Discusses briefly shadow banks, their role in the subprime crisis, their activities in China, and the regulations and measures taken to control or reduce the negative effects of those financial institutions on the world economy.
Discusses briefly shadow banks, their role in the subprime crisis, their activities in China, and the regulations and measures taken to control or reduce the negative effects of those financial institutions on the world economy.
Challenges for banking in current scenarioHumsi Singh
The presentation describes the challenges faced by the banking sector in today's scenario. It tells about the various problems faced by banks nowadays.
Basel Accords - Basel I, II, and III Advantages, limitations and contrastSyed Ashraf Ali
The Basel Accords is referred to the banking supervision Accords (recommendations on banking regulations). Basel I, Basel II and Basel III was issued by the Basel Committee on Banking Supervision (BCBS). They are called the Basel accords as the BCBS maintains its secretariat at the Bank for
International Settlements in Basel, Switzerland and the committee normally meets there. The Basel Accords is a set of
recommendations for regulations in the banking industry.
A set of international banking regulations put forth by the Basel Committee on Bank Supervision, which set out the minimum capital requirements of financial institutions with the goal of minimizing credit risk. Banks that operate internationally are required to maintain a minimum amount (8%) of capital based on a percent of risk-weighted assets.
Introduction to Banking, Evolution of Banking, History of Banking system, Route map from traditional banking to Modern banking, Modern Banking system and its evolution, Growth of Indian Banking System
Challenges for banking in current scenarioHumsi Singh
The presentation describes the challenges faced by the banking sector in today's scenario. It tells about the various problems faced by banks nowadays.
Basel Accords - Basel I, II, and III Advantages, limitations and contrastSyed Ashraf Ali
The Basel Accords is referred to the banking supervision Accords (recommendations on banking regulations). Basel I, Basel II and Basel III was issued by the Basel Committee on Banking Supervision (BCBS). They are called the Basel accords as the BCBS maintains its secretariat at the Bank for
International Settlements in Basel, Switzerland and the committee normally meets there. The Basel Accords is a set of
recommendations for regulations in the banking industry.
A set of international banking regulations put forth by the Basel Committee on Bank Supervision, which set out the minimum capital requirements of financial institutions with the goal of minimizing credit risk. Banks that operate internationally are required to maintain a minimum amount (8%) of capital based on a percent of risk-weighted assets.
Introduction to Banking, Evolution of Banking, History of Banking system, Route map from traditional banking to Modern banking, Modern Banking system and its evolution, Growth of Indian Banking System
PPT - ROLE OF NBFC DEBT IN MERGERS AND AQUISITIONS.pptxLEDROIT1
A Non-banking Financial Company (NBFC) is defined by The Reserve Bank of India ‘as a company registered under the Companies Act, 1956 engaged in the business of loans, advances, acquisitions of government securities or local authority or other securities of like marketable nature, leasing, hire-purchase, insurance or chit business, etc.’
April 2014 Edition of BEACON, A Monthly Newsletter by SIMCON.
Inside this issue:
INDUSTRY ANALYSIS : Non Banking Financial Company
COMPANY ANALYSIS : STFC Ltd.
Concept of the Month
Quiz
Did You Know?
how can I sell pi coins after successfully completing KYCDOT TECH
Pi coins is not launched yet in any exchange 💱 this means it's not swappable, the current pi displaying on coin market cap is the iou version of pi. And you can learn all about that on my previous post.
RIGHT NOW THE ONLY WAY you can sell pi coins is through verified pi merchants. A pi merchant is someone who buys pi coins and resell them to exchanges and crypto whales. Looking forward to hold massive quantities of pi coins before the mainnet launch.
This is because pi network is not doing any pre-sale or ico offerings, the only way to get my coins is from buying from miners. So a merchant facilitates the transactions between the miners and these exchanges holding pi.
I and my friends has sold more than 6000 pi coins successfully with this method. I will be happy to share the contact of my personal pi merchant. The one i trade with, if you have your own merchant you can trade with them. For those who are new.
