India s Economic Recovery To Reduce Bank Stress, Says S&P Report
Moneylife Digital Team
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An improvement in India s macroeconomic conditions is likely to alleviate stress for the country s banking sector, says a report, titled Banking Industry Country Risk Assessment: India , from S&P Global Ratings.
It says, The Indian government s strong efforts to shield banks from the COVID-19 pandemic have been largely successful, in our view. However, a hit from the pandemic is inevitable. While the Indian economy is on a mend, the permanent gross domestic product (GDP) loss stemming from the brunt of the coronavirus is huge at 10%.
S&P estimates the Indian banking system s weak loans are at 12% of gross loans. It says, credit costs should improve to 2.2% of total loans in the fiscal year ended 31 March 2022, from its estimate of 2.7% for fiscal 2021.
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When a person dies intestate (without leaving a will), the transfer of certain assets to the heirs of the deceased requires a legal heir certificate, and in a few States a probate, in order to establish their claim.
Mumbai-based lawyer Siddhartha Shah says “A number of other documents such as legal heir certificate may be procured, as an alternative to a succession certificate, for the purpose of establishing an inheritance or aiding in the transfer of assets from the deceased. It is comparatively easier to obtain it”.
Mr Shah explained “In some cases, a legal heir certificate may be used in the place of a succession certificate merely because family is able to obtain a legal heir certificate conveniently and quickly. Usually, families first apply for a legal heir certificate and in the event a legal heir certificate is not accepted by the relevant authority for some reason, then a succession certificate is applied for”.
We had mentioned in Tuesday’s closing report that Nifty, Sensex may fall further if overseas markets remain weak. On Wednesday, the indices rallied and closed with major gains. On the NSE, there were 1,227 advances, 600 declines and 411 unchanged.
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Stock trading at the National Stock Exchange (NSE) came to a halt on Wednesday, one day before the expiry of February derivatives, following a technical error with its telecom links and issue with live ticks for NSE indices like Nifty 50 and Nifty Bank. After the rates stopped updating on NSE at 10.08am, NSE closed futures and options (F&O) trading at 11:40am and cash market at 11:43am. Later, NSE cancelled all open orders in the equity, F&O and currency (CDS) segments.
Interestingly, at the same time that NSE halted trading, there were issues with NSE Clearing Ltd (NCL), which clears the trades on NSE. Trades of Bombay Stock Exchange (BSE) are cleared through Indian Clearing Corporation Ltd. Troubles at NCL has prevented the market from smoothly shifting over to BSE’s trading platform, as part of what is called interoperability of clearing corporations (CC).
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India s non-banking finance companies (NBFCs) need to plan for an effective IBOR (inter-bank offered rate) transition, as majority of LIBOR (London inter-bank offered rate) rates are likely to be phased out by the end of 2021, EY India report said.
In financial parlance, LIBOR refers to one of the most common series of benchmark rates referenced by contracts measured in trillions of dollars across global currencies.
This is an opportune time for NBFCs to develop LIBOR transition plans and proactively communicate with regulators, investors, lenders, customers and other counterparties, Sandip Khetan, partner and national leader, financial accounting advisory services (FAAS), EY India was quoted as saying in a statement.