...Risk-Based Inspection API RECOMMENDED PRACTICE 580 SECOND EDITION, NOVEMBER 2009 --``,,,,,``,,`,``,``,`````````,,-`-`,,`,,`,`,,`--- --``,,,,,``,,`,``,``,`````````,,-`-`,,`,,`,`,,`--- Risk-Based Inspection Downstream Segment --``,,,,,``,,`,``,``,`````````,,-`-`,,`,,`,`,,`--- API RECOMMENDED PRACTICE 580 SECOND EDITION, NOVEMBER 2009 Special Notes API publications necessarily address problems of a general nature. With respect to particular circumstances, local, state, and federal laws and regulations should be reviewed. API is not undertaking to meet the duties of employers, manufacturers, or suppliers to warn and properly train and equip their employees, and others exposed, concerning health and safety risks and precautions, nor undertaking their obligations under local, state, or federal laws. Information concerning safety and health risks and proper precautions with respect to particular materials and conditions should be obtained from the employer, the manufacturer or supplier of that material, or the material safety datasheet. Neither API nor any of API’s employees, subcontractors, consultants, or other assigns make any warranty or representation, either express or implied, with respect to the accuracy, completeness, or utility of the information contained herein, or assume any liability or responsibility for any use, or the results of such use, of any information or process disclosed in this publication, or represent that its used would...
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...Analysis of Financial Ratios CV.Alexander DGM &FM Version: College of Agricultural Banking, RBI, PUNE 1 Definition • The relationship between two accounting figures expressed mathematically is known as financial ratio Date: College of Agricultural Banking, RBI, PUNE 2 Introduction • What is the purpose of analysis of financial ratios – It is for a meaningful study of information in the financial statements – Ascertaining overall financial position of a business organisation – Interpretation of key information in the financial statements Date: College of Agricultural Banking, RBI, PUNE 3 Objective • The objectives: – Assess credit risk profile of the borrower – Stipulation of terms and conditions – Assess utilization of credit facility – Establish sound well defined credit granting criteria – Ensure safety of bank funds Date: College of Agricultural Banking, RBI, PUNE 4 Factors that banks consider • • • • • • • • Credit worthiness of the borrower Integrity/reputation Credit risk profile Sensitivity to economic and market developments Liquidity Solvency Profitability of business Resource efficiency Date: College of Agricultural Banking, RBI, PUNE 5 Financial Analysis • Trends in the financial planning • Analysis of projected financial statements Date: College of Agricultural Banking, RBI, PUNE 6 Assets & Liabililities (Rs.crore) Liabilitiesm Year 3 2652 (436) 039 4065 Assets Year 1 2249...
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...Retail 0.4% $3.5 Total domestic IT market FY12 ~ USD 30.4 billion Overall, BFSI vertical is contributing significantly to the growth of the Indian economy; its share in Indian GDP is estimated at ~8% Source: Company Annual Reports and Press Releases; Dataquest; Primary Interviews with Stakeholders in the Indian IT Ecosystem; MOSPI; Zinnov Analysis Note: 2 The rapid diversification of the sector including Banks, NBFCs and Insurance presents huge IT opportunity Over 97,000 Scheduled Banks in India (235) Commercial Banks (166) Co-operative Banks (69) Unscheduled Banks Public Sector Banks (26) Nationalized Banks (20) Foreign Banks in India (33) Private Sector Bank (21) Regional Rural Banks (82) Urban Cooperatives (53) State Cooperatives (16) SBI and its Associates (6) Old private Sector Banks (14) New Private Sector Banks (7) NBFCs (12,409) Registered and Regulated by RBI Loan Company Investment Company Equipment Leasing Company Exemption from RBI regulations and registration Insurance Companies Stock Exchange, Stock brokers, etc. Housing Finance Companies Not registered but regulated by RBI* Mutual...
