Sashidhar Jagdishan’s selection as MD and CEO of HDFC Bank Ltd. for another three years was recently confirmed by the Reserve Bank of India, the Mumbai-based lender announced on Tuesday.
“RBI vide its communication dated September 18, 2023, has approved the re-appointment of Mr. Sashidhar Jagdishan as the Managing Director and Chief Executive Officer of the Bank for a period of 3 (three) years w.e.f. October 27, 2023 to October 26, 2026,” said HDFC Bank in a stock exchange filing.
Sashidhar Jagdishan has an overall banking experience of over 31 years. Jagdishan has completed his graduation in Science with specialisation in Physics, is a Chartered Accountant by profession and holds a Master’s degree in Economics of Money, Banking & Finance from the University of Sheffield, United Kingdom. He joined HDFC Bank in 1996 as a Manager in the Finance function. He became Business Head – Finance in 1999 and was appointed as Chief Financial Officer in 2008.
“He (Jagdishan) played a critical role in supporting the growth trajectory of the Bank, and led the finance function with a pivotal role in aligning the organisation in achieving the strategic objectives over the years. Prior to his appointment as Managing Director & Chief Executive Officer of the Bank, he was the Group Head of the Bank in addition to overseeing the functions of Finance, Human Resources, Legal & Secretarial, Administration, Infrastructure, Corporate Communications and Corporate Social Responsibility,” said HDFC Bank in a stock exchange filing. Jagdishan is not debarred from holding office of director by virtue of any SEBI order or any other such authority. He is not related to any director or Key Managerial Personnel of the Bank.
The Government of India (GoI) has announced the sale (re-issue) of (i) “7.06% Government Security 2028” for a notified amount of ₹8,000 crore (nominal) through price based auction using uniform price method, (ii) “7.18% Government Security 2033” for a notified amount of ₹14,000 crore (nominal) through price based auction using uniform price method and (iii) “7.30% Government Security 2053” for a notified amount of ₹11,000 crore (nominal) through price based auction using multiple price method. GoI will have the option to retain additional subscription up to Rs. 2,000 crore against each security mentioned above. The auctions will be conducted by the Reserve Bank of India, Mumbai Office, Fort, Mumbai on September 08, 2023 (Friday).
Up to 5% of the notified amount of the sale of the securities will be allotted to eligible individuals and institutions as per the Scheme for Non-Competitive Bidding Facility in the Auction of Government Securities.
Both competitive and non-competitive bids for the auction should be submitted in electronic format on the Reserve Bank of India Core Banking Solution E-Kuber system on September 08, 2023. The non-competitive bids should be submitted between 10:30 a.m. and 11:00 a.m. and the competitive bids should be submitted between 10:30 a.m. and 11:30 a.m.
The result of the auctions will be announced on September 08, 2023 (Friday) and payment by successful bidders will be on September 11, 2023 (Monday).
The Securities will be eligible for “When Issued” trading in accordance with the guidelines on ‘When Issued transactions in Central Government Securities’ issued by the Reserve Bank of India vide circular No. RBI/2018-19/25 dated July 24, 2018 as amended from time to time.
Mr. P R Seshadri is an accomplished banker with experiences spanning multiple businesses, functional lines and geographies. He has significant experiences in enterprise level management and in the management of all key commercial banking business lines and he has substantial experience in successfully managing investors, boards and regulatory relationships in multiple geographies. Mr. P R Seshadri is a respected business leader with a proven track record of building and leading large teams to execute and deliver complex business objectives. He demonstrated his ability in creating new businesses as well as in problem solving. He is successful in scaling businesses – both existing and new – taking advantage of new technologies and new market opportunities.
He holds Bachelor’s degree in Electrical Engineering from the Delhi College of Engineering and a Post Graduate Diploma in Management from Indian Institute of Management, Bangalore.
Mr. P R Seshadri has served as, amongst other positions as, Managing Director & CEO of The Karur Vysya Bank Limited (KVB), Managing Director & Regional Sales and Distribution Head, Citibank N.A., Asia Pacific, Singapore, Managing Director & Regional Head of Lending, Businesses, Citibank N.A., Asia Pacific, Singapore, Managing Director CitiFinancial Consumer Finance India Limited (CCFIL), India, Marketing Director, Citibank N.A, India Branches, Head of Structured Finance & Managing Director, CFRSIL & Integration Manager – Associates India Limited, Head of Banking Collections, Citibank N.A, India, Head of Automobile Finance -Northern India, Head of Community Banking, Northern India, and Mortgage Business, Head – Southern India, Citi India.
He is currently mentoring businesses both at an operating level as well as at the Board level at various companies.
