ICICI Bank again has been fined by the Delhi Consumer Commission of Rs 10-lakh and this time for not issuing credit card to a lawyer for a "negative profile" profession.
But the bank denied the charge that it was not giving credit cards to advocates and said it will appeal against order before an appropriate forum.
The Commission has ordered the bank to deposit Rs 10 lakh in the State Consumer Welfare Fund, and pay Rs 50,000 as compensation to the complainant.
The Commission, presided over by Justice J D Kapoor in a strongly-worded order, restrained all other financial institutions from rejecting consumers' applications on the premise that their occupations fell under "negative profiles".
Condemning ICICI for not following the guidelines laid down by the Reserve Bank regarding financial credits, the Commission said that the lender could not be allowed to "defame and demean" any profession in general and the legal fraternity in particular.
After the order, an ICICI Bank spokesperson said in a statement that it has denied that it was not giving credit cards to advocates and submitted a list of advocates holding ICICI Bank Credit Cards.
"The bank would prefer an appeal before an appropriate forum. The bank had filed a reply taking a preliminary objection stating that the complainant is not a consumer of the bank, as provided for in the Consumer Protection Act," the spokesperson said.
"There is no service provided, therefore, the question of deficiency of service does not arise and the complainant does not fall within the purview of Consumer Protection Act," the bank added.
Saturday, February 9, 2008
Thursday, February 7, 2008
ICICI Bank penalized by Delhi Consumer Forum for issuing two outdated cheques
The ICICI Bank has been fined by the Delhi Consumer Forum for issuing two outdated cheques.
A fine of Rs 5,000 has been imposed on the ICICI Bank in Connaught Place, in Nov. 26 last year by the Consumer Dispute Redressal Forum in Sheikh Sarai, south Delhi. The representatives of the ICICI Bank had failed to appear before the Delhi consumer forum on two consecutive dates on a complaint from a consumer.
The bank issued two cheques of Rs 4,000 and Rs 1,000 Dec 12 with a validity of one month. But the cheques were submitted only on Jan 24 this year, 12 days after they had expired.
Taking serious note of the matter, on Tuesday the forum has decided to bring the matter to the notice of the Reserve Bank of India (RBI).
The forum has also passed orders to the manager of the Connaught Place branch to appear before it on the next hearing Feb 19 and explain why "out-dated" cheques were issued.
"It may be noted that if the bank manager does not appear on the next date, the forum shall take action against him," the order said.
A case has been filed before the forum by the complainant Sushil Kumari, who alleged that the bank sanctioned her loan for Rs 100,000 but was taking a monthly installment for Rs 150,000 loan. She had requested for Rs 150,000 loan, which the bank had refused. The bank later deposited Rs 40,917 in her account without informing her.
Kumari wanted the forum to direct ICICI Bank to deposit the remaining sum of Rs 9,000.
Last year in November last year, the bank had been fined by the Delhi Consumer Forum for employing goons for recovery of a Rs 550,000 loan and injuring a customer.
A fine of Rs 5,000 has been imposed on the ICICI Bank in Connaught Place, in Nov. 26 last year by the Consumer Dispute Redressal Forum in Sheikh Sarai, south Delhi. The representatives of the ICICI Bank had failed to appear before the Delhi consumer forum on two consecutive dates on a complaint from a consumer.
The bank issued two cheques of Rs 4,000 and Rs 1,000 Dec 12 with a validity of one month. But the cheques were submitted only on Jan 24 this year, 12 days after they had expired.
Taking serious note of the matter, on Tuesday the forum has decided to bring the matter to the notice of the Reserve Bank of India (RBI).
The forum has also passed orders to the manager of the Connaught Place branch to appear before it on the next hearing Feb 19 and explain why "out-dated" cheques were issued.
"It may be noted that if the bank manager does not appear on the next date, the forum shall take action against him," the order said.
A case has been filed before the forum by the complainant Sushil Kumari, who alleged that the bank sanctioned her loan for Rs 100,000 but was taking a monthly installment for Rs 150,000 loan. She had requested for Rs 150,000 loan, which the bank had refused. The bank later deposited Rs 40,917 in her account without informing her.
Kumari wanted the forum to direct ICICI Bank to deposit the remaining sum of Rs 9,000.
Last year in November last year, the bank had been fined by the Delhi Consumer Forum for employing goons for recovery of a Rs 550,000 loan and injuring a customer.
Tuesday, February 5, 2008
ICICI Bank stopped EFT other banks may follow suit
The Reserve Bank of India issued a circular dated January 8 on discontinuation of Electronic Funds Transfer (EFT) a possible misinterpretation of the circular, as a result ICICI bank asked its customers to switch over to other modes of payments.
