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Both <keyword id="20204377" type="General" weightage="20" keywordseo="indices" source="keywords">indices</keyword>, <keyword id="19896381" type="General" weightage="20" keywordseo="Nifty" source="keywords">Nifty</keyword> and <keyword id="19896382" type="General" weightage="20" keywordseo="Sensex" source="keywords">Sensex</keyword> opened the day in red. As of 9:30 am, Nifty was down by 0.05% trading at 24,420.30 points, while Sensex was down by 0.15% and was trading at 80,254.37 points as of 9:30 am. All broad market indices opened the day in the green, except for Nifty 50, 100, 200, 500, and midcap and smallcap 50 opened in red. India VIX was up by 1.17%. Amidst sectoral indices, Bank, auto, metal, financial services, PSU, and <keyword id="61519" type="General" weightage="20" keywordseo="Private-banks" source="Orion">private banks</keyword> opened the day in the red. Continuing its momentum from yesterday, <keyword id="6912" type="General" weightage="20" keywordseo="Maruti" source="Orion">Maruti</keyword> opened the day in green and was up by 1.66%. Grasim, Divis Labs, Eicher Motors, and Britannia were the top gainers in early trade this morning. On the other hand, Mahindra and Mahindra, JSW Steel, Axis Bank, Dr. Reddy, and Kotak Bank were among the leading laggards. As Mr. Aditya Gaggar, Director of Progressive Shares, notes, "A strong rally in the auto counters helped the index end on trade at another record level of 24,433 yesterday. The index has breached its previous high convincingly by forming a big green candle and opening the door for further rallying towards the 24,520–24,600 zone. At the same time, 24,340 will be considered strong immediate support. BankNifty oscillates in a well-maintained range of 52,260–52,720; a breakout on either side is a must (mostly on the higher side, considering the strong uptrend). The auto segment ended its consolidation of over 2 weeks with a strong breakout indicating the resumption of its uptrend". "Post the strong breakout, follow-up buying was witnessed in the <keyword id="20421583" type="General" weightage="20" keywordseo="FMCG-segment" source="keywords">FMCG segment</keyword> which boosted our confidence to remain bullish on the sector (ITC is on the verge of a major breakout). Sugar counters regained their momentum and some of them have already given a strong breakout (Andhra Sugar and Dalmia Sugar) and some are at the cusp of a major breakout (Balrampur Chini and Renuka Sugar). We continue to remain positive in the <keyword id="20350923" type="General" weightage="20" keywordseo="Pharma-space" source="keywords">pharma space</keyword>", he continued. Shrikant Chouhan, Head of Equity Research, Kotak Securities noted that among sectors, the auto index gained over 2% while intraday profit booking was witnessed in select IT, oil, and gas stocks. "Currently, 24,300/80,000 would act as a key support zone for trend-following traders. We believe, that as long as the market is trading above it, the bullish sentiment will likely continue. On the higher side, 24,500 -24,600/80,500-80,800 would be the immediate resistance zones for day traders", he said.

Stock Market Today: Maruti, Grasim, and Eicher Motors take lead in early trade

New Delhi: Markets regulator <keyword id="19901201" type="General" weightage="100" keywordseo="Sebi" source="keywords">Sebi</keyword> has proposed a minimum ticket size or <keyword id="21732014" type="General" weightage="20" keywordseo="investment-threshold" source="keywords">investment threshold</keyword> of Rs 1 crore for the RBI-regulated originators and unregulated entities engaged in securitisation activities. The proposal also introduced limitations on the number of investors in <keyword id="22496291" type="General" weightage="20" keywordseo="private-placements" source="keywords">private placements</keyword>, allowing <keyword id="23778966" type="General" weightage="20" keywordseo="securitized-debt-instruments" source="keywords">securitized debt instruments</keyword> (SDIs) issued privately to be offered to a maximum of 200 investors. If this limit is exceeded, the issuance must be classified as a public issue. Public offers should remain open for a minimum of three days and a maximum of 10 days, with advertisement requirements aligned with Sebi's regulations for non-convertible securities. Additionally, the regulator has suggested that all securitized debt instruments should be issued and transferred exclusively in demat form. SDIs are financial products created by pooling together various types of debt -- such as loans, mortgages, or receivables -- and then selling them as securities to investors. This process, known as securitisation, allows the originator (such as a bank) to convert illiquid assets into liquid ones, providing an alternative source of funding. Investors in these instruments receive returns based on the performance of the underlying debt pool, and the risk is spread across multiple assets, offering potentially attractive returns. The current framework is based on Sebi's 2008 regulations, with updates from the Reserve Bank of India's (<keyword id="19899808" type="General" weightage="20" keywordseo="RBI" source="keywords">RBI</keyword>) 2021 directions on securitising standard assets. The Securities and Exchange Board of India (Sebi) is now considering updates to the regulatory framework for securitized debt instruments and sought public comments till November 16 on the proposals. Regarding risk management, Sebi has proposed that originators retain a minimum risk retention of 10 per cent of the securitised pool or 5 per cent for receivables with a maturity of up to 24 months. A minimum holding period requirement will also be specified by Sebi for underlying receivables to ensure that originators maintain an interest in the underlying assets, the regulator said in a consultation paper. The regulator further suggested including an optional clean-up call for originators, allowing them to repurchase up to 10 per cent of the original value of the assets. This call is optional and intended to help manage the pool's longevity without mandating additional commitments from the originator. Liquidity facilities, essential to handle timing mismatches in cash flows, should either be provided directly by the originator or through an appointed third party. The updated definition of "debt/receivables" limits permissible underlying assets to listed debt securities, accepted trade receivables, rental incomes, and equipment leases while disallowing single-asset securitisation. The proposal establishes minimum track record requirements for both originators and obligors. Originators should have a minimum of three years of operating experience, while trade receivables specifically require at least two cycles of successful, default-free payments.

