of being
l
longer-term
t
iin nature.
t
According to market experts, high interest rates coupled with strong-willed
RBI ((Reserve Bank of India)) attracted FIIs to invest in Indian debt markets.

Cont
Interestingly, most of the inflows this year into Indian debt market has gone
into government securities.
Market experts said that overseas investors remained bullish on the Indian
debt markets throughout 2014, barring the month of April. The sentiments
had been bullish even during the first half of the year, mainly on hopes that
a strong reform-oriented government will come to power at the Centre.
After the change in government at the Centre in May, there has been a
significant change in sentiment and outlook towards India. Most foreign
investors are finding India to be a far better choice that can generate returns
in both short and long term, Ladderup Wealth Managements Managing
Director Raghvendra Nath said.
Amongst various emerging market economies, India is being viewed as the
strongest candidate for portfolio investments, he added.

6. Indias FOREX Reserves up $ 3.16 BN TO $ 319.99 BN

Indias foreign exchange (forex) reserves rose $ 3.16 billion in the week
ended December 19 to $319.99 billion.
In the full year, the countrys forex reserves have risen by $24.49 billion,
thereby making the countrys external position relatively more stable now
as compared to the end of the last year.
Foreign currency assets (FCAs), which form a bulk of the total reserves, rose
$ 3.31 billion in the reporting week. For the full year, FCAs were up $ 27.20
billion.
During the week gold reserves remained unchanged at $ 18.98 billion.
Special
S
i l Drawing
D
i Rights
Ri ht (SDRs)
(SDR ) and
d the
th countrys
t reserve position
iti in
i the
th
International Monetary Fund (IMF) fell by $ 29.2 million and
$ 117.6 million, respectively during the latest reporting week of the year.

Cont
For the full year, gold reserves have come down by $ 1.61 billion, while
SDRs and the countrys reserve position in the IMF have dropped by $ 232.5
million and $ 856.9
856 9 million,
million respectively.
respectively

7. Investment Banks hope

p to ride on higher
g
in 2015.
Investment banks are hoping to ride on higher deal volumes in 2015, driven
by an expected consolidation among power, telecom companies and
infrastructure developers and an uptick in outbound mergers and
acquisitions by Indian companies in healthcare, information technology and
capital goods.
Bankers hope the Narendra Modi government to push reforms to revive
economic slump and help drive M&A volumes, after a limited uptick in
2014 as it takes longer time to sew up deals.
Investment bankers from at least eight banks Economic Times interviewed
predicted an increase in deal volumes in 2015.
Most off the
M
h volume
l
iin 2014 was d
driven
i
by
b llocall consolidation
lid i rather
h than
h
inbound or outbound deals. The notable deals included Sun Pharmaceutical
Industries purchasing rival Ranbaxy Laboratories and local ecommerce
giant Flipkart's
g
p
acquisition
q
of Myntra.
y
Cross-border
activity was lower than previous years.

Cont
Domestic banks scored over global peers in terms of the number of India
deals closed. Avendus Capital, I-Sec and Kotak Mahindra Capital have done
better than previous years.
years
India's market saw 980 M&A deals worth $ 47.8 billion, 134 equity capital
market deals worth $ 11.3 billion and 320 debt capital market deals totaling
$ 41.5 billion in 2014.
Within M&A, bankers expect sectors such as technology, telecom and
media, apart from industrials, healthcare and financial services to be the
growth engines for 2015. "We expect M&A volumes to pick up in 2015
driven by Indian corporates as well as overseas acquirers," said Kapoor of
Citigroup. Citi was part of some of top deals such as Sun Pharma - Ranbaxy
and
d Adanis
Ad i acquisition
i iti off Dhamra
Dh
port.
t

8. How to make the most of Investment opportunities in 2015.

In many ways, 2014 was a landmark year. It marked a turning point for the
global and domestic markets after several years of gloom and unnerving
uncertainty.
uncertainty
Even as the world economy stabilised, on the domestic front, the new
government at the Centre ushered a refreshing spell of revival and hope. As
macro and
d micro
i
indicators
i di
swung towards
d optimism,
i i
we also
l detected
d
da
need for caution.
Still,, there's much to look forward to in 2015 in every
y aspect
p
of p
personal
finance, ranging from stocks, mutual funds and banking to gold, real estate
and insurance.
Multiple
M
lti l positives
iti
already
l d priced
i d in
i economy. It can be
b seen by
b the
th market
k t
sentiments and higher valuation by experts about the market

Cont
Tips for Investments Moderate your expectations from markets in 2015
2015. Keep a low exposure in
gold.
Prices are expected to remain depressed in 2015. Large-cap funds to be
safer bets in 2015
Basic exemption limit in taxation may be hiked in coming budget
Online insurance plans will become bigger and to be watched for in 2015.
Invest in real estate now, residential rates may rise in latter part of 2015.
Loans will be cheaper, but banking services to be expensive in 2015

9. Online money
y transfers g
growing
g rapidly,
p y Digital
g
Money
y on the cards.
Online money transfer is emerging as a hot favourite when it comes to
payments, data from the Institute for Development and Research in Banking
(IDRBT) an apex arm of Reserve Bank of India,
(IDRBT),
India shows.
shows
There has been a tremendous increase in online transfers using National
Electronic Fund Transfers (NEFT) and Real Time Gross Settlement (RTGS)
systems, AS Ramasastri, Director
IDRBT, told Business Line.
The Hyderabad
Hyderabad-based
based institute plays a key role in electronic payments
through these two systems and has a Structured Financial Messaging
System (SFMS) hub.
The latest
Th
l
data
d
indicates
d
that
h transaction volumes
l
as well
ll as value
l off
transactions had almost doubled in just one year.
This growth is expected to increase in the current financial year.

Cont
Both the hub and settlement systems have sufficient headroom for business
growth for next three years. Its systems have also been upgraded to speed
up transactions.
transactions
The turnaround time for completing a transaction is as low as three seconds
for RTGS and 17 minutes for NEFT.
Digital money - IDRBT is now working on a new concept of digital money.
This would do away with physical transfer of cash from banks and financial
institutions.
institutions
Three exclusive research labs have also been set up for mobile payments,
analytics and information assurances.
Analytics in banking has been gaining importance. If specific patterns are
identified, they will help in redefining customer relationship, fraudg
detection and risk-mitigation.

10. Mutual Funds p

pump
p Rs. 23,500
,
Crores into stocks in 2014 as market
rallies.
Mutual funds pumped in more than Rs. 23,500 crore in domestic equities in
2014 mainly on account of rally in stock markets.
markets
This was in sharp contrast to net withdrawals of over Rs. 21,000 crore in
2013.
Fund houses are upbeat about inflows for the next year as equity markets
are expected to deliver further.
Industry experts attributed the inflows in equities to improvement in
market sentiments and increased participation from retail investors,
primarily due to change in the government at the Centre.
The money in equities started coming in from the second half of May, after
the announcement of General Election's verdict, and the momentum has
continued till date.

Cont
Prior to May, mutual funds had been net sellers in the stock market since
September last year. MFs were net buyers of shares worth Rs 1,607 crore in
August 2013.
2013
Optimism of investors is one of the main reasons why the industry has seen
inflow this year. The new government coming into power with majority on
their own gave sense of stability and hope that this will bring economy
back on track.
Mutual funds collect money from investors and later invest the same into
various market segments including stocks, IPOs (primary market) and
bonds.
The net inflow
Th
fl
in the
h equity market
k is in lline with
h the
h b
benchmark
h
k BSE index
d
Sensex gaining more than 29 per cent in 2014.

Thank you..
you