Message: @Pi_vendor_247 on telegram.
I wouldn't advise you selling all percentage of the pi coins. Leave at least a before so its a win win during open mainnet. Have a nice day pioneers ♥️
#kyc #mainnet #picoins #pi #sellpi #piwallet
#pinetwork
how to sell pi coins on Bitmart crypto exchangeDOT TECH
Yes. Pi network coins can be exchanged but not on bitmart exchange. Because pi network is still in the enclosed mainnet. The only way pioneers are able to trade pi coins is by reselling the pi coins to pi verified merchants.
A verified merchant is someone who buys pi network coins and resell it to exchanges looking forward to hold till mainnet launch.
I will leave the telegram contact of my personal pi merchant to trade with.
@Pi_vendor_247
when will pi network coin be available on crypto exchange.DOT TECH
There is no set date for when Pi coins will enter the market.
However, the developers are working hard to get them released as soon as possible.
Once they are available, users will be able to exchange other cryptocurrencies for Pi coins on designated exchanges.
But for now the only way to sell your pi coins is through verified pi vendor.
Here is the telegram contact of my personal pi vendor
@Pi_vendor_247
Even tho Pi network is not listed on any exchange yet.
Buying/Selling or investing in pi network coins is highly possible through the help of vendors. You can buy from vendors[ buy directly from the pi network miners and resell it]. I will leave the telegram contact of my personal vendor.
@Pi_vendor_247
The Evolution of Non-Banking Financial Companies (NBFCs) in India: Challenges...beulahfernandes8
Role in Financial System
NBFCs are critical in bridging the financial inclusion gap.
They provide specialized financial services that cater to segments often neglected by traditional banks.
Economic Impact
NBFCs contribute significantly to India's GDP.
They support sectors like micro, small, and medium enterprises (MSMEs), housing finance, and personal loans.
Empowering the Unbanked: The Vital Role of NBFCs in Promoting Financial Inclu...Vighnesh Shashtri
In India, financial inclusion remains a critical challenge, with a significant portion of the population still unbanked. Non-Banking Financial Companies (NBFCs) have emerged as key players in bridging this gap by providing financial services to those often overlooked by traditional banking institutions. This article delves into how NBFCs are fostering financial inclusion and empowering the unbanked.
how to swap pi coins to foreign currency withdrawable.DOT TECH
As of my last update, Pi is still in the testing phase and is not tradable on any exchanges.
However, Pi Network has announced plans to launch its Testnet and Mainnet in the future, which may include listing Pi on exchanges.
The current method for selling pi coins involves exchanging them with a pi vendor who purchases pi coins for investment reasons.
If you want to sell your pi coins, reach out to a pi vendor and sell them to anyone looking to sell pi coins from any country around the globe.
Below is the contact information for my personal pi vendor.
Telegram: @Pi_vendor_247
Financial Assets: Debit vs Equity Securities.pptxWrito-Finance
financial assets represent claim for future benefit or cash. Financial assets are formed by establishing contracts between participants. These financial assets are used for collection of huge amounts of money for business purposes.
Two major Types: Debt Securities and Equity Securities.
Debt Securities are Also known as fixed-income securities or instruments. The type of assets is formed by establishing contracts between investor and issuer of the asset.
• The first type of Debit securities is BONDS. Bonds are issued by corporations and government (both local and national government).
• The second important type of Debit security is NOTES. Apart from similarities associated with notes and bonds, notes have shorter term maturity.
• The 3rd important type of Debit security is TRESURY BILLS. These securities have short-term ranging from three months, six months, and one year. Issuer of such securities are governments.
• Above discussed debit securities are mostly issued by governments and corporations. CERTIFICATE OF DEPOSITS CDs are issued by Banks and Financial Institutions. Risk factor associated with CDs gets reduced when issued by reputable institutions or Banks.
Following are the risk attached with debt securities: Credit risk, interest rate risk and currency risk
There are no fixed maturity dates in such securities, and asset’s value is determined by company’s performance. There are two major types of equity securities: common stock and preferred stock.
