Retail-focused
new private sector banks, the darlings of the capital market, are facing the
ire of the banking regulator. Nearly two months after the Reserve Bank of India
(RBI) compelled HDFC Bank to classify a large account as non-performing, thus
qualifying the blue-blooded bank for ‘divergence’ (from RBI findings), comes
news that the regulator...
True, the field is crowded, and fresh insights are hard to come by. Still, contrary to Douglas Kim’s argument, it’s not mid-caps, but large-caps, that offer profitable subject matter for research. The advantage for the truly independent researcher is that, while the usual corporate doors are quickly shut, there...
It is extremely unfortunate that the regulatory agencies have till date not penalised any senior individual in the banks or the partners in the audit firms responsible for the huge divergence in NPAs in FY2016. The lack of punishment so far raises concerns of ‘regulatory capture’ by the private sector banks.
Hemindra Hazari
Rising net deferred
tax assets (DTA) in a scenario of stagnant and depressed net profits is not a
healthy sign in some of the banks, as current years’ net profits get enhanced
while sometime in the future the net DTA will get reversed impacting future net
earnings. This trend is visible in...
Credibility issues have plagued Yes Bank’s asset quality disclosures in the earlier (year ending March 31, 2016) annual report, added to these concerns is a top heavy organisational structure with significant expansions and contractions in the “top management” category in the last 2 years without any explanation in the...
On May 12, 2017, Yes Bank, released its annual report for the year ended March 31, 2017 where the Reserve Bank of India’s (RBI) mandatory disclosure showed that for the year ended March 31, 2016, the bank’s gross non-performing assets (NPAs) was higher by 5.6x to Rs49.3bn instead of...
IndusInd Bank’s quarter ended March 31, 2017 (4QFY2017) was impacted by a “one-off” exposure to a company whose cement operations is in the process of being acquired by a top-rated company. While sell-side analysts regard it as a blip in the secular positive outlook on the bank, they are...
Even in a rowdy game of soccer, two yellow cards result in dismissal from the field of play. Indian banking, though, adheres to lower standards. For two consecutive years, Axis Bank has been exposed by the regulator for mis-reporting in its financial statements; yet the bank’s board of directors...
The Gurgaon Sessions Court on March 10, 2017 delivered its verdict in the Maruti Suzuki rioting and arson case of July 22, 2012 at the company’s Manesar (Haryana state) factory which claimed the life of its human resources general manager, Awanish Kumar Dev and caused widespread destruction at the facility....
