10 days vigilance leave for SBI employees

Some of the employees of State Bank of India might find it as very refreshing news but for some it is going to be as bad as a bad dream. The State Bank of India has instructed all the employees of the bank to go for a 10 day compulsive leave during a year that would also be known as preventive vigilance leave, a very common trend followed by MNCs.

During a study it was found that a lot of the employees that have established a very good reputation for their regularity and sincerity for work were found to be indulged in some kind of fraud. Such employees tend to use their good reputation and good relationship with the customers to commit a well planned fraud.

The employees that do not utilize the leaves earned by them are probable suspects as they want to keep their wrongdoings a secret and in due course of time such employees converts the fraud money into real money by corrupting the record.

The State Bank of India took this step in order to strengthen their internal processes and to keep check on scams.Some of the State Bank employees might find it as very refreshing news but for some it is going to be as bad as a bad dream. The State Bank of India has instructed all the employees of the bank to go for a 10 day compulsive leave during a year that would also be known as preventive vigilance leave, a very common trend followed by MNC Banks.

During a study it was found that a lot of the employees that have established a very good reputation for their regularity and sincerity for work were found to be indulged in some kind of fraud. Such employees tend to use their good reputation and good relationship with the customers to commit a well planned fraud.

The employees that do not utilize the leaves earned by them are probable suspects as they want to keep their wrongdoings a secret and in due course of time such employees converts the fraud money into real money by corrupting the record.

The State Bank of India took this step in order to strengthen their internal processes and to keep check on scams.

“Bank on Bike”: another creative move from SBI

State Bank of India has come up with another creative move to make the Financial Inclusion Plan a success . The bank has launched a new project known as “ Bank on Bike” at Cheriyal in Medak on pilot basis for a period of one month.

Through this service the bank plans to benefit the customers in the unbanked areas of the district. If the project proves to be a success then the bank has planned to expand this service further to 400 villages by March this year.

For the purpose the bank has appointed Business Correspondents, these correspondents would carry laptops and a data card to access the SBI site. It is based on biometric system to avoid any kind of fraud and due to this, even illiterate people will be able to access their bank account safely.

According to the official this project aims at providing the banking facilities to the people that are in unbanked areas with less cost and within short time span.

SBI working on next overseas venture

In a bid to expand globally State Bank of India has announced that it is in final stage of dealings to open a bank office in Doha. State bank of India is the largest bank in India and is ranked 8^th in Asia.

A senior official informed that "The talks and procedures for setting up of a wholesale banking unit in Doha are in the final stages,”

Opening a branch in Doha is very critical step to tap business opportunities in the gulf region. The bank further plans to expand the network in the country as well as in the Gulf region.

The bank officials believes strongly that the country has a lot of potential and the bank expects that the Doha branch will start registering profits by the end of the first year of operations.

The bank is presently ranked 62^nd globally. The overseas profit earned by the bank is around 16 percent of the total business by the bank. The bank aims to increase the overseas business share in the total profit to 25 percent.

The services would include collecting large commercial deposits and making big loans to high net worth corporates and individuals, offering bank guarantees, counter-guarantees, Lines of Credit among others. The bank also plans to offer investment and retail banking services to tap into the presence of a large number of Indian and Asian business entities and expatriates in Qatar.

The bank presently have 152 branches in 32 countries and plans to increase the total number of overseas offices of the banks to 1,000 in next couple of years.

State bank of India to open new branches in China

The largest public sector bank of in India, State bank of India is planning to open a representative office in Guangzhou (China). The bank already has a branch in Shanghai and representative office in Tianjin .The bank has however planned to upgrade the representative office to a branch.

It can be noted that already a few Indian banks have their branches in China. Allahabad bank, a state owned Kolkata based bank has also announced extending it’s branch network in China recently.

“A foreign bank can approach the China Banking Regulatory Commission for upgrading a rep office to a branch upon completion of two years of operations,” said a bank official.

A foreign bank in China can take upto 5 years to turn into profit , a senior public sector official pointed that the bank has to be prepared for a long haul there.

Bhatt says, SBI has no immediate plans to revise prevailing interest rates

India's largest public sector bank, State Bank of India (SBI) has no immediate plans to revise its fixed deposit and lending rates. SBI Chairman, OP Bhatt told reporters, "I don't see any possibility of immediate change in our any rate." He added, "This possibility may occur after three-six months depending upon any change in the economic condition."

However, after the Reserve Bank of India raised repo and reverse repo rates fifth time the banks have said the hike in lending and deposit rates will be done in October.