Sebi proposes Rs 1 crore minimum investment, mandatory demat form for securitized debt instruments

Star India is set to produce a new web series spotlighting the <keyword id="19899810" type="General" weightage="100" keywordseo="Reserve-Bank-of-India" source="keywords">Reserve Bank of India</keyword> (<keyword id="19899808" type="General" weightage="20" keywordseo="rbi" source="keywords">RBI</keyword>) and its critical role in shaping India’s economy over the past 90 years. The RBI, established in 1935, celebrated its 90th anniversary this April, and the upcoming series will aim to deepen public understanding of the central bank’s operations and achievements. Several prominent media companies — Star India Private Limited, Viacom 18, Zee Entertainment Network Limited, and Discovery Communications India — competed for the project. Following a request for proposal (RFP) by the RBI in July, Star India secured the contract, valued at Rs 6.5 crore, after progressing through final evaluations alongside Viacom 18. The RBI's vision for the series, as outlined in the RFP, includes five episodes of about 25-30 minutes each. This format will allow for an engaging, in-depth look into the RBI’s journey, from its establishment in pre-independence India to its modern-day functions. The episodes will delve into the RBI's mission and vision, major achievements, and ongoing developments, aiming to make the central bank’s functions more relatable and accessible to the general public. With expert interviews, high-quality visuals, and storytelling, the series is designed to demystify complex financial topics for a broad audience. By presenting the RBI's key initiatives, collaborations, and challenges in an engaging way, Star India hopes to foster greater transparency and trust in the central bank. The series will be available on both national television and OTT platforms, expanding its reach and impact. The RBI views this web series as a valuable tool to promote financial literacy. By making the central bank's work understandable and interesting, the series could serve as a bridge between the RBI and the public, contributing to a more financially aware society. (With inputs from agencies)

Curious to know what the Reserve Bank does? Star India will soon produce a web series narrating the RBI's 90-year journey

