RBI suspects derivatives action at India's private banks may have ramped up in unknown exposure , likely as it proceeds to find out the exact proportions of derivatives profits and exposures in prop trading at ICICI banka nd other aggressive partcipants. the other parts of the FSR released today are the usual continuing challenge fron the currency failure in terms of imported inflation and the rising / doubling of PSE NPAs by 2013. 

Yes Bank has upped savings  rate to 7% and with equities out of action and sub continent deal movement slow to catch the Santa fever Q3 and Q4 are going to be a damp squib. Yes Bank also rerports a 30% increrase in Savings account cash with the bank at the ealier 6% rate fromt he rate deregulation in August.

The 4th edition of the FSR sees the Financial stability as three pillars of Macro stability and market stability apart from Banking stability,. while we grew as a nation when we proved the third last pillaer from the 25% share of private and foreign banks, the macro and maret stability are suspect for 2012 as a whole and the Financial stability quotient remains stable because of the banks at a little above 0.4%.

Asia has shown itself suspect to the European crisis and India has not been able to become a benefactor for our such neighbours or those in Norrth Asia, rather constricting ourselves into a bind with below 7% growth and declines in CRAR despite lower and uneasier credit growth with upward sloping NPAs ridden by the late systemisation initiative at our public sector monolith

India itself has seen the risky trade in real estate and unsecured loans cross up against declining credit to industry without gains to welfare and infrastructure we had strived to.

There has been considerable deterioration between March 2011 and September 2011 in Macro stability which is the challenge as the banking sector has grown amid the challenges building more volume in RTGS and other payment systems and growth in NBFC with stable capital ratios albeit with bank systemn credit

 

Posted via email from The India Investment Post