ஆப்பிள்: 11 ரகசியங்கள்

எங்கும் நிறை ஐ-போன், ஐ-பேட் ஆகியவற்றைத் தயாரிக்கும் நிறுவனம் அமெரிக்காவின் கலிஃபோர்னியாவில் இருக்கிறது. இந்த நிறுவனம் குறித்து மிகக் குறைவாகவே வெளியுலகுக்குத் தெரியும். மேலும் தெரிந்துகொள்ளச் சில தகவல்கள்:

1ஸ்டீவ் ஜாப்ஸ் ஒரு தத்துப்பிள்ளை, அப்பா சிரிய நாட்டவர்:

ஆப்பிள் நிறுவனத்தை ஸ்டீவ் ஜாப்ஸ், ஸ்டீவ் வோஸ்னியாக், ரொனால்ட் வெய்ன் என்ற மூவர் தொடங்கினர். இந்த நிறுவனத்தின் முதன்மை நிர்வாக அதிகாரியாகவும் இருந்த ஸ்டீவ் ஜாப்ஸ், 2011 அக்டோபரில் காலமானார். ஜோன் ஷிபல், அப்துல்ஃபட்டா ஜண்டாலி என்ற இருவரும் தங்களுடைய 23-வது வயதில் விஸ்கான்சின் பல்கலைக்கழகத்தில் சேர்ந்தபோது சந்தித்துக்கொண்டனர். அவர்களுடைய மகன்தான் ஸ்டீவ் ஜாப்ஸ். ஷீபலின் பெற்றோர் கொடுத்த நெருக்குதல் காரணமாக 1955-ல் ஸ்டீவ் ஜாப்ஸ் தத்துக்கொடுக்கப்பட்டார். ஷீபலும் ஜண்டாலியும் பிறகு திருமணம் செய்துகொண்டனர். அவர்களுக்கு ஒரு பெண் குழந்தை பிறந்தது.

2 ஆப்பிளின் முதல் கம்ப்யூட்டருக்கு ‘சாத்தான்’ விலை:

ஆப்பிள் நிறுவனம் தயாரித்த முதல் கணிப்பொறி ‘ஆப்பிள்-1’ விலை 666.66 டாலர் என்று நிர்ணயிக்கப்பட்டது. 6 என்ற எண் அடுத்தடுத்து 3 முறை வருவது சாத்தானைக் குறிப்பது என்பது விலையை நிர்ணயித்த ஸ்டீவ் வோஸ்னிக்குக்குத் தெரியாது. அந்தக் கணிப்பொறியின் மொத்த விற்பனை விலை 500 டாலர். அத்துடன் மூன்றில் ஒரு பங்கு விலையைச் சேர்த்து சில்லறை விற்பனை விலையை நிர்ணயித்தார். 667 டாலர் என்பதே அந்த விலை. ஆனால், பில்லில் ‘டைப்’ செய்ய வசதியாக இருக்கட்டும் என்று 666.66 என்று நிர்ணயித்தார்!

3 விமானத்தில் பறக்கும் ஆப்பிள்:

கத்தாய் பசிபிக் விமான நிறுவனத்தின் மிகப் பெரிய வாடிக்கையாளர் ஆப்பிள் நிறுவனம்தான். கப்பல் வழியாக அனுப்ப விரும்பாமல் தன்னுடைய தயாரிப்புகளை விமானம் மூலமே அனுப்பியது. இதனால் சரக்குகள் உரிய இடத்தை வெகு விரைவாக அடைந்தன. சரக்குக் கட்டணம் அதிகமாக இருந்தாலும், சரக்குகள் விற்பனைக்கு வராமல் முடங்கும் காலம் கணிசமாகக் குறைந்தது. இதனால், கையிருப்பு ஸ்டாக்குகளில் பணம் முடங்குவது கணிசமாகக் குறைந்தது. கப்பல்களில் ஏற்றப்படும் சரக்குப் பெட்டகங்களில் கைபேசிகள், டேப்லெட்டுகள், கணிப்பொறிகள் வருவதை அறிந்து அதை கொள்ளைக்காரர்கள் கடத்தும் ஆபத்தும், விபத்து நேரிட்டால் கடலில் மூழ்கி, சந்தைக்குக் கிடைக்காமல் போகும் வாய்ப்புகளும் உண்டு. அது விமானத்தில் அனுப்பியதால் தவிர்க்கப்பட்டது.

4மசின்டோஷ்:

ஆப்பிள் நிறுவனம் தயாரித்த ‘மசின்டோஷ்’, ஜெஃப் ரஸ்கினுக்கு மிகவும் பிடித்த ரகம். அப்போதைக்கு அது குறியீட்டுப் பெயர்தான். ரஸ்கின் அலுவலகத்தில் இல்லாத நேரம் அங்கு வந்த ஜாப்ஸ் அதற்கு ‘பை-சைக்கிள்’ என்று பெயர் சூட்ட முற்பட்டார். என்ன காரணத்தாலோ அது தடைப்பட்டது. ‘மசின்டோஷ்’ என்ற பெயர் நிலைத்ததுடன் நன்கு பிரபலமும் ஆகிவிட்டது.

5ஆப்பிளின் வித்தியாசமான ஹீரோ ஷாட்டுகள்:

ஆப்பிள் நிறுவனத்தின் விளம்பரங்களில் இடம்பெற்ற படங்கள் கம்ப்யூட்டரில் உருவாக்கப்பட்டவை அல்ல. மிக நன்றாகப் படம்பிடிக்கப்பட்ட சூப்பர் - குளோசப் புகைப்படங்களைச் சேர்த்து உருவாக்கியவை.

6ஸ்டீவ் வோஸ்னியாக் இன்னமும் ஊழியர்தான்:

ஆப்பிள் நிறுவனத்தின் இணை நிறுவனரான ஸ்டீவ் வோஸ்னியாக், வோஸ் என்றும் அழைக்கப்படுவார்.