Common Stock: These are simple equity securities and bear no complexities which the preferred stock bears. Holders of such securities or instrument have the voting rights when it comes to select the company’s board of director or the business decisions to be made.
Preferred Stock: Preferred stocks are sometime referred to as hybrid securities, because it contains elements of both debit security and equity security. Preferred stock confers ownership rights to security holder that is why it is equity instrument
<a href="https://www.writofinance.com/equity-securities-features-types-risk/" >Equity securities </a> as a whole is used for capital funding for companies. Companies have multiple expenses to cover. Potential growth of company is required in competitive market. So, these securities are used for capital generation, and then uses it for company’s growth.
Concluding remarks
Both are employed in business. Businesses are often established through debit securities, then what is the need for equity securities. Companies have to cover multiple expenses and expansion of business. They can also use equity instruments for repayment of debits. So, there are multiple uses for securities. As an investor, you need tools for analysis. Investment decisions are made by carefully analyzing the market. For better analysis of the stock market, investors often employ financial analysis of companies.
USDA Loans in California: A Comprehensive Overview.pptxmarketing367770
USDA Loans in California: A Comprehensive Overview
If you're dreaming of owning a home in California's rural or suburban areas, a USDA loan might be the perfect solution. The U.S. Department of Agriculture (USDA) offers these loans to help low-to-moderate-income individuals and families achieve homeownership.
Key Features of USDA Loans:
Zero Down Payment: USDA loans require no down payment, making homeownership more accessible.
Competitive Interest Rates: These loans often come with lower interest rates compared to conventional loans.
Flexible Credit Requirements: USDA loans have more lenient credit score requirements, helping those with less-than-perfect credit.
Guaranteed Loan Program: The USDA guarantees a portion of the loan, reducing risk for lenders and expanding borrowing options.
Eligibility Criteria:
Location: The property must be located in a USDA-designated rural or suburban area. Many areas in California qualify.
Income Limits: Applicants must meet income guidelines, which vary by region and household size.
Primary Residence: The home must be used as the borrower's primary residence.
Application Process:
Find a USDA-Approved Lender: Not all lenders offer USDA loans, so it's essential to choose one approved by the USDA.
Pre-Qualification: Determine your eligibility and the amount you can borrow.
Property Search: Look for properties in eligible rural or suburban areas.
Loan Application: Submit your application, including financial and personal information.
Processing and Approval: The lender and USDA will review your application. If approved, you can proceed to closing.
USDA loans are an excellent option for those looking to buy a home in California's rural and suburban areas. With no down payment and flexible requirements, these loans make homeownership more attainable for many families. Explore your eligibility today and take the first step toward owning your dream home.
how can i use my minded pi coins I need some funds.DOT TECH
If you are interested in selling your pi coins, i have a verified pi merchant, who buys pi coins and resell them to exchanges looking forward to hold till mainnet launch.
Because the core team has announced that pi network will not be doing any pre-sale. The only way exchanges like huobi, bitmart and hotbit can get pi is by buying from miners.
Now a merchant stands in between these exchanges and the miners. As a link to make transactions smooth. Because right now in the enclosed mainnet you can't sell pi coins your self. You need the help of a merchant,
i will leave the telegram contact of my personal pi merchant below. 👇 I and my friends has traded more than 3000pi coins with him successfully.
@Pi_vendor_247
Introduction to Indian Financial System ()Avanish Goel
The financial system of a country is an important tool for economic development of the country, as it helps in creation of wealth by linking savings with investments.
It facilitates the flow of funds form the households (savers) to business firms (investors) to aid in wealth creation and development of both the parties
where can I find a legit pi merchant onlineDOT TECH
Yes. This is very easy what you need is a recommendation from someone who has successfully traded pi coins before with a merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi network coins and resell them to Investors looking forward to hold thousands of pi coins before the open mainnet.
