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Business Tit-Bits

Why is there a change of bank CEO and fall in profits?

Akhilesh Bhargava

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There has been a sharp fall in the recently reported quarterly profits of Yes Bank and ICICI Bank. Their quarterly profits fell by over 50% and did not even meet the tapered down expectation of the street analysts. This collapse of quarterly profits coincides with the change of guard at the two banks. Both, Ms. Chanda Kochhar the former MD/CEO of ICICI Bank, as well as Rana Kapoor, the truncated founder CEO of Yes Bank, have been found guilty of accounting malpractices, violation of corporate governance norms and regulatory failures by the RBI, all of which make the financial statements of the two bank, authored under their tenure, to be suspect. The question is why is there a change of bank CEO and fall in profits? Mr. Akhilesh Bhargava, Business Editor of HW Business and Finance shares his insights on the matter.

Business Tit-Bits

The Burden of Infrastructure NPAs

Akhilesh Bhargava

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As the country is the midst of an NPA crisis, we find that resolution are hard to come by. The only resolutions are from the Steel and Metal sector. The sector which forms the crux of the NPA crisis in India is the Infrastructure sector which accounts for roughly 25% of total NPAs. Infact, so serious are the NPAs in this sector that 1/4th of loans given turn bad and total around 2.5 lakh crore Rs. Loans given in the period 2009 to 2012 were found to be the worst. Infrastructure loans include loans given for construction of roads, bridges, highways, ports and power sector loans. Corruption, government not living up to its end of the deal and banks rushing to give loans without going through boanfides of the firm are the main reasons. The infrastructure sector bad loan problem has turned into a chronic one and no resolution worth talking about has taken place.

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Business Tit-Bits

The Diamond Cheats

Akhilesh Bhargava

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We take a look into the glamorous diamond industry in India, said to be the largest in the world. Being a very close-knit one in terms of belonging to a particular community and often only within family members, the scope for manipulation becomes easy. The diamond industry has become tainted with bogus exports, money laundering practices, massive NPAs, round-tripping of money etc. Names such as Jatin Mehta, Mehul Chokshi and Nirav Modi have become synonymous with the industry and hence banks are now restricting their exposure to the sector and implementing tougher conditions for lending money to the beleaguered diamond traders.

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Business Tit-Bits

Why Mr. Jaitley should stop the reckless tax prosecution?

Akhilesh Bhargava

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As many industry and tax associations approach the Revenue Secretary for help to prevent income tax authorities from unfairly harrasing and prosecuting them for minor discrepencies, we ask Mr. Arun Jaitley why is this being done. This culture of “prosecution raj” is hurting small and big businesses alike and is sending the wrong message to India Inc. Giving arbitary powers and setting not only revenue, but also prosecution targets for income tax officers is unfair and businessman are bearing the brunt of this. In addition to penalty and interest, other prosecution punishment is being handed down for the most minor of offences which is leaving a bad taste in the mouth of industry at large.

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