The Reserve Bank of India on Wednesday clarified that floating provisions were only for contingencies under extraordinary circumstances for making specific provisions.
The Reserve Bank of India (RBI) said in a notification that the term lending and refinance companies cannot use floating provisions in place of specific provisioning.
Only under extraordinary circumstance, with prior permission from the company’s board and the RBI can these term lending institutions write back the floating provisions for making specific provisions, RBI said.
These lending institutions are National Housing Bank, National Bank for Agriculture and Rural Development, Export Import Bank, and Small Industries Development Bank of India.
Provisions are funds that banks set aside from their profit on expectations of any loss of the money lent or invested. While the extent of specific provisions are specified by RBI, decision to keep floating provisions is upto the financial institution.
In India, mutual funds companies have the second largest corpus of investments after life insurance companies. The options for investments are many with mutual funds, though the first thing anyone new investments thinks is equity mutual funds. But mutual funds can be made of any asset class.
Mutual fund type based on asset class
Mutual funds can be of different types based on what they are composed of. They can be
Equity based
Debt based
Money market based
Balanced
An equity fund invests most of its corpus in equity shares. The type of companies to invest in depends on the fund philosophy. A debt fund invests in bonds, deposits and government securities. The money market fund invests in the money market. The balanced fund mixes equity and debt is proportions as determined by the fund philosophy.
Current income
The quantum of current income from an equity mutual fund depends on its fund payout choice. The choices generally are:
Dividend payout option
Dividend reinvestment option
Growth Option
One of the fall-outs of the economic boom is that salaried class is ageing early in life. Ask a 40-year old professional about his retirement age and his answer would be tomorrow.
Of course, most of them would like to retire financially without the troubles of ensuring cash flow on a monthly basis through salary. While retiring at 40 would mean a retired life of another 40 years, it hasn’t dithered many from dreaming about retirement life.
What a contrast to the older generation, which wanted to go on and on and has even managed to push the retirement age upwards. In fact, many of us would recollect as to how our parents hated the last day of their job even after putting in three decades of service in a single company!
As the year 2009 draws to a close most investors would be relieved that the market treated us much more kindly than what it did in the previous year. In 2008, the Sensex lost over half its value, falling from levels of 20500 in January to around 9500 in December. Just as investors were losing hope, a recovery of sorts started and the valuations once again doubled from the previous December levels.
However, we shouldn’t get carried away. Sometime back we were celebrating 10000 then 12000, then 15000 then 18000 and so on. If our economy continues to grow the way it has and our corporate sector continues to perform, the Sensex has to rise.
Its pure cause and effect. So we wouldn’t be surprised if soon a time arrives when we look forward to a level of 25000 and beyond. However, no matter what stock market analysts and other storytellers will have you believe, no one can predict when this will happen. It could take a less than a year or even three – it’s the future and no one can predict the same with accuracy.
Oxford University researchers have developed a new technology that enables safe payments to be made through mobile phones. The technology, designed by Professor Bill Roscoe of the Computing Laboratory and colleagues, will now be lunched into the market by Isis Innovation, the university’s technology transfer company.
Prof Roscoe said: “A key requirement of new payment systems will be the ability to make payments from person to person, such as paying a builder or a friend.
“What we have is technology which enables anyone to easily create a secure connection between two devices: it can work via Bluetooth, WiFi, the internet or across ordinary telephone or SMS connections.
“The core of our technology is a new security protocol that enables strong cryptographic keys to be created with the least possible work. The key to the protocol is that it prevents anyone from doing any searching to break into the transaction.”
A user of the technology checks if a 4-8 digit numeric code generated within their own phone matches with the one generated by the payee. This number is random and there is no need to maintain secrecy. This guarantees that the customer’s mobile is connected to the correct store, or to the cell phone of the person they have to pay. Thereafter, the payment takes place without exchanging sensitive details like credit card numbers or PIN.
Indian Bank has revised interest rates on FCNR (B) and NRE deposits with effect from January 1. For FCNR (B) deposits, in US Dollar the revised interest rate has been fixed at 1.98 per cent for deposits of one year and above but less than two years (2.02 per cent existing); at 2.39 per cent.
For deposits of two years and above but less than three years (2.01 per cent existing) at 3.04 per cent for deposits of three years and above but less than four years (2.56 per cent existing); at 3.54 per cent.
For deposits of four years and above but less than five years (3.00 per cent existing); and at 3.94 per cent for deposits of five years only (3.36 per cent existing).
For NRE term deposits, the revised interest rate has been fixed at 2.73 per cent for one year and above but less than two years (2.77 per cent existing); at 3.14 per cent.
For two years and above but less than 3 years (2.76 per cent existing); and at 3.79 per cent for deposits of 3 years and above and upto 5 years (3.31 per cent existing), a Bank release here said.