I will leave the telegram contact of my personal pi merchant to trade with
@Pi_vendor_247
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
The WhatsPump Pseudonym Problem and the Hilarious Downfall of Artificial Enga...
shadow banking
1. The Shadow Banking
Under the guidance of:
Bhagat Singh Bisht Sir
Section A , Group 8
Chandni Soni
Manjari Priya
Dheeraj Singh
Rahul Kumar
Ankur Kumar
Rohit Sharma
Akshat KumarSrivastava
2. Overview
Topics Presenter
Introduction Dheeraj Singh
Mechanism of Shadow Banking Chandni Soni
Rise and Growth of Shadow banking in India Manjari Priya
Present Scenario Ankur Kumar
Policy Responses & Interventions in the Indian
Shadow Banking Sector
Rohit Sharma
Funding and Recent defaulters in Shadow
Banking sector in India
Rahul Kumar
Major impacts on shadow banking due to
COVID-19 pandemic & Conclusion
Akshat Kumar Srivastava
3. What is Shadow Banking?
The term “shadow bank” was coined by economist
Paul McCulley in his 2007 speech.
Shadow banking system:
The Nonbanking Financial Institutions (NBFIs) providing banking services operating under
regulatory frameworks other than that of the commercial banks and are known for lending to
comparatively riskier ventures.
• In general, it includes : Investment Banks, Mortgage Lenders, Money Market Funds, Insurance
Companies, Hedge Funds, Fixed Income Funds, Housing Finance Companies (HFCs) etc.
• These financial institutions act like banks are not supervised like banks.
• The shadow banking system provides a free pass to the banks to circumvent any regulation.
• The shadow banking system is said to grow and diminish in size.
However, it never vanishes.
4. Why?
• Competitive pressures force banks to undertake more risks and if possible
earn a higher rate on their investments.
• This is what created a parallel financial universe called the shadow banks.
When did started?
• These firms proliferated mainly when traditional banks were pulling back
from lending due to the imposition of strict norms after the 2007 crisis.
• According to the Financial Stability Oversight Council 2019 report,
nonbanks now originate over half of all new mortgages, which are 10
percent higher than the mortgage lending level of the 2007 financial
crisis.
5. The concept of shadow banking varies across countries:
• In Europe : Lending by insurance companies.
• In China : Wealth management products offered by
banks.
In INDIA
• Shadow banking institutions play an important role by
providing credit to inaccessible areas or to niche
sectors and small industries besides lending to the
established businesses.
• Create simultaneous credit flow in addition to the credit
lines provided by the Scheduled Commercial Banks (SCBs).
• Shadow banking institutions regulated by the RBI include: All-India Financial
Institutions (AIFIS), Non-Banking Financial Companies (NBFCS), Primary Dealers (PDS)
and Housing Finance Companies (HFCS).
6. Few examples of Shadow Banking in India are:
Power Finance Corporation Limited
Shriram Transport Finance Company Limited
Bajaj Finance Limited
Mahindra & Mahindra Financial Services Limited
Muthoot Finance Ltd
HDB Finance Services
Cholamandalam
Tata Capital Financial Services Ltd
L & T Finance Limited
Aditya Birla Finance Ltd etc.
8. The “market view” perspective of shadow
banking
Begin with plain and simple (vanilla) banks.
Here vanilla banks are considered as
intermediaries between savers (lenders)
and investors (borrowers).
9. Banks as financial intermediaries
This model suffers from several problems arising from a mismatch of
characteristics of assets and liabilities of the bank.
First, the asset held by the bank (loan to the borrower) may be long-
term while the liabilities of the bank (deposits held by lenders) can
be withdrawn on demand (short-term).
10. The emergence of shadow banks with
repo arrangements
This arrangement also allowed banks to better match maturities
of assets and liabilities.
It called for mark-to-market monitoring of the government
security price and adjustment of contracts between the shadow
bank and commercial bank.
11. Emergence of a disaggregated shadow
banking system
Begin with borrowers who approach a bank for loans against deposits/cash.
