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Jaitley was told of Urjit Patel’s decision to quit only minutes in advance

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New Delhi : Monday was supposed to be a good day for the government. It announced the Cabinet’s decision to raise the Centre’s contribution to the National Pension Scheme for its employees, and was expecting the UK’s decision on extradition of fugitive liquor baron Vijay Mallya. But things changed after 5 pm when Reserve Bank of India Governor Urjit Patel’s resignation hit the RBI website.

Highly-placed sources in the government say that none of the senior ministers had any inkling of Patel’s resignation. Even Finance Minister Arun Jaitley came to know about it minutes before Patel quit.

The government will soon form a panel to search for a new RBI governor, an official said. RBI’s deputy governors, former government officials and top bankers and economists could be considered.

 

“The government acknowledges with deep sense of appreciation the services rendered by Dr Urjit Patel to this country both in his capacity as the Governor and the Deputy Governor of The RBI. It was a pleasure for me to deal with him and benefit from his scholarship. I wish Dr Patel all the very best and many more years of public service,” Jaitley tweeted, around an hour after Patel quit. Moments later, Prime Minister Narendra Modi tweeted.

While Patel cited ‘personal reasons’ for his exit, former officials who’ve worked alongside him and current officials involved with the events of the past few months acknowledge that the reasons were different.

“He did not thank the government in his statement, did he?” asked an official, when contacted by Business Standard. “We all know what has been happening in the past few months.”

Sources in the government say the resignation is all the more surprising after the last board meeting, which was a cordial affair by all accounts, and a resolution was reached on two contentious issues.

The central bank decided to refer the issue of RBI’s excess capital to a committee. The constituents of the committee and its terms of reference are still being discussed by the government and the RBI. The RBI also referred its prompt corrective action norms to its Board of Financial Supervision. The next Board Meeting is scheduled for December 14.

“It is sad and unfortunate,” said a former secretary to the government, who did not wish to be named as he still works with the government in another capacity. “I thought they could resolve their differences. (Former RBI governor) Raghuram Rajan had informed the Prime Minister and the Finance Minister that he will not seek an extension, as per convention. It is one thing to feel uncomfortable with an individual, and have a conflict with him. It is another to have him been pressured through the RBI board which has all your nominees. He must have felt that this creates a perpetual state of conflict and hence his position becomes untenable.”


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Business

MPC to meet six times during 2019-20: RBI

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Mumbai: The Monetary Policy Committee (MPC), which decides on key interest rates, will meet six times during the next financial year, the Reserve Bank of India (RBI) said.

The first meeting of the six-member MPC to decide on the first bi-monthly monetary policy statement for 2019-20 will be held from April 2 to 4.

The policy will be announced on April 4. Headed by RBI Governor Shaktikanta Das, the committee also includes two representatives from the central bank and three external members.

 

The external members are Indian Statistical Institute professor Chetan Ghate, Delhi School of Economics Director Pami Dua and Indian Institute of Management-Ahmedabad professor Ravindra H Dholakia.

According to the schedule provided by the RBI, the second meeting of the MPC in the next fiscal will be held on June 3, 4 and 6; third meeting (August 5-7); fourth meeting (October 1, 3 and 4); fifth meeting (December 3-5) and sixth meeting (February 4-6, 2020).

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SBI raises Rs 1,251 crore by issuing Basel III-compliant bonds

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New Delhi: The country’s largest lender State Bank of India (SBI) said it has raised Rs 1,251.30 crore by issuing Basel III-compliant bonds.

“The Committee of Directors for Capital Raising at its meeting held today on 22 March 2019 deliberated and accorded approval to allot 12,513 non-convertible, taxable, perpetual, subordinated, unsecured Basel lll-compliant additional tier-I bonds, for inclusion in additional tier-I capital of the bank…aggregating to Rs 1,251.30 crore,” SBI said in a regulatory filing.

The bonds with a face value of Rs 10 lakh each bears a coupon rate of 9.45 per cent per anum payable annually with call option after 5 years or any anniversary date thereafter, it said. The bonds were subscribed on Friday, it added.

 

State Bank of India (SBI) also said the central board of the bank at its meeting held has accorded its approval for extension of validity period for raising equity capital of up to Rs 20,000 crore from market by way of follow-on public offer, qualified institutional placement, preferential allotment, rights issue or any other mode or a combination of these till March 31, 2020.

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Sebi fines 4 entities Rs 27 lakh for fraudulent trading in BSE stock options

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New Delhi: Markets regulator Sebi imposed a total penalty of Rs 27 lakh on four entities for indulging in fraudulent trade in illiquid stock options segment of BSE.

Umapati Oil Mill and Ginning Factory, Yudhbir Chhibbar, Kasturbhai Mayabhai Pvt Ltd and Vimladevi Shyamsunder Khetan are the four entities, according to Sebi’s separate orders.

fter observing a large-scale reversal of trades in the BSE’s illiquid stock options segment, Sebi conducted a probe from April 2014 to September 2015.

 

Following the probe, the regulator found that the trades executed by the entities were not genuine as they were reversed within few seconds with same counter parties with significant difference in price, resulting in profit to the entities.

Securities and Exchange Board of India (Sebi) said it was a deliberate attempt to deal in such a fashion and not a mere coincidence.

The trades executed by the entities were not genuine and created an appearance of artificial trading volumes, thereby violating PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) regulations, Sebi noted.

Accordingly, a fine of Rs 8.7 lakh and Rs 8.4 lakh were imposed on Yudhbir Chhibbar and Vimladevi, respectively while a penalty of Rs 5 lakh each was levied on Umapati Oil Mill and Kasturbhai Mayabhai Pvt Ltd, totalling Rs 27.1 lakh.

In a separate order, Sebi imposed a total fine of Rs 6 lakh on four promoters of Artech Power Products for delayed disclosures to exchanges regarding their change in the shareholding in the company.

Ranjith Vijayan, I V Vijayan, Repsy Vijayan and Resmi Vijayan are the four promoters, according to Sebi’s order.

The promoters have deprived the vital information to the public by non-disclosure /delayed disclosure as mandated by the Takeover Regulations, Sebi noted.

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