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...INTEREST RATES AND INDUSTRIAL GROWTH (2009-10 to 2011-12) Submitted By: Mohana Goel (12DM077) Mohit Bhola (12DM078) Nidhi Dalal (12DM090) Nishant Raj (12DM097) Nishtha Chugh (12DM098) Piyush Chib (12DM102) CONTENTS 1. INDIAN ECONOMY:Overview 2. INTEREST RATES 3.1. MEANING 3.2. REAL vs NOMINAL INTERST RATES 3.3. TYPES OF INTEREST RATES 3.4. EFFECT OF INTEREST RATE RISE 3. MONETARY POLICY 4.5. MEANING 4.6. OBJECTIVE 4.7. TOOLS 4.8. IMPORTANCE 4. 2009-10 5.9. OBJECTIVE OF MONETARY POLICY 5.10. POLICY STANCE 5.11. ANALYSIS 5.12. OBSERVATION 5. 2010-11 6.13. OBJECTIVE OF MONETARY POLICY 6.14. POLICY STANCE 6.15. ANALYSIS 6.16. OBSERVATION 6. 2011-12 7.17. OBJECTIVE OF MONETARY POLICY 7.18. POLICY STANCE 7.19. ANALYSIS 7.20. OBSERVATION 7. CONCLUSION 8. RECOMMENDATION 9. BIBLIOGRAPH INDIAN ECONOMY: AN OVERVIEW India is a South Asian country that is the seventh largest in area and has the second largest population in the world. India covers an area of 3,287,240 square km and its population stands at 1.215 billion people in 2010. Understanding the Indian Economy Large, dynamic and steadily expanding, the Indian economy is characterized by a huge workforce operating in many new sectors of opportunity. The Indian economy is one of the fastest growing economies and is the 12th largest in terms of the...
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...Five Force analysis of the Banking Industry in India The banking industry in India originated in the 18th century. It is an important sector as it focuses on the development of Indian Economy. The State Bank of India is the oldest bank which is still in existence. The major change in Indian banking industry happened post independence; with the nationalization of Reserve Bank of India (RBI) in 1949 and authority to RBI as a regulatory body for banks (Banking Regulation Act 1949). The major players in the Indian banking industry can be classified as: 1) Public sector banks like State Bank of India, Andhra Bank, Allahabad Bank, Punjab National Bank etc. 2) Private sector banks like HDFC bank, Axis bank, and ICICI bank etc. 3) Foreign banks like Citibank, HSBC bank, and Standard Chartered bank. This report consists of Micheal Porter’s Five Force analysis of five banks operating in the Indian Market wiz State Bank of India, Punjab National Bank, HDFC bank, ICICI Bank and Citibank. 1) Threat of new entrants: (high) Many multinational banks are attracted to enter the Indian banking sector to start their operations and provide services to Indian customers. Many, Non Banking Financial Companies (NBFC) are waiting to get their license from RBI. 2) Threat of Substitute products/services The threat of substitute products and services provided by the banking industry is very low. The substitutes to the banking services include local lender 3) Bargaining...
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...September 2013 CRISIL MonetaryPolicyReview RBI: Restricting Ballooning Inflation Figure 1:Average daily borrowings of banks from the RBI Rs. Billion 2500 2000 1500 Borrowings of the banking system Figure 2: Inflation: Up and rising %, y-o-y 12.0 10.0 8.0 Consumer price inflation 1000 6.0 500 09/16/2013 0 4.0 Wholesale price inflation 07/02/13 07/13/13 07/24/13 08/04/13 08/15/13 08/26/13 09/06/13 2.0 Nov-12 Dec-12 Jan-12 Jun-12 Oct-12 Jan-13 Feb-12 May-12 Jun-13 Feb-13 May-13 Mar-12 Aug-12 Mar-13 Apr-12 Jul-13 Jul-12 Net LAF MSF Note: LAF – Liquidity adjustment facility, M SF – M arginal standing facility Source: RBI, M inistry of Commerce and Industry, CSO, CRISIL Research In the mid-quarter policy review announced today, newly appointed Reserve Bank of India (RBI) Governor Raghuram Rajan stressed on inflation control while taking measures to ease the short-term borrowing cost. The central bank hiked the repo rate by 25 bps to 7.5 per cent, indicating RBI’s concerns on high inflation even in an anaemic growth environment. With WPI inflation now above 6.0 per cent and CPI at 9.5 per cent, this step was necessary to curtail inflation expectations. The announcement by the US Federal Reserve on September 18 about the postponement of QE3 (quantitative easing) withdrawal will aid the rupee in the near term. This has given RBI some leg room to partly reverse the extra liquidity...
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...relationship with skills that brought success to teams. Traditionally, baseball scouts mainly used batting averages (BA) and Runs batted in (RBI) to sign new players. On-base percentage (OBP) was used too, but it was not given as much premium as RBI and BA. Thus, when looking for players, almost all scouts went for players that scored highly on BA and RBI while ignoring those that scored highly on OBP but had low scores in BA and RBI. However, through analysis of massive amounts of data and reading Bill James’ series of baseball books Baseball Abstracts, Beane and his assistant, Paul DePodesta, found that OBP was the most important factor that determined a team’s success and not BA or RBI. Since OBP was not valued highly in players by most baseball scouts, Beane and DePodesta discovered that they could build a successful team of players with high OBP score but whom, because most top baseball teams had ignored them, could be paid much lower salaries than their counterparts could in big teams such as New York Yankees. Therefore, they could create a successful team on a much smaller budget than their competitors. Thus, the opportunity that Oakland A discovered was set up by scouts placing less premium on OBP, yet it was the most important skill in determining a team’s success. The belief that the players’ potential as measured by RBI and BA was more important than a player’s present performance as measured by OBP was adamant in baseball circles. It did not matter that the originator...