In case you have given instructions to your bank for payments through Electronic Funds Transfer (EFT), it is better to check the status. From February 1, ICICI Bank has already stopped EFT and there could be other banks following suit.
A message to this effect on the bank’s portal created confusion among a large number of customers as sudden stoppage of payments could mean serious trouble.
“The RBI circular, addressed to all member banks of Brihan Mumbai bankers’ clearing house, says that the EFT system for transfer of funds to customers could be used up to January 31. “We acted on this,” an ICICI official told Business Line from Mumbai.
On the other hand, there is no clarity among the ICICI officials whether the RBI’s directive is applicable to non-Mumbai centers also. The directive issued by the bank also did not indicate withdrawal of EFT from February 1 in categorical terms.
When contacted the second largest private sector bank HDFC Bank official in Mumbai denied receiving any circular on EFT. The official explained a sudden stoppage of EFT will cause problem to a customer as some banks are still not part of National Electronic Funds Transfer (NEFT), though RBI wants to promote it in place of EFT.
Whereas RBI spokesperson said EFT is “very much in use.”
In case you have given instructions to your bank for payments through Electronic Funds Transfer (EFT), it is better to check the status. From February 1, ICICI Bank has already stopped EFT and there could be other banks following suit.
A message to this effect on the bank’s portal created confusion among a large number of customers as sudden stoppage of payments could mean serious trouble.
“The RBI circular, addressed to all member banks of Brihan Mumbai bankers’ clearing house, says that the EFT system for transfer of funds to customers could be used up to January 31. “We acted on this,” an ICICI official told Business Line from Mumbai.
On the other hand, there is no clarity among the ICICI officials whether the RBI’s directive is applicable to non-Mumbai centers also. The directive issued by the bank also did not indicate withdrawal of EFT from February 1 in categorical terms.
When contacted the second largest private sector bank HDFC Bank official in Mumbai denied receiving any circular on EFT. The official explained a sudden stoppage of EFT will cause problem to a customer as some banks are still not part of National Electronic Funds Transfer (NEFT), though RBI wants to promote it in place of EFT.
Whereas RBI spokesperson said EFT is “very much in use.”
ICICI bank to keep low risk priority lending and gives big financing to HFC
ICICI Bank, the country’s second largest mortgage lender, is making plan to split its home loan business between the bank and its wholly owned subsidiary, ICICI Home Finance Company.
According to the plan the bank will be financing home loans only up to Rs 20 lakh, which qualify as priority sector lending. Home loans above Rs 20 lakh will be offered by ICICI Home Finance.
“ICICI Bank will focus on home loans with a ticket size of Rs 20 lakh, which qualifies as priority sector loans. The bank will keep the priority sector loan business with itself. Large ticket-size loans will be booked by ICICI Home Finance,’’ said Rajiv Sabharwal, senior general manager, ICICI Bank.
Housing loans up to Rs 20 lakh have a lower risk weight of 50 % for capital allocation purpose. Banks have to direct 40 % of their loans towards priority sector, including agriculture and small-scale industries. While larger ticket-size loans carry a higher risk weight of 75 %.
Recently RBI has approved banks home finance company. Following this, the bank has invested Rs 500 crore in the company, taking the net worth of the company to Rs 800 crore at the end of December 2007.
ICICI Bank private sector bank is moving ahead of creating a separate subsidiary for home finance, while public sector banks such as State Bank of India, Canara Bank and Punjab National Bank are considering merging their subsidiaries with themselves.
The biggest challenge for banks is to raise long-term finance. The home finance company will have search different sources of capital, which can be diversified and long term in nature. The home finance company will also be setting up branches in convenient locations, said Sabharwal.
The average home loan ticket size is around Rs 10 lakh. While Housing loans up to Rs 20 lakh form about 60 % of the banks’ mortgage portfolio.
At the end of March 31,2007 the total assets of the housing finance company stood at Rs 4,610.78 crore. In the third quarter of 2007-08, the home finance company gave out less than Rs 1,000 crore of home loans.
At the end of December 2007 ICICI Bank’s home loan volume grew by 12 % year-on-year to around Rs 60,000 crore. If the payment done at the end of the quarter in the home finance company were to be included, the growth in the home loan portfolio would be around 13-14 %.
This is a deceleration from the eminent levels of 40 % year-on-year growth which the bank had accounted in its mortgage lending portfolio in the previous year.
Housing finance companies are required to maintain a capital adequacy ratio of 12 %. Moreover, while banks have to keep aside Rs 32.5 of every Rs 100 raised to meet cash reserve ratio and statutory liquidity ratio requirements, while non-deposit taking housing finance companies are not subject to these requirements.
RBI has setup the National Housing Bank to keep check on Housing finance companies. Banks have the right to issue infrastructure bonds to raise long-term resources; while HFCs can increase long-term funds through issue of bonds and debentures.