Imagine this. You have a younger sibling you’re mighty envious of. And why not? Unlike you, they seem to enjoy all the freedom and money in the world. They party like there’s no tomorrow, and here you are, stuck in a boring, ultra-disciplined but responsible routine that feels completely devoid of any independence, and mostly, funds. But of late, things are changing. This sibling is in massive trouble and just cannot escape the parent’s wrath anymore. Long story short, the party is over, and it is time to go back home. The rising defaults on this sibling’s part have now begun pulling the entire house down, thereby attracting the regulator’s ire. <h2>The Wild West of microfinance and unsecured loans</h2>It's hard to ignore the issues with microfinance and unsecured loans in India. Many saw them as a small gamble and ignored the rising defaults much like the younger siblings’ tantrums, and now they find themselves in hot waters. The skyrocketing instances of non-payments aren't a micro-issue anymore and are threatening the stability of the entire banking system. In the quarter ended September 30, 2024, 5 of India’s 8 largest private sector <keyword id="19934118" type="General" weightage="20" keywordseo="banks" source="keywords">banks</keyword> reported a steep rise in their bad loan book, mostly thanks to microfinance loans. Some banks, in a bid to strengthen their fortress against these <keyword id="142154" type="General" weightage="100" keywordseo="bad-loans" source="Orion">bad loans</keyword>, have significantly upped their provisions. For instance, <keyword id="46717" type="General" weightage="20" keywordseo="IndusInd-bank" source="Orion">IndusInd Bank</keyword> set aside Rs 525 crore during July and September 2024 to battle the menace of defaults on microfinance loans, which make up about 9% of its total loan book. See, banks rely heavily on their interest income, which they earn from advancing loans. Any loan where the borrower has not paid interest to the bank or defaulted for 90 days or more becomes bad, i.e., an <keyword id="79363" type="General" weightage="20" keywordseo="npa" source="Orion">NPA</keyword>, or non-performing asset for the bank. And who likes things going bad? Simply put, there has been a steep rise in three areas, much to the dislike of banks and MFIs (micro-finance institutions). But hey, it's mostly their doing! <ol><li>GNPA ratio (gross net performing assets): The quantum of non-performing assets a bank has in proportion to its total assets.</li><li>Provision: The amount banks set aside to take care of such NPAs.</li><li>Slippage ratio: The rate at which good girls go bad, or the speed at which good loans turn into NPAs</li></ol>But how are these plaguing the Indian banking sector? And what does the road ahead look like? We decode it for you. <h2> Microfinance: A not-so-micro-menace</h2>Microfinance loans were initially brought forth for low-income households and individuals, i.e. for those who might not generally have access to traditional ways of credit, like bank loans and more. They don’t require collateral or an asset to be pledged in lieu of the loan, making it a tad bit easier for borrowers. As of June 2024, the amount of outstanding loans in the microfinance industry stood at a staggering Rs 4,20,256 crore. Of this, NBFC-MFIs accounted for 40% and banks made for 33% of these. In 2022, <keyword id="30067" type="General" weightage="20" keywordseo="RBI" source="Orion">RBI</keyword>, in a bid to inspire some competition in this space, did something radical-they did away with the ceiling on how much interest MFIs could charge their customers. Previously, MFIs could add up to 12% to their cost of acquiring funds to determine the final interest rate chargeable to the consumer. So, assuming that Bank A incurs a 5% cost to acquire funds for further loaning, A could charge up to 17% interest from the end consumer. So, interest rates were in the hands of MFIs, and boy, did they have a gala time with it. Instead of spurring some healthy competition, as RBI expected, MFIs and banks went rogue and all guns blazing, competing for the title of “Who will charge the highest interest?” Recently, RBI banned 4 microfinance institutions (MFIs), namely Asirvad Micro Finance Limited, Arohan Financial Services Limited, DMI Finance Private Limited, and Navi Finserv, from disbursing loans effective October 21, 2024. Why? Because they were charging 14% extra interest over their original cost of funds. To maintain their loan books (and pockets), banks and NBFCs resorted to shady practices like netting off loans, which RBI has now advised MFIs against. Here, lenders allow borrowers to settle a previous outstanding loan by issuing them a new loan! As crazy as it sounds, it helped banks to report less of their total assets as NPAs, since the new credit would cover pending installments of the borrower’s previous loan. Then there was the issue of borrowers overleveraging, i.e. taking multiple loans using different IDs from various lenders and then failing to honor any of them. The consequence? Banks and NBFCs end up with massive NPAs. Data from credit bureaus suggests that over the last quarter, there was a 17.2% rise in the number of borrowers who had 5 or more active loans at the same time. <h2>Growth &gt; Caution</h2>It's an age-old tale unfolding yet again in India’s banking sector- Icarus flew too close to the sun and eventually, fell to its death. Between April and June 2024, NBFCs microfinance portfolio jumped by 2.7%. If you see this in terms of loan sources, microfinance loans issued by banks grew by 11.2% in Q1FY25. But the same portfolio in NBFCs swelled by almost double-23.9%. While most of these loans had an average ticket size between Rs 30,000-50,000, there was a sharp spike in the number of loans that had a ticket size of Rs 80,000 or more. Data suggests that as of March 2024, more than 12% of all microfinance borrowers had over 4 or more active loans. In dating parlance, this is a classic case of borrowers going polyamorous, minus the honesty and transparency. Not the best of situations, you'd agree! <h2>Will banks and NBFCs stand up to this stress?</h2>If their results for Q2FY25 are to be believed, NBFCs are not handling the pressure all that well. Or even slightly well. Only a few banks like Bank of Baroda (BoB), ICICI, and Indian Bank were up for the battle, even witnessing a decline in their loan delinquencies. Some others, like IndusInd Bank, saw their stock dip by a massive 16.2% over the last 5 days. Its slippages in the previous quarter burgeoned from Rs 15.3 billion in Q1FY25 to Rs 17.9 billion in Q2. As a result, the bank pushed a staggeringly high amount of money to create an NPA cushion for itself. While its management has highlighted its preference for secured lending, that was hardly reflected in its actions during the quarter, where growth in unsecured personal loans remained exceptionally high at over 7% on a QoQ basis. Turns out, only 44% of customers in IndusInd Banks’ microfinance loan portfolio were exclusive to it. The rest 47% were, you guessed it right-polyamorous! 27% had borrowed from another lender as well, apart from IndusInd Bank, while 20% were those who had outstanding loans with two other lenders, apart from IndusInd Bank. IndusInd Bank’s credit card segment did not miss the NPA bus and accounted for 7-8% of its GNPAs. Canara Bank’s total slippages during the previous quarter jumped to Rs 11.1 billion, up by 24.7% QoQ, and making up for 3.6% of its total loans. As for Bandhan Bank, its <keyword id="763994" type="General" weightage="20" keywordseo="Gross-NPA" source="Orion">gross NPA</keyword> for Q2FY25 inched up on a QoQ basis, up from 4.23% in Q1, to 4.68% in the second quarter. <keyword id="62152" type="General" weightage="20" keywordseo="IDFC-bank" source="Orion">IDFC Bank</keyword>’s heavy provisioning for its NPAs marred its profits significantly, causing its PAT (profit after tax) to dip by 73% on a YoY basis. Data from ICRA Analytics suggest that the AUM (asset under management) growth in microfinance loans and unsecured (personal and business) loans by the NBFCs will moderate to 10-12% and 19-21%, respectively, in FY2025 compared to 30% and 38%, in FY2024. Says A M Karthik, Senior Vice President &amp; Co-Group Head, Financial Sector Ratings, ICRA, “As bank funds constitute a larger share in the overall funding of NBFCs, a slower credit flow from banks to the NBFCs will compress their AUM growth. The NBFCs in unsecured and digital lending businesses shall face a higher squeeze in funding compared to others, and the unsecured lending space will continue to be a source of stress in the near term.” There has been uninhibited growth in unsecured loans, apart from just the microfinance segment. For instance, Axis Bank’s gross slippages jumped by Rs 4,443 crore, largely thanks to its unsecured business. The same is the case with Yes Bank, which saw 35–40% of its retail slippages emerging from the unsecured loan portfolio. Kotak Mahindra Bank was also quick to follow Yes Bank’s suit, with around 35%-40% of its slippages coming from credit cards. <h2>How is the road ahead?</h2>While RBI has just cracked its whip and served a warning at the moment, experts at Morgan Stanley believe that more changes (read regulatory lashes) are underway. Moreover, with both festive and wedding seasons underway in our country, unsecured lending might pick up momentum, much to the disdain of the calibrated approach banks have been taking towards it so far. But if the situation doesn't improve, RBI will not waste any time in becoming the typical tyrannical Bollywood headmaster who runs his dominion with an iron fist and takes things (and ceiling rates) into their own hands. However, that's a story for another day.