The bank complies. It then sets up a Special Purpose Vehicle or SPV (a distinct entity
from the bank) which buys these loans from the bank, repackages them and sells them
as Asset Backed Securities (ABS) to lenders in the market.
Financial institutions (FIs) like mutual funds, pension funds or insurance companies.
12. The money circuit view of shadow banking
The money view of shadow banking.
This view conceives of shadow banks as institutions which
temporarily close the money circuit by substituting deposits
(liabilities) on the banks’ balance sheets with the loan liabilities of
borrowers (asset to shadow banks).
13. The mechanism of Indian NBFCs
Following the market-view, India’s shadow banks or NBFCs are a network of
intermediaries connecting savers to investors, their vital service being credit
transformations.
More specifically, short-term borrowing through issue of commercial paper (CP) for
longer-term lending in infrastructure projects like roads and highways, power plants,
ports, real estate and so on.
15. Several factors have contributed to the phenomenal growth
of shadow banks in India.
• The trigger would be 1991 economic reform which saw the
implementation of the three pillars of the IMF’s structural
adjustment program – liberalization, privatization and
globalization.
• The process of liberalization also allowed the interconnection
among as well as between shadow banks and traditional
commercial banks.
• The structural reforms of 1991 triggered the need for alternative
sources of finance to commercial banking and informal sources
of finance.
16. In India, Shadow banking institutions regulated by the
RBI include :
• All – India financial Institutions (AIFIs)
• Non-banking financial companies (NBFCs)
• Primary dealers (PDs) and
• Housing Finance Companies (HFCs)
• In the developing countries like India, NBFCs play supplementary
role to banks.
• When Banks are not able to provide their services due to legal
restrictions, it becomes easy for NBFCs to provide financial
services to such customers.
17. In India, as on 31st March 2019
9,659 NBFCs registered with the RBI
88 were deposit accepting NBFCs
263 systematically important non-deposit
accepting NBFCs.
• As on March 31, 2019, the total assets of NBFCs and
HFCs was Rs 44.4 lakh crore
(NBFCs: 70 per cent; HFCs: 30 per cent)
• Approximately one-fourth the size of the assets of
the scheduled commercial banks (Rs166 lakh crore).
18. GROWTH OF SHADOW BANKS
• Apart from the recent fall in credit growth by the NBFIs
arising out of fund crisis as a fall out of failures of few big
NBFCs.
• But still there was a High Growth till FY 2018.
High Growth Trends In The Indian Shadow Banking Sector Till FY 2018
19. • RBI data shows that the consolidated balance sheet size
of the NBFC sector grew 20.6% to INR 28.8trillion in FY19
as an increase of 17.9% to INR 24.5 trillion in FY18.
• Important source of funds to the NBFCs in India is
commercial banks.
• Apart from banks, the major lenders of funds to NBFCs
are: Mutual funds (MFs), which stood at about Rupees
2,300 billion (US$33 billion8) as at March-end (2018).
21. • In India: $ 190 billion, which is the 15th largest in the world
• At the global level: $52 trillion industry
• A 75 percent increase from the year 2010 level
• Among the BRICS, India has the third-largest shadow banking sector.
As on 31st March 2019.
• 9,659 NBFCs registered with the RBI
• 88 deposit accepting NBFCs
• 263 systemically important non-deposit accepting NBFCs
• 802 NBFCs have asset size INR 100 crore and above
Distribution of NBFC Credit
22. • RBI data shows that the consolidated balance sheet size of the NBFC sector grew
20.6 percent to INR 28.8 trillion in FY19 as against an increase of 17.9 percent
to INR 24.5 trillion in FY18.
• The Return on Assets (RoA) decreased to 1.5 percent as on March 2019, from
1.6 percent as on March 2018.
• Gross NPA of the NBFC sector as a percentage of total advances increased:
From 5.8 percent in FY18 to 6.6 percent in FY19.
NPA percentages are always higher for the SCBs
Trends of NPA in two parallel financial sectors
24. Few important measures have been taken for the
shadow banking sector during the union budget of
the year 2020.