1976-ல் தன்னுடைய கார் கேரேஜில் ஸ்டீவ் ஜாப்ஸுடன் சேர்ந்து ஆப்பிள் நிறுவனத்தைத் தொடங்கினார். இப்போது தொடர்ந்து வேலைக்கு வருவதில்லை என்றாலும், ஊழியர் பட்டியலில் பெயர் இருக்கிறது. அதுமட்டுமல்ல, ஆண்டுக்கு 1,20,000 டாலர்கள் உதவித் தொகையாக வழங்கப்படுகிறது.

7ஓ வவ். ஓ வவ். ஓ வவ்:

ஸ்டீவ் ஜாப்ஸ் இறப்பதற்கு முன்னால் தனது படுக்கைக்கு அருகில் திரண்டு நின்ற குடும்பத்தினரைப் பார்த்து “ஓ வவ். ஓ வவ். ஓ வவ்” என்று 3 முறை கூறியதாக அவருடைய சகோதரி மோனா சிம்ப்சன் தெரிவிக்கிறார். மோனா எழுதிய இரங்கல் கவிதைதான் ஸ்டீவ் ஜாப்ஸ் நினைவு பிரார்த்தனைக் கூட்டத்தில் வாசிக்கப்பட்டு ‘நியூயார்க் டைம்ஸ்’ பத்திரிகையிலும் பிரசுரிக்கப்பட்டது.

83,500 கோடி டாலர்கள் போச்சே:

ஆப்பிள் நிறுவனத்தை 1976-ல் ஸ்டீவ் ஜாப்ஸ், ஸ்டீவ் வோஸ்னியாக், ரொனால்ட் வெய்ன் ஆகிய மூன்று பேர் தொடங்கினர். இவர்களில் ரொனால்டுதான் ஆப்பிள் நிறுவனத்தின் இலச்சினையை வரைந்து, கூட்டு ஒப்பந்தப் பத்திரத்தைத் தயாரித்து, ‘ஆப்பிள்-1’ கணினி நிறுவனத்துக்கான தயாரிப்பு வரைமுறையை எழுதியவர். பிறகு, கடன் தொல்லையால், அந்த நிறுவனத்தில் தனக்கிருந்த 10% பங்குகளை வெறும் 800 டாலர்களுக்கு விற்றுவிட்டார். அந்தப் பங்குகளை மட்டும் அவர் இப்போது தன்னிடமே வைத்திருந்தால், அதன் மதிப்பு 3,500 கோடி டாலர்களாகும்!

9ஐவ்-வுக்கு நன்றி:

வெள்ளை நிறத்தில் எதையுமே தயாரிக்கக் கூடாது என்று முதலில் எதிர்ப்புத் தெரிவித்தார் ஸ்டீவ் ஜாப்ஸ். ஆனால், ஆப்பிள் நிறுவனத்தின் வடிவமைப்பாளரான சர் ஜானி ஐவ் அதை வெள்ளை நிறத்தில் தயாரித்தபோது ஏற்றுக்கொண்டார். ‘மூன் கிரே’ வண்ணத்தில் தயாரித்துக் காட்டினாராம் ஐவ். அது வேண்டாம் என்று ஸ்டீவ் ஜாப்ஸ் நிராகரித்ததால் வெள்ளை நிறத்தில் தயாரித்துக் காட்டினாராம். இதை மற்றொரு வடிவமைப்பாளரான டக் ஸாட்ஸ்கர் தன்னுடைய சுயசரிதையில் குறிப்பிட்டிருக்கிறார்.

10கட்டு எப்படி?

ஆப்பிள் நிறுவனம் தன்னுடைய பொருள்களைத் தயாரிக்க எடுத்துக்கொள்ளும் அக்கறைக்குச் சற்றும் குறைவில்லாமல் அதை அடைக்கும் பேக்கிங்குகளுக்கும் தருகிறது. கலிஃபோர்னியாவின் கபுர்டினோ என்ற இடத்தில், பேக்கிங் வடிவமைப்பதற்காக ரகசிய இடத்தையே வைத்திருந்தார்களாம். பேக்கிங் டிசைனர்கள் என்ற வடிவமைப்பாளர்கள் மணிக் கணக்கில் வேலை செய்து விதம்விதமாகப் பெட்டிகளைத் தயாரித்துவந்து காட்டுவார்களாம். ஆப்பிள் நிறுவனத் தயாரிப்புகளை விலைகொடுத்து வாங்கும் வாடிக்கையாளர்கள் வீட்டுக்குப் போய் அதைப் பிரிக்கும்போது அவர்களுடைய முகங்களில் ஏற்படும் மகிழ்ச்சி, திருப்தி, பூரிப்பு, பெருமிதம் ஆகியவை வெளிப்படும் விதத்தில் பேக்கிங் இருக்க வேண்டும் என்பதற்காகவே அக்கறை எடுத்துக்கொள்வார்கள். ஆப்பிள் சாதனங்கள் கண்ணுக்குத் தெரியாதபடிக்குப் பெட்டியில் அடைத்து வைக்கப்படும். அந்த அட்டைப் பெட்டியை எப்படி, எங்கே, சேதமில்லாமல் எளிதாகப் பிரிக்க வேண்டும் என்று அம்புக்குறிகளும் வாசகங்களும் பொறித்திருப்பார்கள். அந்தக் குறிகளைத் தயாரிக்கவும் அதற்கு வண்ணம் தேர்வு செய்யவும்கூட பெரும் அக்கறை எடுத்துக்கொண்டார்கள்.