HFCs do not require obtaining licenses for opening of new branches or office. They only have to inform the NHB of their intention to open a new branch or office.
In May 1999 ICICI Home Finance Company was included as a 100 % subsidiary of ICICI Personal Financial Services, the bank’s one-time consumer banking arm. Since May 2002, ICICI Home Finance has become a fully possessed subsidiary of ICICI Bank.
The bank is charging 12 % interest for home loans above Rs 20 lakh, which is 50 basis points higher than the interest on home loans up to Rs 20 lakh.
According to the plan the bank will be financing home loans only up to Rs 20 lakh, which qualify as priority sector lending. Home loans above Rs 20 lakh will be offered by ICICI Home Finance.
“ICICI Bank will focus on home loans with a ticket size of Rs 20 lakh, which qualifies as priority sector loans. The bank will keep the priority sector loan business with itself. Large ticket-size loans will be booked by ICICI Home Finance,’’ said Rajiv Sabharwal, senior general manager, ICICI Bank.
Housing loans up to Rs 20 lakh have a lower risk weight of 50 % for capital allocation purpose. Banks have to direct 40 % of their loans towards priority sector, including agriculture and small-scale industries. While larger ticket-size loans carry a higher risk weight of 75 %.
Recently RBI has approved banks home finance company. Following this, the bank has invested Rs 500 crore in the company, taking the net worth of the company to Rs 800 crore at the end of December 2007.
ICICI Bank private sector bank is moving ahead of creating a separate subsidiary for home finance, while public sector banks such as State Bank of India, Canara Bank and Punjab National Bank are considering merging their subsidiaries with themselves.
The biggest challenge for banks is to raise long-term finance. The home finance company will have search different sources of capital, which can be diversified and long term in nature. The home finance company will also be setting up branches in convenient locations, said Sabharwal.
The average home loan ticket size is around Rs 10 lakh. While Housing loans up to Rs 20 lakh form about 60 % of the banks’ mortgage portfolio.
At the end of March 31,2007 the total assets of the housing finance company stood at Rs 4,610.78 crore. In the third quarter of 2007-08, the home finance company gave out less than Rs 1,000 crore of home loans.
At the end of December 2007 ICICI Bank’s home loan volume grew by 12 % year-on-year to around Rs 60,000 crore. If the payment done at the end of the quarter in the home finance company were to be included, the growth in the home loan portfolio would be around 13-14 %.
This is a deceleration from the eminent levels of 40 % year-on-year growth which the bank had accounted in its mortgage lending portfolio in the previous year.
Housing finance companies are required to maintain a capital adequacy ratio of 12 %. Moreover, while banks have to keep aside Rs 32.5 of every Rs 100 raised to meet cash reserve ratio and statutory liquidity ratio requirements, while non-deposit taking housing finance companies are not subject to these requirements.
RBI has setup the National Housing Bank to keep check on Housing finance companies. Banks have the right to issue infrastructure bonds to raise long-term resources; while HFCs can increase long-term funds through issue of bonds and debentures.
HFCs do not require obtaining licenses for opening of new branches or office. They only have to inform the NHB of their intention to open a new branch or office.
In May 1999 ICICI Home Finance Company was included as a 100 % subsidiary of ICICI Personal Financial Services, the bank’s one-time consumer banking arm. Since May 2002, ICICI Home Finance has become a fully possessed subsidiary of ICICI Bank.
The bank is charging 12 % interest for home loans above Rs 20 lakh, which is 50 basis points higher than the interest on home loans up to Rs 20 lakh.
Monday, February 4, 2008
ICICI bank to start Industry-Academia Partnership Program in West Bengal Universities
ICICI bank has started an Industry-Academia Partnership Program in which it will provide banking and insurance courses in the university. The bank is in discussion with three leading universities of the West Bengal to launch banking and insurance courses.
Speaking on the sidelines of a seminar on entrepreneurship development in Kolkata on Friday, K V Kamath, managing director and CEO, ICICI Bank said while the proposal to start the course with Calcutta University had been more or less finalized, the dialogue was on with Burdwan University.
The bank is also having discussions with Jadavpur University to start similar courses.
Under its partnership program, the bank has tied-up with various universities across the country for industry-specific banking and insurance courses. The bank had already launched such courses with Manipal University and the Delhi University among others.
Kamath speaking at the seminar said, West Bengal had chosen the path of growth.
Few years ago, West Bengal had led India in the agriculture front, and now in the coming years, it would challenge the IT industries of other states advanced in the sector.
Speaking on the sidelines of a seminar on entrepreneurship development in Kolkata on Friday, K V Kamath, managing director and CEO, ICICI Bank said while the proposal to start the course with Calcutta University had been more or less finalized, the dialogue was on with Burdwan University.