Mr. Murali Ramakrishnan, MD & CEO of South Indian Bank commented on latest RBI’s monetary policy by mentioning, “RBI’s MPC’s measures over the last few quarters have been effective in maintaining a tight leash on headline inflation while facilitating economic growth. The Indian economy has responded by staying resilient in the face of heightened geo-political uncertainties and a volatile international demand-supply equation. To sustain the momentum, the MPC has, for the third successive quarter, rightly maintained status quo in the policy rates. We concur with it and the retention of the ‘Withdrawal of Accommodation’ stance. Similarly, repo rate unchanged will further ensure that inflation progressively aligns with the target, while supporting growth.”
RBI is closely watching the evolving space of Fintech. Innovations are happening across three elements: time, access and data. New innovations are helping in driving down costs, refocusing products and services and improving customer reach and services. There are no Fintech regulations right now. We are talking to the industry and understanding whether there is a need to regulate them. Can’t give a timeline at the moment. But it will come only after consultation with them,” he added.
“We at RBI need to understand how Fintechs are evolving and innovators are thinking. But the young innovators’ focus is on innovations and not as much on regulations yet and we need to find that balance. We time our intervention so that the industry (Fintech) is allowed to grow,” he said.
Speaking on cryptocurrencies, RBI’s Deputy Governor said, “People trading crypto is not the concern but the unbacked cryptocurrencies and the product itself alongside its backers is the problem.”
He also highlighted that stablecoins pegged to other currencies in emerging market economies pose several threats.
“Stablecoins pegged to currencies, for example USD are not a risk to the USA. But stable currencies pegged to other currencies in emerging market economies (EMEs) pose very serious financial stability, capital management, and monetary policy risks,” Shankar said.
Here is a complete official statement from reserve bank of India (RBI) on JUne 2023’s Monetary Policy Meeting. On the basis of an assessment of the current and evolving macroeconomic situation, the Monetary Policy Committee (MPC) at its meeting decided to:
Keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 6.50 per cent.
The standing deposit facility (SDF) rate remains unchanged at 6.25 per cent and the marginal standing facility (MSF) rate and the Bank Rate at 6.75 per cent.
The MPC also decided to remain focused on withdrawal of accommodation to ensure that inflation progressively aligns with the target, while supporting growth.
These decisions are in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4 per cent within a band of +/- 2 per cent, while supporting growth.
The main considerations underlying the decision are set out in the statement below.
Assessment
Global Economy
2. In the second quarter of 2023, the global economy is sustaining the momentum gained in the preceding quarter in spite of still elevated though moderating inflation, tighter financial conditions, banking sector stress, and lingering geopolitical conflicts. Sovereign bond yields are trading sideways on expectations of the imminent peaking of the tightening cycle of monetary policy while the US dollar has appreciated. Equity markets have remained range bound since the last MPC meeting. For several emerging market economies (EMEs), weak external demand, elevated debt levels and geoeconomic disintegration amidst tighter external financial conditions pose risks to growth prospects, although capital flows are cautiously returning to them on renewed risk appetite.
Domestic Economy
3. According to the provisional estimates released by the National Statistical Office (NSO) on May 31, 2023, India’s real gross domestic product (GDP) growth accelerated from 4.5 per cent (year-on-year, y-o-y) in Q3:2022-23 to 6.1 per cent in Q4, supported by fixed investment and higher net exports. Real GDP growth for 2022-23 was placed at 7.2 per cent, higher than the second advance estimate of 7.0 per cent.
4. Domestic economic activity remains resilient in Q1:2023-24 as reflected in high frequency indicators. Purchasing managers’ indices (PMI) for manufacturing and services indicated sustained expansion, with the manufacturing PMI at a 31-month high in May and services PMI at a 13-year high in April-May. In the services sector, domestic air passenger traffic, e-way bills, toll collections and diesel consumption exhibited buoyancy in April-May, while railway freight and port traffic registered modest growth.
5. On the demand side, urban spending remains robust as reflected in indicators such as passenger vehicle sales and domestic air passenger traffic which recorded double digit growth in April. Rural demand is gradually improving though unevenly – motorcycle sales expanded in April, while tractor sales contracted partly owing to unseasonal rains. Investment activity is picking up as reflected in the healthy expansion in steel consumption and cement output in April. Merchandise exports and non-oil non-gold imports remained in contraction mode in April while services exports sustained a robust expansion.
6. CPI inflation fell sharply to 4.7 per cent in April 2023 from 6.4 per cent in February on the back of large favourable base effects, with softening observed across all the three major groups. Food group inflation eased, with moderation in cereals, eggs, milk, fruits, meat and fish, spices and prepared meals inflation and deepening of deflation in edible oils. In the fuel group, inflation in LPG and firewood and chips prices fell and kerosene prices slipped into deflation. Core inflation (i.e., CPI inflation excluding food and fuel) dipped, driven down by clothing and footwear, household goods and services, health, transport and communication, personal care and effects and recreation and amusement sub-groups.