11பந்துகள்:

ஜானி ஐவ் வாழ்க்கைகுறித்துப் புத்தகம் எழுதிவரும் லியாண்டர் கானி தனது புத்தகத்தில், ‘ஐமேக் ஜி4’ என்பது ஒரு பெட்டிக்குள் வைக்கப்பட்டிருப்பது போன்ற புகைப்படத்தைச் சேர்த்துள்ளார். அந்த சாதனத்தில் பந்து வடிவ ஸ்பீக்கர்கள் அதன் இரு புறங்களிலும் இருப்பதைப்போல வடிவமைத்துள்ளனர். அசப்பில் இது ஆணின் மர்மஸ்தானத்தைப் போலவே காட்சிதருகிறது. இது என்ன என்று கேட்டால், வடிவமைப்பாளர்கள் வேண்டுமென்றே இப்படி இதைச் செய்ததாகப் பதில் கிடைத்திருக்கிறது.

ஜானி ஐவ் உலகப் புகழ் பெற்ற வடிவமைப்பாளர். அவருடைய பள்ளிக்கூடப் புகைப்படமும் இந்தப் புத்தகத்தில் இடம்பெற்றுள்ளது. அந்தப் புகைப்படத்தில் அவருடைய கிராப்புத் தலை மிக வித்தியாசமாக வசீகரமாக இருக்கிறது.

  தி இந்து   புதன், பிப்ரவரி 26, 2014

Powerful Quotes of Steve Jobs :Have the courage to follow your heart and intution.They somehow already know what you truly want to become. Everything else is secondary.

The Spirit of Warren Buffett ; you know....you keep doing the same things and you keep getting the same result over and over again.

Quotes :
  "you know....you keep doing the same things and 
   you keep getting the same result
    over and over again."
The Times of Warren Buffett :

Wealth

In 2008 he was ranked by Forbes as the richest person in the world with an estimated

 net worth of approximately US$62 billion. In 2009, after donating billions of dollars to charity,

 Buffett was ranked as the second richest man in the United States with a net wort

h of US$37 billion^[112][113] with only Bill Gates ranked higher than Buffett.

 His net worth is up to $47 billion as of March 2010.

Books on warren Buffett :

Author : Timothy Vick

New bank licences: Bimal Jalan-led panel submits recommendations to RBI

F biz Feb 25, 2014

The Bimal Jalan-headed committee, scrutinizing the 25 bank license applications, submitted its recommendations to the Reserve Bank today amid speculations that Election Commission's Code of Conduct will have a bearing on the process of awarding new bank licenses.

Sources in the RBI told CNBC-TV18 that the Jalan panel has submitted its recommendations on eligibility of all applicants and a final call will be taken by the central bank.

"We have submitted report (on new bank licences) to RBI," Jalan, a former Reserve Bank Governor, said after a four-hour meeting here, PTI reported.

Finance ministry sources indicated that prima facie Election Code of Conduct doesn't apply to RBI but a final decision will be taken after the EC's issuance.

Earlier, speaking to CNBC-TV18, sources saidcriminal investigation doesn't bar applicants from obtaning a license since registration of case, without conviction, is not enough to strike down applicants.

The Jalan Panel has assessed the reports of all investigative agencies.

The committee  held its third and final meeting today before submitting its recommendations to the central bank. The panel had first met on November 1. The report contains names of entities eligible for bank licences. It was not immediately known how many applicants have been shortlisted by the high-leveladvisory panel.

The licences are likely to be awarded my March-end and the election code of conduct will not affect the process, banking Secretary Rajiv Takru said.

Guidelines for setting up new private banks were issued in February 2013. The last day for applications was July 1. The RBI received 27 applications and subsequently, Tata Sons Ltd and Value Industries Ltd withdrew.

Anil Ambani's Reliance Group, Aditya Birla Group and Bajaj Finance are some of the prominent names in the race. Muthoot Finance, Religare Enterprises, L&T Finance Holdings, India Bulls Housing Finance Ltd are among the other companies who have applied for licences.

Public sector units in the fray are India Post and IFCI.

Kotak Mahindra Bank and Yes Bank were the last two entities to get banking licences from the RBI in 2003-04.

In the past 20 years, the RBI has licensed 12 banks in the private sector in two phases. Ten banks were licensed on the basis of guidelines issued in January 1993.

India has 27 public sector banks, 22 private sector banks and 56 regional rural banks.

With inputs from PTI

Fasten your seatbelts: Not only United Bank, a major part of banking is in trouble

 n  Vivek Kaul : f Biz :8 mts ago

 In  an editorial today (i.e. February 26, 2014), on the troubled United Bank of India, The Financial Express asks “Wasn't anybody watching?”. “It is amazing that things could have been allowed to come to such a pass without action being taken to stop it,” the pink-paper points out.

In fact, The Financial Express should have been asking this question about the Indian banking sector as a whole, and not just the United Bank in particular. As of September 30, 2013, the stressed asset ratio of the Indian banking system as a whole stood at 10.2% of its total assets. This is the highest since the financial year 2003-2004 (i.e. the period between April 1, 2003 and March 31, 2004) point out Tushar Poddar and Vishal Vaibhaw of Goldman Sachs in a recent report titled India: No ‘banking’ on growth.

Interestingly, the public sector banks are in a worse situation than their private sector counterparts. As the latest RBI Financial Stability Report points out “Among the bank-groups, the public sector banks continue to have distinctly higher stressed advances at 12.3 per cent of total advances, of which restructured standard advances were around 7.4 percent.”

The stressed asset ratio is the sum of gross non performing assets plus restructured loans divided by the total assets held by the Indian banking system. What this means in simple English is that for every Rs 100 given by Indian banks as a loan(a loan is an asset for a bank) nearly Rs 10.2 is in shaky territory. The borrower has either stopped to repay this loan or the loan has been restructured, where the borrower has been allowed easier terms to repay the loan (which also entails some loss for the bank) by increasing the tenure of the loan or lowering the interest rate.