Is the lending party over? The dangerous tango of Indian banks with microfinance and unsecured loans

<div type="image" title="The RBI has cracked the regulatory whip on NBFCs and banks, who&amp;#39;ve been pushing microfinance and unsecured loans aggressively to grow their loan books." agency="ANI" msid="114778648" hostid="261" caption="&amp;lt;p&amp;gt;The RBI has cracked the regulatory whip on NBFCs and banks, who&amp;#39;ve been pushing microfinance and unsecured loans aggressively to grow their loan books.&amp;lt;/p&amp;gt;"></div> Imagine this. You have a younger sibling you’re mighty envious of. And why not? Unlike you, they seem to enjoy all the freedom and money in the world. They party like there’s no tomorrow, and here you are, stuck in a boring, ultra-disciplined but responsible routine that feels completely devoid of any independence, and mostly, funds. But of late, things are changing. This sibling is in massive trouble and just cannot escape the parent’s wrath anymore. Long story short, the party is over, and it is time to go back home. The rising defaults on this sibling’s part have now begun pulling the entire house down, thereby attracting the regulator’s ire. <h2>The Wild West of <keyword id="113684" type="General" weightage="20" keywordseo="microfinance" source="Orion">microfinance</keyword> and unsecured loans</h2>It's hard to ignore the issues with microfinance and unsecured loans in India. Many saw them as a small gamble and ignored the rising defaults much like the younger siblings’ tantrums, and now they find themselves in hot waters. The skyrocketing instances of non-payments aren't a micro-issue anymore and are threatening the stability of the entire banking system. In the quarter ended September 30, 2024, 5 of India’s 8 largest private sector <keyword id="19934118" type="General" weightage="20" keywordseo="banks" source="keywords">banks</keyword> reported a steep rise in their bad loan book, mostly thanks to microfinance loans. Some banks, in a bid to strengthen their fortress against these <keyword id="142154" type="General" weightage="100" keywordseo="bad-loans" source="Orion">bad loans</keyword>, have significantly upped their provisions. For instance, IndusInd Bank set aside Rs 525 crore during July and September 2024 to battle the menace of defaults on microfinance loans, which make up about 9% of its total loan book. See, banks rely heavily on their interest income, which they earn from advancing loans. Any loan where the borrower has not paid interest to the bank or defaulted for 90 days or more becomes bad, i.e. an NPA, or non-performing asset for the bank. And who likes things going bad? Simply put, there has been a steep rise in three areas, much to the dislike of banks and MFIs (micro-finance institutions). But hey, it's mostly their doing! <ol><li>GNPA ratio (gross net performing assets): The quantum of non-performing assets a bank has in proportion to its total assets.</li><li>Provision: The amount banks set aside to take care of such NPAs.</li><li>Slippage ratio: The rate at which good girls go bad, or the speed at which good loans turn into NPAs</li></ol>But how are these plaguing the Indian banking sector? And what does the road ahead look like? We decode it for you. <h2> Microfinance: A not-so-micro-menace</h2>Microfinance loans were initially brought forth for low-income households and individuals i.e. for those who might not generally have access to traditional ways of credit, like bank loans and more. They don’t require collateral or an asset to be pledged in lieu of the loan, making it a tad bit easier for borrowers. As of June 2024, the amount of outstanding loans in the microfinance industry stood at a staggering Rs 4,20,256 crore. Of this, NBFC-MFIs accounted for 40% and banks made for 33% of these. In 2022, RBI, in a bid to inspire some competition in this space, did something radical-they did away with the ceiling on how much interest MFIs could charge their customers. Previously, MFIs could add up to 12% to their cost of acquiring funds to determine the final interest rate chargeable to the consumer. So, assuming that Bank A incurs a 5% cost to acquire funds for further loaning, A could charge up to 17% interest from the end consumer. So, interest rates were in the hands of MFIs, and boy, did they have a gala time with it. Instead of spurring some healthy competition, as RBI expected, MFIs and banks went rogue and all guns blazing, competing for the title of “Who will charge the highest interest?” Recently, RBI banned 4 microfinance institutions (MFIs), namely Asirvad Micro Finance Limited, Arohan Financial Services Limited, DMI Finance Private Limited, and <keyword id="20117932" type="General" weightage="20" keywordseo="navi-finserv" source="keywords">Navi Finserv</keyword> from disbursing loans effective October 21, 2024. Why? Because they were charging 14% extra interest over their original cost of funds. To maintain their loan books (and pockets), banks and NBFCs resorted to shady practices like netting off loans, which RBI has now advised MFIs against. Here, lenders allow borrowers to settle a previous outstanding loan by issuing them a new loan! As crazy as it sounds, it helped banks to report less of their total