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...News analysis since 20th April 2013 The Economist • Speed isn’t everything For years critics of china have complained that it prizes over balance. Rapid development has taken it as the heavy investment has crowded out consumption & heavy industry has muscled out services. According to the new figures the loss of momentum & spectacular surge in the credit made the stock market unhappy. In short China is becoming more like a western economy with consumer & services to the fore that reinforce each other. Services are more labor intensive than industries are, their growth boosts wages & household income, fatter pay-packages, encourage consumption & consumer spending that favors services. “Results become cause & cause become results” This has made a huge contribution to China’s growth. The tightness in the labor market shows that China is operating close to its limits. Rather than chasing growth govt. has made shadow-banking regulation stricter, preserved with curbs on property speculation. The Economic Times 25th April 2013 • RBI strikes gold with its yellow metal stock It has earned 41% returns from gold reserves since 2009, 4 times more than other assets. • RBI may prod private bank to enforce KYC norms May push banks to rationalize commissions paid to their wealth & relationship managers in order to discourage dubious transactions. • Create more banks. Chit funds will die. Lack of financial inclusion. • Economists isn’t as smart as dentistry • When entrepreneurs...
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...Indian Banking – The engine for sustaining India’s growth agenda 5th ICC Banking Summit Kolkata 18 May 2013 Foreword Over the past couple of years, the Indian banking sector has displayed a high level of resilience in the face of high domestic inflation, rupee depreciation and fiscal uncertainty in the US and Europe. In order to stimulate the economy and support growth of the banking sector, the Reserve Bank of India (RBI) adopted several policy measures. © 2013 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Asset quality, capital adequacy, financial inclusion and talent management are some of the key issues facing the Indian banking industry, which despite serving the second largest populated country in the world with a total of 87 banks (including 26 public sector banks, 20 private banks and 41 foreign banks), as per the RBI, reaches out to only about half of the country’s households, scripting a nominal global footprint. The rising consumerism from the emerging ‘middle’ India and the higher purchasing power in rural India on account of rising employment provides opportunities for banks to look beyond the traditional customer segments. However, these segments would require flexible operating models which would ensure responsiveness at the last mile and at the same time be viable for the banks. On...
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...b) A moderate rise in intermediate goods prices c) Least hikes in prices of finished and consumer products In the light of these features and trends in inflation, ASSOCHAM suggests four pronged anti-inflationary package. These includes Structural Correction for Structural Inflation: This calls for a comprehensive action plan for the farm sector, involving among other measures, a programme for a “Horticultural revolution” for increasing productivity of fruits and vegetables, fish and poultry. Controlling form inflation is a joint responsibility of the union Government and RBI. Only monetary policy adjustment will not correct such trend price rises. 2 Hence, RBI need not raise policy rates every time form prices are rising, as analysis shows farm price are not responding to monetary policy changes. Manufactured good inflation is showing for greater responsiveness to monetary policy changes. RBI should concentrate more on controlling these prices Going into the disaggregated and Sectoral price behavior of manufacturing goods, we find the dynamics of change is more in upstream industries because of shortages. We suggest that upstream and intermediate goods prices rise should be contained by raising their production within the country. This will also have major implications for the current account. Hence, a Low-interest regime encouraging first investment for capacity creation in industrial sector could be the most effective way of containing spikes in...
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...business a bank is doing? How banks earn profit? What are the product and services offered by a bank? What assets and liability products of a bank? What is net interest margin (NIM)? What deposit mobilization? Why these days the mobilizations are going down? What are the factors effecting deposit mobilization of a bank? What is RBI Credit Policy and how RBI control money supply and interest rate (definition and importance of CRR, SLR, Repo rate, Reverse Repo rate and Bank rate). What are the Securities qualify for SLR requirement of a bank? What is Open Market Operation (OMO) of RBI? What is base rate of a bank, how it is different from BPLR (Banks Prime Lending Rate). What is Credit rating and how it helps banks in credit appraisal of company. What is the process of the credit rating? If client approaches you for a project loan than how you are going to assess the credit worthiness of the client (important ratios use for credit appraisal) dead services coverage ratio, interest coverage ratio, etc. If you are working with a bank then are the important ratios for credit appraisal? What are your strengths weakness for your banking jobs? Do your SWOT analysis for a bank job. What are the main functional areas in a bank for finance professionals (treasury related jobs, risk management, credit appraisal, loans indication, merchant banking). What is IRR, how it is used for project appraisal by a bank? What is loan indication? How it is done. What is under writing in this process? What...