The restructuring of a loan happens through the Corporate Debt Restructuring(CDR) cell. The Goldman Sachs analysts point out in their report that 85% of restructured loans were restructured during the last two years (i.e. financial year 2011-2012 and 2012-2013).
What makes the situation even more precarious is the fact that the stressed loans could keep increasing. Goldman Sachs projects that among the banks its research team covers stressed loans could go up by as much as 25% in 2013-2014 (i.e. the period between April 1, 2013 and March 31, 2014). Also, some of the troubled loans have still not been restructured or classified as bad loans by banks. Hence, the situation is worse than what the numbers tell us.

As Akash Prakash of Amansa Capital wrote in a recent column in the Business Standard “Most investors believe that many of the problem assets are yet to be recognised by the system. These banks continue to increase their exposure to the problem areas of power and infrastructure.”

Five sectors, namely, Infrastructure, Iron & Steel, Textiles, Aviation and Mining, have the highest level of stressed advances. “At system level, these five sectors together contribute around 24 percent of total advances of SCBs [scheduled commercial banks], and account for around 51 percent of their total stressed advances...The share of above mentioned five sectors in the loans portfolio of Public Sector Banks,” the RBI Financial Stability Report points out. Hence, the public sector banks are in greater trouble than their private counterparts.

Of the five sectors the infrastructure sector has contributed around 30% of the total stressed assets even though its share of total loans is only about 15%.

The banks have also not been provisioning enough money against stressed loans. “Moreover, provisions for stressed assets are still low, and the lowest in the region. For public-sector banks under its coverage, our Financials Research team assesses the provision coverage ratio for stressed loans at only 24%,” write Poddar and Vaibhav.

What this means is that the banks are not setting aside enough money to deal with prospect of a greater amount of their stressed loans being defaulted on by borrowers and turning into bad loans. And to that extent, banks have been over-declaring profits. That wouldn't have been the case if they had not been under-provisioning.

Despite the under-provisioning the capital adequacy ratio of banks has fallen dramatically in the recent past. “The Capital to Risk Weighted Assets Ratio (CRAR) at system level declined to 12.7 per cent as at end September 2013 from 13.8 percent in as at end March 2013...At bank-group level, PSBs recorded the lowest CRAR at 11.2 per cent,” the RBI Financial Stability Report points out. In fact, since September 30, the capital adequacy ratio of the entire banking system would have fallen even more, given that bad loans have gone up. The capital adequacy ratio of a bank is the total capital of the bank divided by its risk weighted assets.

In the days to come, the banks, particularly public sector banks (given their falling capital adequacy ratio), will have to raise more capital to have a greater buffer against the mounting bad loans. The RBI estimated in late 2012 that banks need to raise around $26-28 billion (or around Rs 1,61,200 crore – Rs 1,73, 600 crore, if one dollar equals Rs 62) by 2018.

This is a huge amount. “The capital raising requirement could increase to US$43bn [Rs 2,66,600 crore] under a stress scenario where gross NPLs[non performing loans] and restructured assets rise to 15% of loans, the previous historical high,” estimates Goldman Sachs.

So where is this money going to come from? For the financial year 2014-2015 (i.e. the period between April 1, 2014 and March 31, 2015). the finance minister P Chidambaram has set aside only Rs 11,200 crore for capital infusion into public sector banks. This is simply not enough.

So should government pump in more money into the banks? It simply doesn't have the capacity to do so. As Akash Prakash writes “There is no way the government can fund this; there is simply no fiscal capacity. Nor do investors want to stand in front of this freight train, since the capital needs for most banks are greater than their current market capitalisation.”

Let's take the case of the United Bank of India. The current market capitalisation of the bank is around Rs 1442 crore(assuming a share price of Rs 26). The government has decided to pump in Rs 800 crore into the bank. Given that, the market capitalisation of the bank is around Rs 1442 crore, which private investor would have been ready to pump in Rs 800 crore? Also, when the State Bank of India tried to sell shares worth Rs 9,600 crore to institutional investors recently, it failed to raise the targeted amount and had to be rescued with the Life Insurance Corporation pitching in and picking up its shares.

If the biggest public sector bank in the country, which accounts for nearly 20% of Indian banking, is unable to sell its shares completely, what is the chance for other public sector banks being able to do so?

Given these reasons, Indian banking is in for a tough time ahead. Fasten your seatbelts.

Asset reconstruction at crossroads

Illustration by Jayachandran/Mint

Live Mint  Ranjan Bakshi FEB 25 2014. 08 07 PM

Traditional asset reconstruction companies are facing stiff competition from vulture funds in an open market

It’s been a long time coming, but the Reserve Bank of India’s (RBI’s) latest pronouncements in the Framework for Revitalizing Distressed Assets in the Economy, issued in January, is finally beginning to set the asset reconstruction companies (ARCs) conundrum in perspective. The central bank has moved decisively on mechanisms for early detection and redressal of stress in the financial system, but ARCs have been neglected for a long time. RBI has finally woken up to this struggling infant, but in trying to make amends, has it inadvertently penned its requiem?

Over the years, watchful regulators across the world have struggled to mop the party floor after nights of excessive credit binges. Developed economies such as the US and UK have developed a well honed legislative and regulatory regime seamlessly operating with its financial system and creating a healthy market for high yields. ARCs in India were set up at the turn of the century against the backdrop of the Asian meltdown and the dotcom bust. Recalcitrant borrowers reneged with impunity as banks whistled for their money. Gross non-performing assets (NPAs) of public sector banks hovered at an alarming 16%. The long overdue Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (Sarfaesi) Act heralded seminal changes by providing much needed succour to banks reeling under an unresponsive and overburdened legal system. However, not content with handing the banks a stick to beat defaulters with, RBI decided to go the extra yard. It, very sensibly, handed out seven ARC licences.