assets as NPAs, since the new credit would cover pending instalments of the borrower’s previous loan. Then there was the issue of borrowers overleveraging, i.e. taking multiple loans using different IDs from various lenders and then failing to honour any of them. The consequence? Banks and NBFCs end up with massive NPAs. Data from credit bureaus suggests that over the last quarter, there was a 17.2% rise in the number of borrowers who had 5 or more active loans at the same time. <h2>Growth &gt; Caution</h2>It's an age-old tale unfolding yet again in India’s banking sector- Icarus flew too close to the sun and eventually, fell to its death. Between April and June 2024, NBFCs microfinance portfolio jumped by 2.7%. If you see this in terms of loan sources, microfinance loans issued by banks grew by 11.2% in Q1FY25. But the same portfolio in NBFCs swelled by almost double-23.9%. While most of these loans had an average ticket size between Rs 30,000-50,000, there was a sharp spike in the number of loans that had a ticket size of Rs 80,000 or more. Data suggests that as of March 2024, more than 12% of all microfinance borrowers had over 4 or more active loans. In dating parlance, this is a classic case of borrowers going polyamorous, minus the honesty and transparency. Not the best of situations, you'd agree! <h2>Will banks and NBFCs stand up to this stress?</h2>If their results for Q2FY25 are to be believed, NBFCs are not handling the pressure all that well. Or even slightly well. Only a few banks like Bank of Baroda (BoB), ICICI, and Indian Bank were up for the battle, even witnessing a decline in their loan delinquencies. Some others, like IndusInd Bank, saw their stock dip by a massive 16.2% over the last 5 days. Its slippages in the previous quarter burgeoned from Rs 15.3 billion in Q1FY25 to Rs 17.9 billion in Q2. As a result, the bank pushed a staggeringly high amount of money to create an NPA cushion for itself. While its management has highlighted its preference for secured lending, that was hardly reflected in its actions during the quarter, where growth in unsecured personal loans remained exceptionally high at over 7% on a QoQ basis. Turns out, only 44% of customers in IndusInd Banks’ microfinance loan portfolio were exclusive to it. The rest 47% were, you guessed it right-polyamorous! 27% had borrowed from another lender as well, apart from IndusInd Bank, while 20% were those who had outstanding loans with two other lenders, apart from IndusInd Bank. IndusInd Bank’s credit card segment did not miss the NPA bus and accounted for 7-8% of its GNPAs. Canara Bank’s total slippages during the previous quarter jumped to Rs 11.1 billion, up by 24.7% QoQ, and making up for 3.6% of its total loans. As for Bandhan Bank, its gross NPA for Q2FY25 inched up on a QoQ basis, up from 4.23% in Q1, to 4.68% in the second quarter. IDFC Bank’s heavy provisioning for its NPAs marred its profits significantly, causing its PAT (profit after tax) to dip by 73% on a YoY basis. Data from ICRA Analytics suggest that the AUM (asset under management) growth in microfinance loans and unsecured (personal and business) loans by the NBFCs will moderate to 10-12% and 19-21%, respectively, in FY2025 compared to 30% and 38%, in FY2024. Says A M Karthik, Senior Vice President &amp; Co-Group Head, Financial Sector Ratings, ICRA, “As bank funds constitute a larger share in the overall funding of NBFCs, a slower credit flow from banks to the NBFCs will compress their AUM growth. The NBFCs in unsecured and digital lending businesses shall face a higher squeeze in funding compared to others, and the unsecured lending space will continue to be a source of stress in the near term.” There has been uninhibited growth in <keyword id="6051027" type="General" weightage="20" keywordseo="Unsecured-loan" source="Orion">unsecured loan</keyword>s, apart from just the microfinance segment. For instance, Axis Bank’s gross slippages jumped by Rs 4,443 crore, largely thanks to its unsecured business. The same is the case with Yes Bank, which saw 35–40% of its retail slippages emerging from the unsecured loan portfolio. <keyword id="6376194" type="General" weightage="20" keywordseo="kotak-mahindra" source="Orion">Kotak Mahindra</keyword> Bank was also quick to follow Yes Bank’s suit, with around 35%-40% of its slippages coming from credit cards. <h2>How is the road ahead?</h2>While RBI has just cracked its whip and served a warning at the moment, experts at Morgan Stanley believe that more changes (read regulatory lashes) are underway. Moreover, with both festive and wedding seasons underway in our country, unsecured lending might pick up momentum, much to the disdain of the calibrated approach banks have been taking towards it so far. But if the situation doesn't improve, RBI will not waste any time in becoming the typical tyrannical <keyword id="19897820" type="General" weightage="20" keywordseo="bollywood" source="keywords">Bollywood</keyword> headmaster who runs his dominion with an iron fist. However, that's a story for another day. Do you have a topic in mind you'd want a simpler explanation for, or insights or personal experience to share on personal finance and more? Contact us at businessinsider@timesinternet.in.