Bhatt, without taking the name of SBI predicts the base rate may increase by 25 points which will result in increase in the interest rate of loans which are directly associated with the base rate, but all will depend on the economic condition.

As per new RBI guidelines, the banks have set their base rates and they cannot lend below that rate. Regarding raising Rs20,000 crore from the market through rights issue, he said, "we are talking to the government on the issue and I hope that our right issue will get the government's nod in the current financial year only."

In reply of prospects of SBI’s business in 2010-11 in view of the erratic monsoon season, he said, "though monsoon was not good in states like Orissa, Jharkhand and West Bengal, I hope that still we will register a growth of 20 per cent in the current financial year."

SBI to launch special service for visually handicapped

State Bank of India (SBI), the country's largest lender is planning to start a new service for the visually handicapped persons, as part of its responsibility to better service society

The new service named Self Service Banking Centre (SSBC) will become operational shortly. The Centre of this service has been set up at the Delhi Head office of SBI at Parliament Street. The Centre has handicapped friendly design with a ramp for wheelchairs.

For visually handicapped, the ATM has a dedicated Braille keypad facility.

Basically, SSBC is a staff less banking group offering multiple banking facilities, namely ATMs, Internet banking and mobile banking.

Senior Bank officials told, “Roll out of the SSBCs is aimed at increasing customer convenience and improving access to financial services.”

Recently SBI Chairman OP Bhatt inaugurated the Centre soon it will be opened for public.

India is possible a unique to country to have an extensive and elaborated program of financial inclusion. Currently it has tied-up with state-run Banks to provide 40 per cent of their lending to customers from the priority sector, including agriculture, artisans, small and medium enterprises and scheduled castes and tribes.

Most of the government owned banks are giving loans to students for pursuing studies, which is growing rapidly.

The public sector banks are also in the process of covering the unbanked sectors of the economy in the urban and rural areas where up till now banking has not reached. In these areas large segment of society remains under the clutches of money lenders, who charge exorbitant rate of interest.

The state-owned banks are also taking new measures to reach out to the less privileged groups and those having problems by virtue of a chance of birth or that developed later on in life. They need compassion and help.

The private sector banks who are earning profit are also reluctant to start such services the Banks like HSBC has already started offering financial inclusion services.

In countries like South Africa, the banking services are highly expensive for common customers. For instance, on not maintaining minimum balance in the account the banks charge for this, there is charge for account statement also.

In spite of a nationwide program of Black empowerment, the black population of South Africa is still poor and finding difficulty in using financial services, including banking and insurance.

According to experts India is being looked as a role model by many countries for other developing countries to follow especially for financial services. India banking sector was not much affected by the global meltdown while the banking sector in the West faced very bad financial crisis. The Indian banking sector financial services include elaborate program of financial inclusion and now special facilities for certain sections like women and small enterprises and the latest special services for visually handicapped persons by the biggest bank of the country.

Public sector banks fix base rate at 8.25%, higher than SBI

Most of the public sector banks were looking at country’s largest lender the State Bank of India for setting their base rates. Now most of them have fixed their minimum base rate in the range of 7.75 per cent to 8.25 per cent, higher than that of market leader SBI.

From July 1, the new rate system has replaced the Benchmark Prime Lending Rate (BPLR) that varies between 11-13.75%. The new lending rate system has been introduced to bring about more transparency in the lending operations of banks.

Bank of Baroda, Oriental Bank of Commerce, Allahabad Bank, Bank of India, Indian Bank and IDBI Bank have set their rate at 8 per cent. Syndicate Bank, Dena Bank and Indian Overseas Bank have fixed it at 8.25 per cent.

Among the private sector banks Dhanalakshmi Bank and DBS Bank India have fixed the rate at 7 per cent, lower than that of SBI, while Karur Vysya Bank’s- Kerala based private sector lender has fixed the rate at 8.5%.

Mangalore based Corporation Bank, State Bank of Mysore and Federal Bank has fixed the rate at 7.75 per cent. UCO bank has fixed its rate at 8 per cent.

Under this new system banks will charge interest rates over the base rate depending on borrower’s credit profile. RBI has clarified that the new system will not be applicable to concessional loans such as agriculture, export and other specified sectors.

The base rate system will be applicable for all new loans as well as existing loans that come up for renewal. Existing loans based on the BPLR system might continue till maturity of the existing contract and will be renewed on the basis of new system.

The existing borrowers have been given the option to switch over to the base rate system before the renewal or expiry of the existing contract without any charges.