7. The average daily absorption under the LAF increased to ₹1.7 lakh crore during April-May from ₹1.4 lakh crore in February-March. Money supply (M3) expanded by 10.1 per cent y-o-y and non-food bank credit by 15.6 per cent as on May 19, 2023. India’s foreign exchange reserves were placed at US$ 595.1 billion as on June 2, 2023.
Outlook
8. Going forward, the headline inflation trajectory is likely to be shaped by food price dynamics. Wheat prices could see some correction on robust mandi arrivals and procurement. Milk prices, on the other hand, are likely to remain under pressure due to supply shortfalls and high fodder costs. The forecast of a normal south-west monsoon by the India Meteorological Department (IMD) augurs well for kharif crops; however, the spatial and temporal distribution of the monsoon would need to be closely monitored to assess the prospects for agricultural production. Crude oil prices have eased but the outlook remains uncertain. According to the early results from the Reserve Bank’s surveys, manufacturing, services and infrastructure firms polled expect input costs and output prices to harden. A clearer picture will emerge when the final survey results are available. Taking into account these factors and assuming a normal monsoon, CPI inflation is projected at 5.1 per cent for 2023-24, with Q1 at 4.6 per cent, Q2 at 5.2 per cent, Q3 at 5.4 per cent and Q4 at 5.2 per cent. The risks are evenly balanced (Chart 1).
9. The higher rabi crop production in 2022-23, the expected normal monsoon, and the sustained buoyancy in services should support private consumption and overall economic activity in the current year. The government’s thrust on capital expenditure, moderation in commodity prices and robust credit growth are expected to nurture investment activity. Weak external demand, geoeconomic fragmentation, and protracted geopolitical tensions, however, pose risks to the outlook. Taking all these factors into consideration, real GDP growth for 2023-24 is projected at 6.5 per cent with Q1 at 8.0 per cent, Q2 at 6.5 per cent, Q3 at 6.0 per cent, and Q4 at 5.7 per cent, with risks evenly balanced (Chart 2).
10. The MPC took note of the moderation in CPI headline inflation in March-April into the tolerance band, in line with projections, reflecting the combined impact of monetary tightening and supply augmenting measures. Headline inflation is projected to decline in 2023-24 from its level in 2022-23 but would still be above the target, warranting continuous vigil. The progress of the south west monsoon is critical in this regard. Domestic economic activity is holding up well. Consumer confidence is improving and businesses remain optimistic about the future. The cumulative rate hike of 250 basis points undertaken by the MPC is transmitting through the economy and its fuller impact should keep inflationary pressures contained in the coming months. Monetary policy would need to be carefully calibrated for alignment of inflation with the target. Against this backdrop, the MPC decided to keep the policy repo rate unchanged at 6.50 per cent. The MPC resolved to continue keeping a close vigil on the evolving inflation and growth outlook. It will take further monetary actions promptly and appropriately as required to keep inflation expectations firmly anchored and to bring down inflation to the target. The MPC also decided to remain focused on withdrawal of accommodation to ensure that inflation progressively aligns with the target, while supporting growth.
11. All members of the MPC – Dr. Shashanka Bhide, Dr. Ashima Goyal, Prof. Jayanth R. Varma, Dr. Rajiv Ranjan, Dr. Michael Debabrata Patra and Shri Shaktikanta Das – unanimously voted to keep the policy repo rate unchanged at 6.50 per cent.
12. Dr. Shashanka Bhide, Dr. Ashima Goyal, Dr. Rajiv Ranjan, Dr. Michael Debabrata Patra and Shri Shaktikanta Das voted to remain focused on withdrawal of accommodation to ensure that inflation progressively aligns with the target, while supporting growth. Prof. Jayanth R. Varma expressed reservations on this part of the resolution.
13. The minutes of the MPC’s meeting will be published on June 22, 2023.
14. The next meeting of the MPC is scheduled during August 8-10, 2023.
The Reserve Bank held a Conference for the Directors on the Boards of Public Sector Banks. The conference was held in New Delhi. The Governor, RBI inaugurated the Conference. ‘Governance in Banks – Driving Sustainable Growth and Stability’ was the theme of the conference. Deputy Governors Shri M. K. Jain and Shri M. Rajeshwar Rao, along with Executive Directors representing the RBI’s Department of Supervision and Department of Regulation, and other senior officials, also participated in the Conference.
The Governor acknowledged the role played by the banks in supporting the economy and maintaining resilience along with improved financial performance in the face of several adverse shocks in recent times. He exhorted the Directors of banks to further strengthen the governance and assurance functions (risk management, compliance and internal audit) so that the banks are able to identify and mitigate risks at an early stage. The Governor also emphasized the need for banks to ensure continued financial and operational resilience.
The Conference included addresses by the Deputy Governors and technical sessions on Governance and Assurance Functions, Credit Risk, Operational Risk, IT/Cyber Risk and Data Analytics.
The Conference concluded with an open house interaction of the participants with Executive Directors of the Reserve Bank.