The recorded tale of ARCs has since been a litany of woes. The deputy governor of RBI, in his address to BANCON in July 2013, lamented the reluctance of the banks to part with their NPAs and noted that divestments were down from Rs.13,000 crore in 2008 to Rs.6,000 crore in 2012. Gentle prodding is now beginning to take on ominous overtones as RBI is clearly not amused. NPA pricing has become a perpetual bone of contention between the banks and ARCs. Against global averages of between 10-20 cents, current Indian auctions clear well over 40 cents. Barring Asset Reconstruction Company (India) Ltd (Arcil), which has big boys as sponsors, most ARCs continue to be fledglings, grateful for whatever crumbs come their way. Universal application of Sarfaesi Act provisions to all banks was a long overdue necessity. However, imagine for a moment if the Sarfaesi Act were restricted to ARCs alone. Suddenly they would’ve taken on a whole new meaning with clear differentiation between where banks left off and ARCs stepped in. Creating specialized agencies without exclusive powers and instead placing them on par with banks wasn’t quite designed to secure their niche. Unfortunately that is all in the realm of conjecture now and banks today cannot be faulted for questioning the value added by ARCs to the resolution process. In short, what can ARCs do that the banks cannot; more so, if resolution skills are seen to be restricted to mere asset stripping? Viewed in this light, the bank’s reluctance to part with assets to ARCs at deep discounts becomes apparent.

Unlike developed markets, where term financing has primarily been via public issuance of bonds and debentures, term debt in India has historically been the sole preserve of banks and financial institutions. Asset accretion driven balance sheet building inhibits secondary trading of debt. This, in turn, inhibits transparent price discovery. A host of operational issues continued to dog the industry’s faltering steps. Tackling wilful defaulters without the power to change managements or take board room control was akin to entering a mortal combat with one arm firmly tied behind your back. Raising equity and funding was severely constrained by caps on foreign institutional investor participation. This left out the larger international fund managers with the requisite know-how and appetite to contribute effectively to the resolution effort. The passage of the Enforcement of Security Interest and Recovery of Debts Laws (Amendment) Bill, 2011, has attempted to plug these loopholes. While allowing ARCs to convert debt to equity, it not only established the primacy of ARCs but additionally provided meaningful exit options to beleaguered investors in distressed assets. Ability to acquire underlying securities insured ARCs against distress sales and reduction of consent of lenders to 60% of total borrowings has provided some relief against the merry-go-round called aggregation.

But RBI has now gone a step further. In its press release of 30 January, the central bank seems to suggest now that the playing field has been levelled; it is time to open up the market. In slow measured steps it has now permitted private equity funds/non-banking finance companies to participate in auctions by banks. Sarfaesi protection will, ipso facto, be made available to these entities for resolving the auctioned cases and also for resolving their own NPAs.

ARCs are now up against a far more formidable challenge than an apathetic regulatory regime. These distressed asset/vulture funds are not licensed ARCs with a limited mandate to negotiate purchases from banks. They are free birds with choice of assets, diversified revenue streams, deep expertise and large pools of funding. This is as it should have been from the outset—Sarfaesi applicable to all and NPA resolution open to anyone with the requisite resources. So, whither ARCs? Will they, like an appendix, be reduced to footnotes or will they reinvent themselves to stay relevant and morph into the very funds they now feel threatened by.

Ranjan Bakshi is a risk specialist in private equity and was earlier managing director of hedge fund Strategic Value Partners and Deutsche Bank’s distressed assets business in Europe. 

Government raises stake to bail out United Bank

Tuesday, 25 February 2014 - 6:00am IST | Place: Mumbai | Agency: DNA

Putting market speculation of United Bank of India's (UBoI) merger with Union Bank of India at rest, UBoI has converted Rs 800 crore of bonds issued by the government into equity shares of Rs 10 each and another allotment of Rs 110 crore equity shares of Rs 10 each at a possible premia.

The bank on Monday informed the Bombay Stock Exchange that its board approved conversion of Rs 800 crore of perpetual non-convertible preference shares (PNCPS) into equities and another issuance of Rs 110 crore of equity shares at a price yet to be decided to the government of India.

This, in effect, means the bank is still in the red, but has got a face-saving from insolvency as any follow-on public offer would have failed to evoke any response, bankers said.

Such perpetual bonds -- which were non-convertible till the UBoI's recent board approval – were issued by the government to its own banks to shore up Tier-I capital and improve capital adequacy. This is nothing but a financial jugglery of the government.

Typically, the government issues bonds to banks as it cannot issue equities but can only subscribe to them (shares) because it is not a company. These banks (the government-owned ones) then subscribe to the bonds, hence raising funds for the government. The government then re-directs the funds to the banks by subscribing to latter' new series of shares. Government banks are hence self-funding its own capital.

With the Basel III norms being implemented from April 2013, banks can no more classify perpetual bonds under Tier-I capital hence the government move to convert these (perpetual) bonds into equities now, senior bankers said.

The board's decision saw the share price of UBoI appreciating 5.94% to Rs 25.85 from its previous close of Rs 24.40.

The larger picture is still gloomy unless it shows sure signs of recovering its bad debts, which stand at Rs 8,546 crore, or 10.82% of its net advances. The losses in the second and third quarters were Rs 489 crore and Rs 1,238 crore, respectively, forcing the Reserve Bank of India to issue a cap of Rs 10 crore on loans to any single borrower account.

The latest move to convert bonds into equities has made the risk capital for the bank better. However, going by the norms laid out by the regulator, Securities Exchange Board of India (Sebi), the bank has been long due for de-listing. Going by the continuous listing norms of Sebi, promoter-holding should never exceed 75%, or in other words 25% of the shares should be available to non-promoters and public. If it does exceed the stipulated limit, then either promoters should sell their shares in the open market or get the company de-listed.

