Banking Sector

The auction for the additional tier-I bond is expected to be held on August 30 on the BSE's bidding platform. The source expects there will be higher demand for the bonds from the investors considering the issuances taken place in few days where coupon has been set lower. "On the upcoming AT1 bond of Bank of Baroda, we expect coupon to set between 7.80 per cent and 8.00 per cent," the source cited said.

The RBI came out with its report, drawing the data from the abridged quarterly financial results of 2,749 listed private non-financial companies. "Sales growth (yoy) of listed private non-financial companies surged to 41.0 per cent in Q1:2022-23 from 22.3 per cent in the previous quarter," it said. According to the RBI, manufacturing logged sales growth of 41.6 per cent driven by broad based demand expansion across industries aided by both volume and price effects.

According to the data compiled by Prime databases, companies and banks raised Rs 45,237.15 crore so far this year, as compared to Rs 77,845 crore amount raised in the similar period last year. "A higher US interest rates especially in the shorter end of the curve coincided with weakening Rupee made the borrowing cost higher for Indian Corporates to tap the foreign bond market," said Venkatakrishnan Srinivasan, founder and managing partner at Rockfort Fincorp LLP, a Mumbai-based debt advisory firm.

As per data, Canara Bank will raise Rs 2,000 crore, which includes Rs 1,000 crore via Basel-III Tier-II bonds, Kotak Mahindra prime Ltd will raise Rs 300 crore and Rs 175 crore via 35-month-25-day and 47-month-25-day, respectively. While, Tata Capital Housing Finance Ltd will raise Rs 245 crore via 118-month bonds, and Sundaram Finance Ltd is to raise Rs 500 crore via 36-month bonds.

According to the report, the cases admitted through IBC in Q1FY23 is 332, compared to 139 cases admitted in the same period previous year. IBC is gaining prominence as operational creditors lead new case admissions; 50 per cent cases were initiated by operational creditors and 40 per cent by financial creditors. Of the 3,600 cases that were closed until 1QFY23, only 14 per cent were resolved while 47per cent faced liquidation.

According to the data compiled by Prime database, banks have so far raised around Rs 42,000 crore through CDs. This was even after the rates on this instruments are rising sharply. The data also showed that Indian Bank, topped the fund raising list via CDs, raising worth Rs 13,550 crore, which was followed by HDFC Bank raising Rs 6,550 crore and Punjab National Bank raising Rs 2,875 crore so far in August.

"The recent cool off in key commodity prices viz. metals, crude among others, comes as a breather for global equity markets, which are currently wary of ongoing geopolitical issues and interest rate hikes by central banks to control inflation," the report notes. Management commentary is upbeat on demand prospects and recovery in margin profile amid muted corporate earnings for Q1FY23, which witnessed low single digit QoQ growth in topline and double digit bottomline decline with pressure on gross margins.

Large scale privatisation of PSBs or the big bang approach will do more harm than good, said Snehal S. Herwadkar, Sonali Goel and Rishuka Bansal of the Banking Research Division, Department of Economic and Policy Research, in an article published in the RBI's monthly bulletin. "The government has already announced its intention to privatize two banks.

Small savings schemes like Public Provident Fund (PPF), National Savings Certificate (NSC), Post Office Savings Scheme and Sukanya Samriddhi Yojana are vital savings instruments for the common man, as they provide long-term benefits. However, given that both public and private sector banks have raised their term deposit as well as home loan rates drastically since May 2022, keeping the rates of small savings schemes unchanged for the past two years has come as a surprise.

The net profit of public sector banks rose 9.2 per cent to Rs 15,307 crore, while that of private banks increased at a faster pace of 54.9 per cent to Rs 28,165 crore in Q1FY23. The report has analysed the financial performance of 35 banks of which 12 are public, 19 private while the remaining are small finance banks."We have looked at the key indicators of profitability, margins and efficiency ratios for the consolidated groups," the report said.