Simply Put: Is the lending party over? The dangerous tango of Indian banks with microfinance and unsecured loans

<ul class="summary-list"><li>KKR is in talks to acquire adtech firm Integral Ad Science, sources told Business Insider.</li><li>IAS appointed investment bank Jefferies to explore options after receiving takeover interest.</li></ul>Private equity firm KKR is in talks to acquire the publicly listed adtech company Integral Ad Science, three people familiar with the process said.It couldn't be immediately determined whether the discussions were at an advanced stage, and the plans could change.One of those people and an additional source said other potential acquirers had also expressed an interest in IAS but didn't offer further information. All of the people asked for anonymity to protect their business relationships; their identities are known to Business Insider.<a target="_blank" class="" href="https://www.bloomberg.com/news/articles/2024-10-25/integral-ad-science-is-said-to-explore-potential-sale?embedded-checkout=true">Bloomberg</a> reported last month that IAS had appointed the investment bank Jefferies to explore its options after receiving takeover interest. IAS shares popped more than 10% on the news at the time.KKR and IAS declined to comment.Founded in the US in 2009, IAS offers technology that advertisers use to measure the quality and performance of their ads and to help them avoid their campaigns appearing next to unseemly content. It also offers solutions to publishers that help them verify that their ads are viewable, fraud-free, and placed in suitable environments for brands.IAS has recently signed new or expanded partnerships with major tech companies like Google, Amazon, and Reddit. In its second quarter, the company grew revenue by 14% to $129 million and raised its full-year guidance. IAS is due to report its third-quarter earnings on November 12.A take-private deal by a private equity firm like KKR could help IAS grow further without the quarterly Wall Street scrutiny. IAS was previously private equity-owned after Vista Equity Partners acquired it in 2018. Vista retains a more than 40% stake in IAS, which went public in 2021.KKR already has an ad industry footprint. It has stakes in the public adtech company AppLovin, the corporate communications firm FGS Global, and the customer experience software provider Alchemer.(KKR was also a shareholder in Business Insider's parent company Axel Springer. In September, Axel Springer announced it would <a target="_blank" class="" href="https://www.axios.com/2024/09/19/axel-springer-kkr-break-up">separate</a> its media properties into a privately-owned company, while KKR retained the classifieds side of the business.)KKR has <a target="_blank" class="" href="https://ir.kkr.com/app/uploads/2024/10/KKR-Q324-Earnings-Release.pdf">over $600 billion</a> in assets under management.<a target="_blank" class="" href="https://www.businessinsider.com/private-equity-firms-investing-in-advertising-and-marketing-companies-2024-3#kkr-7">Ted Oberwager</a>, a partner at KKR who leads its gaming, entertainment, media, and sports verticals, told BI earlier this year that the firm was looking to invest in companies that had "great teams and leaders who can navigate the rapidly shifting advertising, marketing, and communications landscapes."IAS fiercely competes with ad verification rival DoubleVerify, which is larger in terms of annual revenue and has a market capitalization of $3.3 billion to IAS's $1.99 billion as of publication time.Both companies came under recent <a target="_blank" class="" href="https://www.businessinsider.com/doubleverify-integral-ad-science-face-fresh-brand-safety-scrutiny-2024-6">scrutiny</a> after a series of reports found their advertiser clients had run ads in <a target="_blank" class="" href="https://adalytics.io/blog/ai-brand-safety">unsavory</a> corners of the web, such as sites with graphically violent, racist, or pornographic content — despite using the companies' brand safety software. The companies have disputed those reports' methodologies and findings.Publishers have also <a target="_blank" class="" href="https://www.businessinsider.com/integral-ad-science-doubleverify-help-brands-avoid-coronavirus-news-2020-3">criticized</a> brand safety methods such as keyword blocking and exclusion lists — words that trigger ads to be blocked on a webpage — as blunt instruments that unfairly demonetize their content. IAS and DoubleVerify have said they have refined their brand safety tools by pushing further into areas like AI and other technologies that analyze the context and semantics of an article.

Private equity giant KKR is in talks to acquire the adtech company Integral Ad Science

