On December 14, 2020, Kotak Mahindra Bank (KMB) informed the exchanges that the Reserve Bank of India (RBI) had approved the appointment of Prakash Apte as non-executive chairman, Uday Kotak as managing director and Chief Executive Officer (CEO) and Dipak Gupta as joint managing director (JMD). All 3 appointments...
EXECUTIVE SUMMARY. It was unfortunate that HDFC Bank decided to provide selective disclosure at a conference call hosted by Jefferies. Only 63 institutional investors participated on the evening of December 9, 2020, where the bank publicly disclosed what went wrong at its recent digital outages. More importantly, in the...
EXECUTIVE SUMMARY. The Reserve Bank of India’s (RBI) decision to temporarily put a halt to all digital launches of HDFC Bank’s financial products and also cease all new issuances of credit cards by the bank brings to the fore the huge reputational risk on account of the bank ignoring...
EXECUTIVE SUMMARY. Despite ICICI Prudential Life Insurance (IPru Life) reporting improvement in long-term persistency ratios, there are worrying examples of brazen mis-selling of life insurance policies by the company through its corporate agent, Angel Financial Advisors and even its parent, ICICI Bank. The cases of two 21-year old customers...
EXECUTIVE SUMMARY. Even though non-bank finance companies (NBFCs) dedicated to providing loans against gold ornaments are highly profitable and enjoy significant net interest margins (NIMs), stakeholders should be concerned about the vulnerability of their branches to robberies. The spate of robberies indicates that thieves are specifically targeting branches because...
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“What is the robbing of a bank compared to the founding of one?” – Bertolt Brecht
An internal working group (IWG) of the Reserve Bank of India (RBI) to review ownership guidelines and corporate structure for Indian private sector banks has recommended that large industrial houses be allowed...
EXECUTIVE SUMMARY. A newly-appointed (on October 9, 2020) deputy governor of the Reserve Bank of India (RBI) has proposed, for discussion, that large systemically-important non-bank finance companies (NBFCs) either convert themselves into banks, or that they contract assets, in order to protect financial stability. This proposal not only has...
EXECUTIVE SUMMARY. HDFC Bank’s 1HFY2021 results is a study in contrasts to its non-bank finance company (NBFC) subsidiary, HDB Financial Services (HDB). While the standalone bank reported a 19% yoy growth in net profits, HDB’s profits collapsed by an alarming 94% yoy (HDB reports only half-yearly performance). The dichotomy...
EXECUTIVE SUMMARY. On the opening date of Vedanta’s delisting offer (October 5, 2020), ICICI Securities (I-Sec) issued a results research note on Vedanta with the following bizarre statement: “Vedanta has highlighted the SEBI approved book value (ex the revaluation reserves) of Rs 89.3/share.” I-Sec, a listed subsidiary of...