The asset size has been reduced from INR 500 crore to INR 100 crore
or loan size from existing INR 1 crore to INR 50 lac for debt recovery
under the SARFAESI Act 2002.
Securities will be floated by NBFC under the Partial Credit Guarantee
scheme to infuse liquidity to the shadow banking system.
Necessary amendments will be done to the factoring Regulations Act
2011 to enable NBFCs to extend invoice financing to MSME.
25. Regulations
• The regulations of the shadow banking system are apparently
less stringent worldwide. In India, they are governed by the
Companies Act.
• NBFCs like HFCs, Venture Capital Fund Companies, Insurance
Companies, Chit Fund Companies etc are not required to be
registered under Section 45-IA of the RBI Act,1934.
• The government has advised the public sector banks (PSBs) to collaborate
with shadow banks for loans to SMEs, small traders and microfinance
institutions under the Co-origination scheme.
• Shadow banks will bear a minimum of 20 % of the credit risk by way of
direct exposure
• 80 % by co-originating PSB will take the rest of the credit risk
26. The importance of shadow banks in financing of much
needed investments in the economy and have therefore
taken adequate steps to allow growth in and deepening of
shadow banking in India.
The RBI focus in its recent announcements has been to
ensure higher attention on liquidity management by
shadow banks.
In a latest decision the RBI has increased the ceiling for a
bank’s exposure to a single NBFC to 20% of its tier 1
capital from 15% earlier (Ghosh and Prasad2019).
27. According to one of India's leading bankers the deft
handling of the situation through asset sales and
government control over IL&FS ensured that it did not turn
into a Lehman moment for India.
The SEBI has also issued new rules for the mutual fund
industry including mandatory holding of liquid assets (cash
and government securities).
29. During August 2019, RBI announced two key
measures to help liquidity in cash trapped NBFCs.
It decided to raise a bank’s exposure limit to a single NBFC to
20 percent of tier-I capital of the bank.
Secondly, RBI has decided to grant priority sector lending status
for credit to shadow banks for on-lending to agriculture, SMEs
and housing; and reduced risk weights for consumer loans.
30. Recent defaults in the shadow banking
sector in India
• A 2017 report by the RBI showed that 99.7 percent of
shadow banking in India involves making long-term loans
against short-term funding.
• Collapse of IL&FS in 2018, followed by DHFL, Reliance Home
Finance Ltd and Altico Capital India Ltd all these NBFCs suffered
from the asset-liability mismatch.
• Basel, Switzerland-based Financial Stability Board (FSB): has estimated warning for
Indian Shadow Banking.
• Credit Suisse report : Concentration risks i.e. too much exposure only to few sectors
cause concern.
Loans to housing finance sector are of around 21 percent of NBFCs’ loan book,
compared to 7 percent for private banks and 3 percent for PSBs.
32. The consequence of the COVID-19 pandemic is going to slow down the
rapid growth of the NBFIs as well as the growth of the entire economy
worldwide.
Most of the NBFCs have already lost close to approximately 30
percent to 40 percent value in the stock market worldwide.
NBFIs heavily relying on digital processing of transactions are
getting their processes disrupted due to hardware shortages from
countries like Korea and China as their activities are stopped too.
34. The shadow banking sector plays an important role in the Indian
financial system, by providing credit, especially to the retail and
small-company sectors.
The shadow banking sector in India accounts for a relatively small share
of the total assets of the financial system as a whole where the share of
lending by the PSBs accounts for nearly 70 percent of the total assets.
In the end, after the present health crisis is over, under effective and
adequate regulations and sufficient flow of liquidity, the shadow banks
are once again going to pose very tough competition to the traditional
banks.
Editor's Notes
Because where the banks are not able to provide their services due to legal restrictions, it becomes easy for NBFCs to provide financial services to such customers.
But the chart given below clearly depicts the high growth trends in the Indian shadow banking sector till FY 2018.