<ul class="summary-list"><li>Apollo Global Management has been investing big in non-bank loans.</li><li>Helping fund that growth has been growing demand for retirement products, said CEO Marc Rowan.</li></ul>There's been a lot of attention on Apollo Global Management's <a target="_blank" rel="noopener noreferrer" class="c-link" href="https://www.businessinsider.com/apollo-ceo-marc-rowan-defends-private-credit-from-jamie-dimon-2024-5">burgeoning lending business</a>, which the firm projects will double in size to <a target="_blank" rel="noopener noreferrer" class="c-link" href="https://www.businessinsider.com/apollo-global-management-investor-day-presentation-one-trillion-private-lending-2024-10">$1.2 trillion in five years</a>.Helping to fund those loans is Apollo's retirement business, which <a target="_blank" rel="noopener noreferrer" class="c-link" href="https://www.businessinsider.com/apollo-ceo-marc-rowan-management-tactics-430-am-wakeup-call-2024-10">Apollo CEO and cofounder Marc Rowan</a> sees as the investment firm's "single biggest opportunity" for future growth.In a conference call to discuss third-quarter earnings, Rowan said Apollo's insurance affiliate Athene had become an industry leader in annuities, or insurance products used in retirement, to generate regular income. Athene saw $20 billion in inflows during the third quarter and $77 billion over the last year, which helped drive a 16% year-over-year growth in assets under management to $733 billion.<div type="image" title="Apollo chart showing capital inflows." height="884" width="1597" msid="114993225" hostid="261" sizebytes="75180"></div>Rowan said he sees continued growth in that sector, aided by the company's efforts to provide new and improved retirement products, including tools to guarantee income for life."The notion of simplification and getting to guaranteed lifetime income, I believe, to be the North Star for where we would like to go," Rowan said on the call. "But this notion of rethinking the product set, I believe to be the single biggest opportunity in front of us, and that is what is baked into our five-year plan over the next few years."The opportunity stands to become even bigger, Rowan said, if regulators open up 401(k)s and other tax-deferred retirement accounts to investments led by alternative asset managers like Apollo."Should we get access to 401(k) through broad-based reform or regulatory change or regulatory encouragement, I believe that would be upside not just for us, but for the entire industry," he said.Rowan has been a major proponent of Australia's retirement model, which was opened up to private assets around forty years ago in a <a target="_blank" href="https://www.businessinsider.com/how-make-us-retirement-system-better-australia-superannuation-benefits-2024-4">process called superannuation</a>. Rowan said that plans with private assets, which can access the compounding effects of private equity, have 40% to 60% better outcomes than those just with public assets."I do envision a day when we will be talking about 60-40 portfolios that are comprised of public and private," Rowan said.This would be a huge shift from the current regime, where much of American retirement savings are in the public stocks or bonds. But to Rowan, a retirement system where between $12 trillion to $13 trillion of American's wealth is in 401(k)s that are largely invested in the <a target="_blank" href="https://www.businessinsider.com/stock-market-whiplash-shows-dont-worry-too-much-about-401k-2024-8">S&amp;P 500 </a>makes little sense."I jokingly say sometimes, we levered the entire retirement of America to <a target="_blank" href="https://www.businessinsider.com/nvidia-stock-price-blackwell-ai-market-value-costco-jensen-huang-2024-10">Nvidia's performance</a>," Rowan said last month. "It just doesn't seem smart."The Trump Administration opened some 401(k) investing to private equity <a target="_blank" href="https://www.bloomberg.com/news/articles/2020-06-03/private-equity-firms-get-trump-administration-s-nod-to-tap-401ks">in 2020</a>, suggesting that a Trump victory could help fuel the alternative industry's expansion efforts. Rowan hasn't endorsed a US presidential candidate.

Your nest egg is private-equity giant Apollo's 'single biggest opportunity' for growth

<ul class="summary-list"><li>Goldman Sachs named 95 partners last week, including private wealth exec Brittany Boals Moeller.</li><li>The 39-year-old runs the Southeast region and leads strategy for young and women clients.</li></ul>Brittany Boals Moeller, one of Goldman Sachs' newly minted partners, didn't picture a career in finance when she joined the bank 17 years ago. She grew up in Jonesboro, Arkansas, where her parents were professors at the local university. After graduating from New York University in 2007, she thought she would work at Goldman Sachs for a few years to save up for graduate school, perhaps to study public policy or become a lawyer. But even when the financial crisis hit, which was an opportune time to go back to school, she didn't want to leave."At Goldman, you are given tremendous responsibility and opportunity young in your career if you prove yourself able," she told Business Insider in an interview. "I've never once been bored, and so it's an easy choice to stay."The 39-year-old is based in Atlanta and runs the Southeast region of Goldman Sach's private wealth division. While wealth management clients skew older, the division has a pipeline of rich millennial founders who work with the investment banking arm. Boals Moeller said these clients in their 30s and 40s are more likely to want more than investment advice, desiring services like concierge healthcare and bill pay that make their lives easier. To keep these clients loyal, she leads an initiative to cater to younger clients, including heirs and self-made entrepreneurs, and another that focuses on women customers."They're busy. They want simplicity. They need good people around them to help," she said.During the dealmaking drought, the <a target="_blank" href="https://www.businessinsider.com/goldman-sachs-private-wealth-management-asset-david-solomon-2023-1">wealth management</a> business gained new prominence. "Quite frankly, private wealth management at Goldman Sachs has never been as much of a focus for the firm as it is today," division cohead John Mallory told BI in 2023.Boals Moeller said the business's current stature is the result of investments more than a decade in the making. She served as chief of staff to wealth management head Tucker York during the financial crisis. Around 2010, she embarked on a listening tour of every wealth office. The advisor feedback led to the bank expanding its offerings beyond investment and tax planning advice."We knew this going way back, and it certainly continues today, which is we are not purely an investment solution for our clients," she said. "Investments are critical and core to our work, but increasingly we're seeing that with the next generation of wealth owners today, they are seeking simplicity and solutions in all aspects of their life."Goldman Sachs' family office offering, Apex, launched a few years later. Now, the division offers chief financial officer services to help clients with not just estate planning but also lifestyle services like cybersecurity.Catering to these younger clients, whether they are old-money heirs or startup founders celebrating their first windfall, requires meeting them where they are. That usually isn't over a steak and martini lunch or 18 holes at the golf course. What entices these clients more, Boals Moeller said, is getting to meet like-minded people.Goldman Sachs holds events and conferences, often with star-studded lineups or in scenic locales. In August, Boals Moeller hosted a reception in Atlanta with singer Ciara and Marc-Kwesi Farrell, the founder of a rum brand that provided custom cocktails. In October 2023, Goldman Sachs hosted a conference in Deer Valley where billionaire Patrón founder John Paul DeJoria talked about keeping a business empire in the family. Sustainability and sports are particularly interesting to this demographic, with Goldman Sachs hosting a tour of a waste-to-clean-energy power plant in Copenhagen and bringing in Michelle Hynik, president of women's football club Utah Royals, to the Deer Valley summit.Advisors also introduce clients to each other when appropriate, such as a pre-IPO founder to an entrepreneur who has already been through the process."A lot of effort is put into helping people not only just manage the risk and obviously the investment side of things, but also the broader piece, which is how do we help you have an amazing corporate outcome from the sale of your business, and how do we help you as a family appropriately prepare for that?" she said.Advisors can meet with families one-on-one for financial education. However, many of these millennial and Gen-Z clients prefer digital education on their own time. Goldman Sachs has courses for children of clients as early as 15 years old. This Semester at GS program has six one-hour sessions that span trading talks from executives in global markets as well as personal finance topics like how to think about a credit score. These virtual sessions are cameras off, Boals Moeller notes."You don't have to be at a desk," she said. "It's not another hour of homework."

