Anon 2:10 pm posted this comment.
'India CECA News:
Is Singapore's DBS Being Forced by India to Inject Capital Into Troubled Indian Bank?....
Given the “ absence of any credible plan for infusion of capital ”, therefore, the amalgamation with DBS Bank India is necessary in the name of “(Indian) public interest and particularly in the interest of the (Indian)depositors,” RBI notes.
According
to DBS, it will inject INR 2,500 crore ($463 million) into DBS Bank
India if the scheme goes through. This will be fully funded from DBS’
existing resources.
“The proposed amalgamation will provide
stability and better prospects to Lakshmi Vilas Bank’s depositors,
customers and employees following a time of uncertainty,” says DBS.
Below is from The Economic Times of India
'DBS is well-known for its culture of efficiency. We can keep our
fingers crossed on how that will fit in with the culture of the old private sector bank, says R Gandhi, Former Deputy Governor, RBI.
It was expected that a public sector bank would step in down and save Lakshmi Vilas Bank NSE -19.94 %. The RBI has put out a draft amalgamation scheme with DBS India as the possible bank that will take over. Any comments on the choice of DBS India?
First of all, there has been a long standing expectation from the market and others that whenever there is a problem in a bank, the public sector should come to the rescue. It is good that the premise is gone. Whether the market likes this arrangement, whether it is a public sector or a private sector or a foreign bank that should not be the criteria. The bank which will be able to take over the failing bank and which can bring in additional capital should be the primary consideration. That has been demonstrated and that is good for the future. The normal expectation that a PSU bank should always come to the rescue whenever a bank fails is gone and that is a first. Number two, whether there will be a cultural fit or not is a natural question people will entertain because DBS is well-known for its culture of efficiency. We can keep our fingers crossed on how that will fit in with the culture of the old private sector bank but that would also have been factored in by DBS. This is a local bank now, it is a subsidiary of DBS, it is not DBS per se.'
A few pertinent questions. Why is DBS India bailing out a failing Indian bank. 2. What is it in for DBS? 3. Is DBS doing charity? 4. What is the return for the $463m paid? 5. Who is this $463m paid to? 6. In addition DBS India would have to pay the depositors what they deposited. How much would this be and is it in addition to the $463m? 7. What would be the full sum that DBS India would have to pay eventually? 8. Does DBS has a choice to say no? 9. Presumably the Singapore govt was consulted and agreed to it?
In the last sentence above in bold was added by me. What does it mean that DBS is a local bank now and not DBS per se?
What is going on? Anyone able to clarify what is going on? Is DBS India now own by the Indian govt and the Indian govt can order DBS India, a bank owned by Singapore, to bail out failing Indian bank?
As an analogy, supposing a local Singapore bank is failing, can the Singapore govt order a foreign bank like an American or European bank to bail out the bank?
livemint.com reported this,
'The equity holders of Lakshmi Vilas Bank will find their value written down to nil. “On and from the Appointed date, the entire amount of the paid-up share capital and reserves and surplus, including the balances in the share/securities premium account of the transferor bank, shall stand written off," the RBI said. The fact that the bank had a negative networth would mean that shareholders do not stand a chance to make money.
DBS India will pay depositors of Lakshmi Vilas Bank fully if they do not wish to continue to remain with the lender post merger. Employees too are expected to be swallowed completely by DBS Bank India without big layoffs.'
Is DBS India doing national service for India or is this a commercial decision whereby DBS will gain or benefit somewhat in the long run? Or is it money down the drain?
Is it Christmas in India?
Anon 2:53pm said, 'Effectively, the India government is getting a foreign investor to bail out a local financial institution which is in trouble - to protect Indian depositors - instead of using taxpayers' money as was done in Western countries.
Why not save Hyflux and protect the uncles and aunties minority shareholders who would have lost their life savings or a big chunk of their little savings?
48 comments:
"What does it mean that DBS(I) is a local bank now and not DBS per se? "
It is a REVERSE TAKEOVER by LVB lah !
Who is responsible if Sin City becomes a colony of India?
Spending OPM is fun, no responsibility. Sinkies don't know what is happening, did not want to know.
