NIA tightens noose on those involved in J&K terror funding

Newsroom24x7 Network

New Delhi/Srinagar: Searches conducted at 27 locations in Delhi and Srinagar by NIA teams in connection with the J&K Terror Funding/LOC Trade cases last week (6 September onwards) have led to seizure of diaries pertaining to contacts of hawala operators/traders, ledger books containing accounts of cross border LOC trade of various trading companies. Details of dubious bank accounts of Jammu and Kashmir also have been recovered.

The places searched by the NIA include houses and business establishments of traders and hawala operators who are suspected of channelising funds to fuel secessionist and anti-India activities.

During the searches, cash amounting to approximately Rs. 2.20 Crores has been recovered besides incriminating documents pertaining to financial transactions. Digital devices, including laptops, mobile phones and hard discs have also been seized during the search.

Travel documents of some persons showing their visits to the UAE and their alleged links with those in the Pakistani ISI have also been recovered.

Investigations are continuing and the suspects are being questioned about the incriminating recoveries made from them.

CBI arrests one more person in VYAPAM case

Newsroom24x7  Staff

New Delhi: The Central Bureau of Investigation has arrested a middleman allegedly involved in 6 cases of Vyapam (Madhya Pradcesh Professional Examination Board) connected with Forest Guard Recruitment Test-2013, Food and Measurement Recruitment Test-2012, PMT-2012, PMT-2013, Police Constable Recruitment Test-2012 & MP Dairy Federation Co-operative Ltd. Recruitment Test-2013.

The said accused was allegedly figuring as middleman in 6 cases relating to illegal selection of candidates through manipulation of OMR answer sheets/results in conspiracy with certain Vyapam officials and others.

The arrested person was absconding since the cases were being investigated by the Special Task Force of Madhya Pradesh Police. He allegedly arranged various candidates/scorers for illegal selection through examinations conducted by Vyapam for racketeers who got the candidates selected in connivance with Vyapam officials through manipulation of result/OMR Answer Sheets/Roll Numbers.

The Special Judge, CBI, Bhopal had issued an arrest warrant for the accused, who remained absconding during investigation by he STF and CBI.

CBI took over the investigation of cases relating to Vyapam on Supreme court orders issued on 9 July 2015 in case no- WP (Civil) 417/2015.

Services of IAS officer Shashi Karnawat terminated

Newsroom24x7 Network

Bhopal: Services of promotee 1999 batch Indian Administrative Service Officer Ms. Shashi Karnawat, who was borne on the Madhya Pradesh cadre have been terminated.

Karnawat has been terminated from the services under the All India Service (Discipline and Appeal) Rule 1969. Her termination order issued by the Government of India is in agreement with the advice of the Union Public Service Commission.

A case was registered against Karnawat in connection with a loss of around Rs. 33 lakhs caused to the state government and alleged illegal profiteering in printing of forms by the State Economic Offenses Investigation Bureau in the year 1999-2000.

Karnawat was sentenced 5 years rigorous imprisonment under section 13 (1) d and Section 13 (2) of the Prevention of Corruption Act 1988 and the penalty of Rs 40 lakh an, under section 420 and 34 of the Indian Penal Code 5 years of rigorous imprisonment and 5 lakh rupees fine and Section 120 ‘B’ of Indian Penal Code, 5 years of rigorous imprisonment and 5 lakh rupees was penalized In September 2013 by the Special Court Mandla in September 2013.After her imprisonment in Mandla jail, suspension orders were issued to Karnawat in October 2013.

Karnawat was issued a Show Cause Notice in October 2014 on suspension from service under All India Services (Discipline and Appeal). Despite being given sufficient opportunity, she failed to give a final and complete reply to the notice. Hence, the proposal to dismiss her from the service was sent to the Government of India by the State Government.

The termination order has been served to Karnawat.

Indian banks face USD65 billion capital shortage by FYE19

Newsroom24x7 Network

Mumbai/Singapore: Indian banks are likely to require around USD65 billion of additional capital to meet new Basel III capital standards that will be fully implemented by the financial year ending March 2019 (FY19), according to Fitch Ratings’ latest estimates.

According to Fitch, weak capital positions have a major negative influence on Indian banks’ Viability Ratings, which will come under more pressure if the problem is not addressed.

Capital needs have fallen from our previous estimate of USD90 billion, largely as a result of asset rationalisation and weaker-than-expected loan growth. Even so, state banks – which account for 95% of the estimated shortage – have limited options to raise the capital they still require. Prospects for internal capital generation are weak and low investor confidence impedes access to the equity capital market. Access to the Additional Tier 1 (AT1) capital market has improved in recent months – reflecting state support to help state banks avoid missing coupon payments – but around two-thirds of the capital shortage is in the form of common equity Tier 1 (CET1).

State banks are likely to be dependent on the state to meet core capital requirements. The government is committed to investing only another USD3 billion in fresh equity for 21 state banks over FY18 and FY19, having already provided most of the originally budgeted USD11 billion. Fitch believes the government will have to pump in more than double, even on a bare minimum basis (excluding buffers), if it is to raise loan growth, address weak provision cover, and aid in effective NPL resolution – the gross NPL ratio reached 9.7% in FY17, up from 7.8% in FY16.

The NPL resolution process being led by the Reserve Bank of India (RBI) could potentially release capital if recovery rates are as high as banks and the government are hoping for. There are 12 currently going through resolution, representing 25% of total system NPLs, and the RBI has recently released a list of 50 more accounts that banks have been directed to resolve within three months or push into the insolvency process.

Most banks do not expect haircuts to exceed 60%. However, those loss assumptions may look optimistic considering the first resolution of corporate debt under the government’s new insolvency code produced a recovery rate of just 6%. Banks argue this cannot be extrapolated to the other exposures, which they say are backed by more productive assets. Nevertheless, average provision cover of 40%-50% is quite low considering that the accounts in question have been NPLs for two or more years and are financially stretched. Lower-than-expected recoveries are likely to put earnings at risk, and capital could be further undermined as a result.

State banks are unlikely to be freed from their current gridlock unless NPL resolution is accompanied by additional capital. They have already lost around 300bp in market share to private banks since FY12 as government capital injections have not been sufficient to support growth. Indeed, poor performance has led to a decline in the total CET1 capital of state banks over the last year, despite the injections. Indian banks’ loan growth slumped to 4.4% in FY17 – the lowest in several decades – and it is unlikely that state banks will grow at all in the foreseeable future given their capital constraints. Many state banks, particularly smaller ones, will struggle to survive as individual banks, and could be swept up into the government’s consolidation agenda.