This new Goldman Sachs partner is leading the bank's strategy with young heirs and founders

Indian companies across multiple sectors have reported disappointing results in the second quarter of fiscal year 2025, notes a new JM Financials report. Consequently, their poor performance has triggered stock price corrections for affected companies. The brunt of this weaker than expected earnings was largely borne by consumer centric sectors like FMCG (fast moving consumer goods), retail, and auto, which slacked largely due to dampened urban demand. For instance, India's largest automaker, Maruti Suzuki, reported a 5% YoY decline in its total domestic passenger vehicle wholesales, largely on the back of pent-up inventory. Similarly, Honda reported a staggering 23% YoY dip in its total sales during October 2024. A recent report by Bernstein noted that around 48% of the companies listed on the NSE100 index missed their earnings estimate for Q2FY25, the highest since March 2020. Most companies have mentioned deteriorated domestic demand, urban slowing, macroeconomic risk, and margin pressures as the main reasons behind the dip. "The quarter's earnings have made investors nervous," noted the JM Financials report. The challenging environment stems from multiple factors: softening consumer demand, rising input costs, and companies' limited ability to increase prices. Moreover, this is not limited to just one quarter. Companies have been reporting weak, single-digit earnings growth for the last six consecutive quarters. Data from India Data Hub also suggests that corporate profits of listed companies plunged by as much as 3.4% during the quarter ended September 30, 2024. This is in stark contrast to the year-ago period, where they had shot up by over 40% The oil and gas sector had a difficult quarter, with refiners hit by weak margins and city gas distributors struggling with higher input costs. Financial institutions showed mixed results. While government-owned banks reported strong numbers, microfinance institutions and some private lenders faced massive difficulties with their unsecured loans. Most notable amongst this was the case of IndusInd Bank, which saw its net profits dip by 40% amidst burgeoning provisions, which climbed 87% to Rs 1,820 crore in Q2, as against Rs 974 crore reported in the year-ago period. <h2>Markets head southwards</h2>The selling trend by FPIs has dragged down the major Indian indices, the Nifty 50 and Sensex, both of which have dropped by around 8% since the beginning of this selling spree in October. According to National Securities Depository Ltd. (NSDL) data, FPIs offloaded equities worth a significant Rs 19,994 crore in just the first five trading sessions of November last week. The impact is clearly visible on Indian stock markets. Data suggests that while every sector in October closed the month in red, auto, oil and gas, and consumer durables were the most badly hit, each declining by as much as 10% during the month. Another indicator underlining the inherent weakness of the market was that the month saw only 242 stocks hit their 52-week high, significantly below the usual monthly average of 310.

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You Searched For "Private banks" and got 9 results

Stock Market Today: Maruti, Grasim, and Eicher Motors take lead in early trade

Ira Alok Puranik

Sebi proposes Rs 1 crore minimum investment, mandatory demat form for securitized debt instruments

PTI

Curious to know what the Reserve Bank does? Star India will soon produce a web series narrating the RBI's 90-year journey

BI India Bureau

Is the lending party over? The dangerous tango of Indian banks with microfinance and unsecured loans

Ira Alok Puranik

Simply Put: Is the lending party over? The dangerous tango of Indian banks with microfinance and unsecured loans

Ira Alok Puranik

Private equity giant KKR is in talks to acquire the adtech company Integral Ad Science

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Your nest egg is private-equity giant Apollo's 'single biggest opportunity' for growth

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This new Goldman Sachs partner is leading the bank's strategy with young heirs and founders

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India Inc. stares at an earnings dearth in Q2, FMCG, auto, and consumer durables falter

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