In the case of UBoI, the promoter, which is the government of India, has flouted its own rules initiated by the current President Pranab Mukherjee, then a finance minister, in his budget speech of 2009-10.

UBoI which was listed in February 2010 has always had government holding above 80%. The government currently enjoys 88% holding in the company, and with the new board approval the holding could well go over 90%, estimate bankers.

Cock fight dens refuse to accept pre-2005 notes

Stanley Pinto, TNN | Feb 24, 2014, 12.28PM IST

MANGALORE: The Reserve Bank's decision to withdraw all currency notes issued prior to 2005, including Rs 500 and Rs 1,000 denominations, after March 31, has had dual effect - panic in some sections and mitigation of Rs 5 shortage in other.

Though the central bank has urged the public not to panic and to actively co-operate in the withdrawal process'', panic has already set in in some of the unlikeliest sectors. Recently a customer called the Barke police saying the currency notes which he withdrew from an ATM on MG Road were fake.

The police asked him to come to the station and lodge a complaint the next day. But the person realized his folly that the currency notes were genuine but were issued prior to 2005. The bank manager also confirmed this and the person did not lodge a complaint.

The difference between pre- and post-2005 currency notes is the latter have the year of printing on the reverse. The year of printing in a small font is visible at the middle of the bottom row in notes issued after 2005.

More interesting is the local kori katta (cock fight) gambling dens refusing to accept currency notes issued before 2005. Kori kattas are places where lakhs of rupees are exchanged in betting in one single night. Having notes which will be withdrawn from circulation from April 1 would mean the currency notes which will never reach the bank have no value,'' said a patron of the cock fight.

But there has been positive impact too: Rs 5 shortage, which has been a perennial problem here, has been a thing of the past since pre-2005 Rs 5 currency notes have flooded the market. GG Mohandas Prabhu, former president, Kanara Chamber of Commerce and Industry and a trader in Bunder, said: "We have been receiving mint-fresh Rs 5 pre-2005 currency notes in large quantities. Those who have hoarded them are releasing them into the market. Since we deposit daily transactions at banks, we will not have problem with pre-2005 notes barring those who plan to hoard them,'' he said.

Kudpi Jagadeesh Shenoy, president, Dakshina Kannada District Hotel Owners' Association, said though his establishment has not received Rs 5 notes like in Bunder area, the shortage has been mitigated due to the RBI releasing enough coins of late. On whether hotels are refusing to accept pre-2005 notes, he said: "We prefer post-2005 currency notes. But we do not refuse pre-2005 either.''

TAKE NOTE

After March 31, 2014, RBI will completely withdraw from circulation all bank notes issued prior to 2005.

From April 1, public will be required to approach banks for exchanging these notes.

From July 1, persons seeking exchange of more than 10 pieces of Rs 500 and Rs 1,000 notes will have to furnish proof of identity and residence to the bank.

Powerful Quotes of Steve Jobs : Dont let the noise of others' opinion drawn out of your own Inner Voice............

Powerful Quotes of Steve Jobs  : 
Dont let the noise of others' opinion drawn out of your own Inner Voice............

The Spirit of Warren Buffett : Money, to some extent, sometimes lets you be in more interesting environment. But it cnt change how many people ove you or how healthy you are .

Quotes :

  "Money, to some extent, sometimes lets you be in more interesting environment. 
But it cnt change how many people ove you or how healthy you are ."

The Times of Warren Buffett :

Style

Buffett's speeches are known for mixing business discussions with attempts at humor. 

Each year, Buffett presides over Berkshire Hathaway's annual shareholder meeting in the Qwest Center in Omaha, Nebraska, an event drawing over 20,000 visitors from both United States and abroad, giving it the nickname "Woodstock of Capitalism".Berkshire's annual reports and letters to shareholders, prepared by Buffett, frequently receive coverage by the financial media.

 Buffett's writings are known for containing quotations from sources as ranging between the Bible and Mae West,as well as advice in a Midwestern folk style, and numerous jokes.

Books on warren Buffett :

Author : Jeff Mathews

NPAs a Systemic Risk to Indian Banking

B L  :20 Feb 14

The United Bank episode suggests that the RBI has been correct in pressing banks to come clean about their NPAs

It would be alarmist to suggest that the crisis at United Bank of India, where escalating bad loans have raised questions of viability, poses a systemic risk to Indian banking. With just a 1 per cent share in total deposits, the bank is a small regional player. 

And its non-performing assets have arisen, not from large corporate borrowers as for most other banks, but from minuscule sub-₹10 lakh loans extended to farmers and small enterprises. The NPAs, at 10.8 per cent of loans reported by the bank, are also exceptionally high, at twice the level for other public sector banks. 

The problems have also been known for some time. Statutory auditors have been re-examining the bank’s books since last year and RBI had ordered a forensic audit after it reported large losses in the September 2013 quarter.

But the prospect of United Bank defaulting on its subordinated debt and falling short of capital still needs to be viewed seriously both by RBI and the government. 

Any whiff of trouble at a public sector bank shakes depositor confidence in the entire banking system. How the government and RBI deal with this case will also set a precedent for other public sector banks which are in dire need of capital, albeit for different reasons. Basel III norms, which became effective from April 2013, are set to impose onerous obligations on banks over the next couple of years.

 Rising NPAs at United Bank have seen its Tier I capital adequacy ratio falling below the statutory requirement of 6.5 per cent. While no other public sector bank is today in the same boat as United Bank, there are a few (for instance, Union Bank, Central Bank, UCO Bank and Dena Bank) whose ratios are way below the comfort level of 8 per cent.

 A rapid rise in their NPAs could push them to the brink.

As for United Bank, while some deterioration in asset quality is expected during a downturn, the problems that have come to light in the lending practices and NPA detection systems raise questions about its approach to the business. 