The bank is also having discussions with Jadavpur University to start similar courses.
Under its partnership program, the bank has tied-up with various universities across the country for industry-specific banking and insurance courses. The bank had already launched such courses with Manipal University and the Delhi University among others.
Kamath speaking at the seminar said, West Bengal had chosen the path of growth.
Few years ago, West Bengal had led India in the agriculture front, and now in the coming years, it would challenge the IT industries of other states advanced in the sector.
Monday, January 21, 2008
ICICI bank to increase operations globally and domestically through organic route
The biggest private sector lender ICICI Bank has plans to increase its operations globally and domestically including through organic route. The bank said that India’s banking space needs a major consolidation wave of mergers and acquisitions.
"The earlier the consolidation happens, better it would be, because of the scale build up and rationalization of technology and skill set it would give to the public sector banks," ICICI Bank's Managing Director and CEO K V Kamath told in an interview.
Kamath said, ICICI bank on its own part is looking to spread out its operations in domestic and overseas markets including through organic route and by increasing its presence in the existing markets.
"We are now in 18 countries and 22-23 per cent of our balance sheet is global assets. The intent is to further scale up our existing overseas operation than expanding the footprint," he noted.
"To go into another territory and build a grass-root business and competing with entrenched local players is not easy. That would be true of any country including the West where the scale is there."
On the question whether the fast-growing economy China was on its radar, Kamath said, "I can categorically say no. For me to assume that I can go into China and do business is not easy."
ICICI bank is the country’s most valued bank and is currently in process of unlocking value in at least six other subsidiaries starting with brokerage arm, the chief of ICICI Bank, ICICI Securities said their current strategy is to grow the business organically.
On Saturday the bank’s board approved a proposal to dilute the stake in I-Sec through an IPO as well as a pre-IPO private placement.
"The earlier the consolidation happens, better it would be, because of the scale build up and rationalization of technology and skill set it would give to the public sector banks," ICICI Bank's Managing Director and CEO K V Kamath told in an interview.
Kamath said, ICICI bank on its own part is looking to spread out its operations in domestic and overseas markets including through organic route and by increasing its presence in the existing markets.
"We are now in 18 countries and 22-23 per cent of our balance sheet is global assets. The intent is to further scale up our existing overseas operation than expanding the footprint," he noted.
"To go into another territory and build a grass-root business and competing with entrenched local players is not easy. That would be true of any country including the West where the scale is there."
On the question whether the fast-growing economy China was on its radar, Kamath said, "I can categorically say no. For me to assume that I can go into China and do business is not easy."
ICICI bank is the country’s most valued bank and is currently in process of unlocking value in at least six other subsidiaries starting with brokerage arm, the chief of ICICI Bank, ICICI Securities said their current strategy is to grow the business organically.
On Saturday the bank’s board approved a proposal to dilute the stake in I-Sec through an IPO as well as a pre-IPO private placement.
Friday, January 18, 2008
ICICI bank aim to be at the top in Sri Lanka
The ICICI bank, which is the largest private bank in India, is working to become the top foreign bank in Sri Lanka. The bank is the third biggest foreign bank in Sri Lanka. Prem Kumar Thampi, ICICI Sri Lanka country chief told the press in the next four to five years in the country the Bank is targeting a balance sheet of over $1 billion.
“We started our bank in Sri Lanka with $25 million and today we are the third biggest in the Island country with $280 million,” Thampi said.
ICICI, as part of its expansion plans, is also working with the Securities and Exchange Commission.
“This year, other than branch expansion work, we are working with the Central Bank to introduce a Commodity Exchange Centre for commodities,” Thampi said.
The bank has started several schemes to attract more customers in the island country. The bank is giving a special offer of sanctioning loans within two days and the offer of early settlement of loans with a 100% interest rebate and minimal foreclosure charges.
ICICI bank is positioned at the second amongst the Indian bank sector and is the largest private sector bank with over 50 years of presence in financial services and with assets of Rs3,649.44 billion (about $92.16 billion) as on September 30, 2007.
“We started our bank in Sri Lanka with $25 million and today we are the third biggest in the Island country with $280 million,” Thampi said.
ICICI, as part of its expansion plans, is also working with the Securities and Exchange Commission.
“This year, other than branch expansion work, we are working with the Central Bank to introduce a Commodity Exchange Centre for commodities,” Thampi said.
The bank has started several schemes to attract more customers in the island country. The bank is giving a special offer of sanctioning loans within two days and the offer of early settlement of loans with a 100% interest rebate and minimal foreclosure charges.
ICICI bank is positioned at the second amongst the Indian bank sector and is the largest private sector bank with over 50 years of presence in financial services and with assets of Rs3,649.44 billion (about $92.16 billion) as on September 30, 2007.
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