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...Banking Frauds INTRODUCTION With the advances in information technology, most banks in India have migrated to core banking platforms and have moved transactions to payment cards (debit and credit cards) and to electronic channels like ATMs, Internet Banking and Mobile Banking. Fraudsters have also followed customers into this space. RBI had, per se, not defined the term ‘fraud’ in its guidelines on Frauds. A definition of fraud was, however, suggested in the context of electronic banking in the Report of RBI Working Group on Information Security, Electronic Banking, Technology Risk Management and Cyber Frauds, which reads as under:- 'A deliberate act of omission or commission by any person, carried out in the course of a banking transaction or in the books of accounts maintained manually or under computer system in banks, resulting into wrongful gain to any person for a temporary period or otherwise, with or without any monetary loss to the bank’. Statistics quoted in a recent report by the Association of Certified Fraud Examiners’ (ACFE) 2012 titled “Report to the Nation on Occupational Fraud and Abuse” has estimated that a typical organization loses 5% of its revenues to fraud each year and cumulative annual fraud loss globally during 2011 could have been of the order of more than $3.5 trillion. The amount involved in the frauds reported by the banking sector in India has more than quadrupled from Rs. 2038 crore during 2009-10 to Rs. 8646 crore during 2012-13. Similarly...
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...NON-PERFORMING ASSETSCHALLENGE TO THE PUBLIC SECTOR BANKS INTRODUCTION After liberalization the Indian banking sector developed very appreciate. The RBI also nationalized good amount of commercial banks for proving socio economic services to the people of the nation. The Public Sector Banks have shown very good performance as far as the financial operations are concerned. If we look to the glance of the financial operations, we may find that deposits of public to the Public Sector Banks have increased from 859,461.95crore to 1,079,393.81crore in 2003, the investments of the Public Sector Banks have increased from 349,107.81crore to 545,509.00crore, and however the advances have also been increased to 549,351.16crore from 414,989.36crore in 2003. The total income of the public sector banks have also shown good performance since the last few years and currently it is 128,464.40crore. The Public Sector Banks have also shown comparatively good result. The gross profits of the Public Sector Banks currently 29,715.26crore which has been doubled to the last to last year, and the net profit of the Public Sector Banks is 12,295,47crore. However, the only problem of the Public Sector Banks these days are the increasing level of the non performing assets. The non performing assets of the Public Sector Banks have been increasing regularly year by year. If we glance on the numbers of non performing assets we may come to know that in the year 1997 the NPAs were 47,300crore and reached to 80...
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...Michael Porter’s Five Forces Model Porter's five forces analysis is a framework for industry analysis and business strategy development formed by Michael E. Porter. It draws upon industrial organization (IO) economics to derive five forces that determine the competitive intensity and therefore attractiveness of a market. Attractiveness in this context refers to the overall industry profitability. An "unattractive" industry is one in which the combination of these five forces acts to drive down overall profitability. A very unattractive industry would be one approaching "pure competition", in which available profits for all firms are driven to normal profit. In case of Axis Bank, according to us, the Porter’s Five Forces Stands as shown below: | Weak | Neutral | Strong | Fierce | Industry Rivalry | | | | | Supplier Bargaining Power | | | | | Buyer Bargaining Power | | | | | Threat Of New Entrant | | | | | Threats of Substitute | | | | | Industry Rivalry Industry rivalry means the intensity of competition among the existing competitors in the market. Intensity of rivalry depends on the number of competitors and their capabilities. In case of Axis bank, we have found that this particular parameter is fierce. Since March 2002, Bankex (Index tracking the performance of leading banking sector stocks) has grown at a compounded annual rate of about 31% as shown below. After a very successful decade, a new era seems to have started...
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...reserves other than the cash with the Central Bank. The statutory liquidity ratio is a term most commonly used in India. The maximum and minimum limits for the SLR are 40% and 25% respectively in India CRR-Cash Reserve Ratio The reserve requirement (or cash reserve ratio) is a central bank regulation that sets the minimum reserves each commercial bank must hold (rather than lend out) of customer deposits and notes. It is normally in the form of cash stored physically in a bank vault (vault cash) or deposits made with a central bank. The CRR ratio in india is 6% Repo Rate Whenever the banks have any shortage of funds they can borrow it from RBI. Repo rate is the rate at which our banks borrow rupees from RBI. A reduction in the repo rate will help banks to get money at a cheaper rate. When the repo rate increases borrowing from RBI becomes more expensive. Current Repo Rate in India is 8.5% Reverse Repo Rate Reverse Repo rate is the rate at which Reserve Bank of...
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