If the problem as the bank claims lies not so much with bad loans but ‘faulty software’, then how is it that the same software has not thrown up similar ‘deficiencies’ when deployed in other Indian banks? The RBI has been quite right in repeatedly pressuring public sector banks to come clean with their NPAs.

 It is good that the regulator’s new rules asking banks to put early-warning systems in place to detect slippages ahead of the 90-day cut-off, share information between themselves and take joint action against defaulting borrowers, will come into effect this April.

 However, this episode also highlights that computer-based systems alone cannot ensure good lending practices. Enforcing greater accountability on the top managements of public sector banks for massive slippages is also necessary.

 Right now, the short tenures of 1-3 years for public sector bank chiefs discourages them from taking prompt remedial action. Re-examining the manner in which they are appointed may also be key to preventing a repeat of NPA scares like this one.

United Bank of India deserves a lifeline

Mohan R Lavi : BL 23 Feb 14

Once new banks enter the fray, they might want to pick up UBI for its network

The “too big to fail” theory — invented in the US — asserts that certain financial institutions are so large and interconnected that their failure would be disastrous for the economy, and therefore must be supported by government when they run into trouble.

Going by recent developments at the United Bank of India (UBI), it appears that India would soon invent a “too small to rescue” theory. There are reports that the Government is not planning to rescue the bank — which invariably means allowing it to merge with another bank. This is different from the Government strategy thus far — Nedungadi Bank, Global Trust Bank and Bank of Rajasthan all fell into the arms of other banks.

With the elections round the corner, rescuing a struggling bank would be last on the wish-list of any political party. UBI has about 2,000 branches, 35 regional offices and an existing employee head-count in excess of 17,300.

The fragile nature of the assets on the banks balance-sheet was noticed a few months ago. The RBI in December 2013 had restrained UBI from advancing credit of more than ₹10 crore to a single borrower and also restricted it from restructuring stressed assets, after conducting a forensic audit in November.

NPA situation

The bank reported a net loss of more than ₹1,200 crore in the December quarter. The ratio of gross non-performing assets (NPAs) to gross advances during the third quarter of the current financial year jumped to 10.82 per cent to ₹8,545.50 crore. United Bank of India was struggling to meet the barometer of every bank’s financial health — the capital adequacy ratio of 9 per cent. The bank decided to suspend its loan facilities for an indefinite period owing to high levels of stressed assets and diminished capital adequacy. During the quarter ending December 31, 2013, the bank made an entry for provisions and contingencies of ₹1857.83 crore, which was nearly double the amount it entered for the immediately preceding quarter. The bank has on its shelf ₹5,524 crore as restructured loans, out of which ₹4,815 crore are loans to large corporate accounts.

The UBI seems to have been hit the most in what is turning out to be the scourge of the banking industry — non-performing assets. The comparatively small size of the bank's operations should have made it extra prudent in its lending portfolio.

But what is banking without inherent risk — the bets the bank placed on certain large borrowers seem to have ricocheted back on it. The NPA syndrome has hit other banks too; it is just that they seem to have the financial muscle to take it in their stride.

New licences

Coincidentally, the issue has arisen at a time when the RBI is in the last phase of issuing new bank licences. Some of these contenders would be keen to look at the positives the bank has — a nation-wide network, established infrastructure and knowledgeable employees.

The Government should allow the bank to run by providing the funds needed till the new licences are issued and banks are up and running. The RBI and the Government should decide to shut down the UBI only as the last resort.

(The writer is Director, Finance, Ellucian)

The Spirit of Warren Buffett : ".......Energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks. "

Quotes :
 ".......Energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks. "

The Times of Warren Buffett :

Writings

Warren Buffett's writings include his annual reports and various articles. Buffett is recognized by communicators as a great story-teller, as evidenced by his annual letters to shareholders. He warned about the pernicious effects of inflation:

The arithmetic makes it plain that inflation is a far more devastating tax than anything that has been enacted by our legislatures. The inflation tax has a fantastic ability to simply consume capital. It makes no difference to a widow with her savings in a 5 percent passbook account whether she pays 100 percent income tax on her interest income during a period of zero inflation, or pays no income taxes during years of 5 percent inflation.

—Buffett, Fortune (1977)

In his article "The Superinvestors of Graham-and-Doddsville", Buffett rebutted the academic Efficient-market hypothesis, that beating theS&P 500 was "pure chance", by highlighting the results achieved by a number of students of the Graham and Dodd value investing school of thought. In addition to himself, Buffett named Walter J. Schloss, Tom Knapp, Ed Anderson (Tweedy, Brown Inc.), William J. Ruane(Sequoia Fund, Inc.), Charles Munger (Buffett's own business partner at Berkshire), Rick Guerin (Pacific Partners, Ltd.), and Stan Perlmeter (Perlmeter Investments).In his November 1999 Fortune article, he warned of investors' unrealistic expectations:

Let me summarize what I've been saying about the stock market: I think it's very hard to come up with a persuasive case that equities will over the next 17 years perform anything like—anything like—they've performed in the past 17. If I had to pick the most probable return, from appreciation and dividends combined, that investors in aggregate—repeat, aggregate—would earn in a world of constant interest rates, 2% inflation, and those ever hurtful frictional costs, it would be 6%!

—Buffett, Fortune (1999)

Books on warren Buffett :



Author : Robert P. Miles
Publisher :John Wiley and Sons [March 2004],

Powerful Quotes of Steve Jobs :, Life is about creating and living experiences that are worth sharing.

Powerful Quotes of Steve Jobs  :
"Life is about creating and living experiences
 that are worth sharing."