After being told they are daft for so many years, they have lost the confidence to think otherwise and believed that they are daft and foreigners are the smart and talented ones.
They don't even know that Singapore is their country and it is ok to give it to foreigners. Come, come, please take it.
Reverse takeover? When is the name change to Lakshimi Vilas Bank?
Something is amiss.
Something is fishy.
Considering an ex-India National is now controlling DBS as CEO.
And also considering another ex-India National is controlling MAS.
This does not look good.
I am getting very suspicious.
My sixth sense (intuitive cognition) and seventh sense (claivoyance) tell me than somebody is going to make a kill to benefit very bigly behind the facet.
It is not logical. Not rational thinking. It is a blind irrational big gamble.
No feasibility study - too rush to complete a proper feasibility study.
It could be again a Negligence in Fiduciary duty and responsibility like in the case of Thailand's SinCorp.
Everything just doesn't add up. Something crucial in the decision-making is hidden from the public.
DBS management and the MAS has to come clean with full exposure of the details before actual commitment is made.
Singapore leaders are getting too close to India for Singaporeans own good. There has to be a check and balance. At present there is none.
Singapore Today: The Faultless Human Errors
It has been proudly, gloriously and openly reported in the news that about 3,000 public service officers, both past and present, have been short-changed for a total of about $10 million because of HUMAN ERRORS.
"About 3,000 public service officers past and present will be compensated with a total of around S$10 million after errors were found in the Civil Service’s human resource (HR) records, the Public Service Division (PSD) said on Wednesday (Nov 18).
“The errors arose primarily because of human errors in data entry and coding of the HR and payroll IT systems,” PSD said. “The IT systems also had inadequate error detection capabilities.”
Isn't this is a clear, distinct and outstanding example of carelessness, incompetence and complacency?
Some top people are very fond of saying, "If you pay peanuts, you get monkeys." According Mrs Goh Chok Tong's standard, one peanut is equivalent to $60,000. Then what we get when ministers and top civil servants are paid 20 to 30 peanuts?
You are bound to get very lazy monkeys, because they have been too well fed. They over-eat the peanuts and grow so fat until they become huge orang-utans. So much so they can't move easily, become not agile anymore. Ultimately, complacency and incompetence set in, over the long years of service, and long years in power.
In the past, especially during the very strict, no-nonsense LKY-GKS Administration, we very seldom heard of HUMAN ERRORS being glorified as an excuse for big cock-ups like this one. Why?
Because heads would roll the moment the slightest display of complacency or incompetence
is uncovered. Not the lower rungs' heads. But the head who sits right at the top of the ministry or statutory board.
Basically, what does Human Errors mean? Isn't it as good as saying some human beings have been careless?
What causes carelessness? Isn't it caused by complacency?
What causes complacency? Isn't it due to incompetence?
What causes incompetence? Is it because of having been promoted to the level of incompetence, coupled with too much pay? Too-good-to-be-true type of pay? Instant millionaire pay? Out-of-this-world pay? Unconscionable pay?
Nobody is to be blamed. Cannot blame the humans who have HUMAN ERRORS because nobody is perfect. Everyone is bound to make mistakes. Everyone is entitled to make mistakes, especially when you are part of the Elite Entitlement Culture (EEC). So now blame who/what?
Hey, presto! Blame it on the IT system! Machines cannot fight back. So easy and convenient. Who don't know? But, but, but wait a minute. WHO approved the lousy, cock-up, blame-worthy IT system in the first place?
The IT System is not good enough because the person or committee that approved the IT System is not good enough. Simple as that. He/she/they are prone to HUMAN ERRORS. He/she/they have HUMAN ERRORS!
All civil servants are ENTITLED TO HAVE HUMAN ERRORS. So cannot fault them. It is not their fault that they have become so complacent, so careless, so incompetent that they now possess full of HUMAN ERRORS. It is because they have been paid out of this world unconscionable $million salaries to reach Multi-millionaire Status easily that they now take things easy so that they have so many Human Errors. It is not their fault that they are paid such obscene salary. Somebody else volunteered to pay them such obscene salary, plus even more obscene annual bonuses.