United Bank CMD, who blew lid over NPAs, resigns

• Archana Bhargava

Saturday, February 22, 2014 - 06:00 IST | Place: Kolkata | Agency: DNA

United Bank of India's chairperson and managing director Archana Bhargava has resigned, almost a year ahead of the end of her tenure amid growing concerns over sharp rise in its non-performing assets in recent times and apprehensions that there were serious lapses in its detection and reporting in the books over the years.

''Ministry of Finance vide its letter dated February 21 has communicated its acceptance to the application for voluntary retirement of Archana Bhargava. In absence of chairman and managing director both the executive directors shall jointly remain in charge of the bank till such time that a regular incumbent takes over the charge of CMD," the Kolkata-headquartered bank said in a statement.

Bhargava's exit, curiously, is being seen by a section of the banking circle as a precursor to fulfilment of her political ambition -- she is speculated to be emerging as a Congress candidate in the forming Lok Sabha polls -- and not entirely influenced by the current state of affairs at the bank.

While is has been revealed post a forensic audit by Deloitte that there was systematic flaws in United Bank's NPA detection mechanism for years, the shooting up of dud assets since the second quarter in the books coincided with Bhargava's entry as the CMD in April, which means she was responsible not for generation of the NPAs but their exposure.

In fact, her insistence in revealing NPAs proactively didn't go down well with senior management, sources said. ''There were differences in opinion between the CMD and the GMs in the way she was managing the affairs," a person in the know said.

The current crisis in UBI erupted in end of September quarter with sharp rise in NPAs to 7.52% at gross level from 4.25% as on March-end, which along with an increase in cost of funds led to a significant drop in its core profitability. Also, despite the bank creating higher credit provisions in the first half, solvency profile (net NPA as a ratio of net worth) worsened to 109% by September from 44% in March.
Then in December quarter, NPAs again shot up to 16.4% in Q3, and the bank reported a loss of Rs 1,238 crore while capital adequacy dropped to 9.01% as against 9.48% in September and solvency further worsening to an alarming 162%.

This led successive downgrading of UBI's lower tier 2 bond rating by Icra from AA to AA- and then again to A- over the two quarters.

The Reserve Bank of India (RBI) then asked UBI to virtually stop lending activity while the finance ministry appointed Deloitte to carry out a forensic audit which is believed to have detected serious lapse in NPA detection.

The government, for the time being, has prevented the crisis from triggering a panic among UBI's customers by pumping in Rs 1,000 crore of tier 1 capital.

Yet, for the old timers in UBI's Kolkata headquarters, it's a sense of déjà vu, bringing back memories of 1996-97, when UBI, along with another city-based bank UCO and Indian Bank collectively turned 'weak banks' when Verma Committee was formed to detect systematic weaknesses in them.

A study of the report, however, shows much of the lessons learnt then have gone in vain with little efforts made to overcome the shortcomings.

"The malady has been deep in the case of three banks. Continuous decline in profitability and efficiency of these banks and their dependence on capital support from government are causes for concern. They are trapped in a vicious circle of declining capability to attract good business and increasing need for capital support. There is also the question of concentration of branches in specific areas with which United Bank of India and UCO Bank are faced. There is an urgent need to consider rationalisation of branches in all the three weak banks," the report said.

While flawed strategy of capital infusion to get over systematic inefficiency is still being followed, UBI has now admitted that part of the current trouble stems from its concentration of its branches in east and north-eastern parts of the country, a flawed feature which the committee had pointed out way back in 1999.

Citibank rules out India subsidiary, informs RBI

 B S  :Manojit Saha & Somasroy Chakraborty  |  Mumbai / Kolkata  February 22, 2014 Last Updated at 00:58 IST


Major setback to RBI's ambition of making foreign banks convert their branches into subsidiaries


Citibank has ruled out setting up a subsidiary in India and has officially informed the Reserve Bank of India about its decision.

The banking regulator was hoping to convince a few foreign banks to operate in India through wholly-owned subsidiaries (WOSes). But, according to people familiar with the development, Citibank recently wrote to RBI saying it had no plans to establish a WOS in India at this point.

The central bank’s initial effort to persuade foreign lenders to convert their branches into subsidiaries (between March 2005 and March 2009) for better regulatory oversight had failed due to absence of adequate incentives. However, this time, in its new subsidiarisation norms released in November 2013, RBI promised near-national treatment to foreign banks that opted for a subsidiary mode of presence.

Though most foreign banks appear reluctant to establish a subsidiary here, Citi is the only bank that has so far communicated this to the regulator, in writing. The bank’s desire not to set up a WOS in India was mentioned in its recent periodic report to RBI.

Citi confirmed it had no plans to convert its India branches into a subsidiary. “At this point, Citi does not have plans to establish a local subsidiary,” a spokesperson for Citi told Business Standard in an e-mail.

Bankers felt the reciprocity clause in RBI’s guidelines probably deterred Citi from opting for a subsidiary mode of presence. According to the new norms, foreign banks will be given unfettered branch access in India after establishing a WOS, provided their home countries allow Indian lenders to open branches without much restrictions.

“Indian banks are not allowed to expand networks freely in the US. Citi, being a US-based bank, would have found it difficult to convince the regulator in getting a near-national treatment in branch expansion here,” said a banker who did not wish to be named.

Sources said uncertainty on stamp duty and certain areas of taxation, and the need for rural presence might also have influenced Citi’s decision.

Bankers also pointed out that RBI had not made subsidiarisation mandatory for foreign banks that entered India before August 2010, leaving to many of them, including Citi, the option of not creating a WOS in India. According to RBI data, Citi opened its first branch in India in 1963. It currently has 42 branches across the country and three unused branch licences.

Hurdles for foreign banks in creating WOSes

* Near-national treatment in branch expansion not guaranteed due to reciprocity clause

* Need to have significant presence in rural/unbanked regions

* Lack of clarity on tax sops, stamp duty relaxation