HUMAN ERRORS are faultless. It is honest mistakes because there is no such thing as dishonest mistake. If it is dishonest, the it cannot be mistakes; it would be deliberate, premeditated manipulations. Simple as that.
Is that loud and clear?
Another reverse takeover? DBI to reverse takeover DBS?
Re: SSO
Did Goh Chok Tong's wife said one peanut is equivalent to $60,000.00 or $600,000.00.
If I am not mistaken she said $600,000.00 and not $60,000.00 salary per month paid to that black ant crook and scoundrel CEO of Kidney's Dialysis Foundation is just a peanut.
And now with DBS in black ants land Singapore is finished.
DBS is being asked to do a clean-up role in India. Can DBS don't comply?
This integration will prove a distraction at a time when the DBS group is dealing with containing risks from the ongoing COVID disruption.
Although ST's Ven Sreenivasan tries to put a positive spin on the amalgamation - that it would significantly increase DBS' footprint in India - analysts said the S$463m to be injected represents 1% of DBS group equity and 0.14% of CET-1, and is equivalent to 19% of DBS' 9 months loan provision expenses. The main potential benefit of scaling up the branch network from 27 to 590 post transaction is offset by the asset clean up ahead with the combined group in India having an estimated 10% non-performing asset ratio post-merger, analysts said.
It is wise,safer and advisable for Singaporeans to put their money in UOB and OCBC banks.
Singaporeans should for their own peace of mind withdraw whatever savings they have with DBS and transfer them to UOB and OCBC banks for safe keeping.
It is very scary what is happening in DBS now.
Due diligence is a serious matter. Can anyone remember the debacle and the billions lost when failed American banks came asking for help? After the fiasco the issue of due diligence was raised.
In this bailout, was due diligence done, were there sufficient time to do a proper due diligence before dumping $463m into a failed Indian Bank and how much more would be needed to pay the depositors, and would there be hidden debt to be paid?
Hope DBI would not be tank by this impetuous bailout, not sure if DBI was given a choice or a no choice option, bailout or get out?
Would DBI grow too big in terms of client base and as said, becomes a big local bank?
If this is so, a hypothetical situation could develop, knowing India's track record, to nationalise DBI. Then what?
It would be another case of lan lan, just accept it. What are the political risk that this could happen? Any provision or negotiation that this would not happen?
Correction:
According to Ms Goh Chok Tong, one peanut is equivalent to $600,000 and not $60,000.
My apologies.
Hahaha....
We have a lot of $$$$$$$$$$$$$$$$$$$$$$$$$!
Hahaha......
DBS
should be making tons of profit in lndia with the Worlds' Second Largest Population.
DBS as the Largest Bank in SE Asia, cannot be as gullible as some perceive it.
Gupta, the CEO of DBS Bank must be working very very hard to benefit the Sin Bank.
Cheers.
If DBS could not make big profits in China, with the World's Largest Population, what makes DBS able to make tons of profits in India?
Merely being the Largest Bank in SE Asia means it cannot be as guilble as some perceive it to be? What logic is this? What has being the Largest Bank in SE Asia got to do with being gullible or not?
May be being the Largest reflects it is being the greediest. The greed of a person or organisation is the main culprit that cause that person or organisation to take higher and higher risks. There are numerous ample examples of people being conned in broad daylight because of greed.
Gupta, working very very hard or not does not necessarily mean his efforts will benefit Singapore and Singaporeans. It could also be beneficial to himself and his fatherland.
The Indians are godsent to save all the banks in the world, especially Sin banks. See how they helped to build all the banks into such big banks, except in India of course. Without Gupta DBS probably in shit now or cannot be the best bank in the world.
The next step is to put two Indian chiefs to take over UOB and OCBC, then they can become as big as DBS.
The next right step for Singapore and Singaporeans should be to put 12 Indian chiefs to replace the Singapore PM and his Cabinet, then Singapore can become as big and powerful as India.
lndia does not exist so many thousand years for no reason. The lndian Race is the Most Advance and Complex. From the Earth to the Whole Cosmos, the lndian knows them all. Plus they have all the Deities enlightening and protecting them.
@All,
IT IS A CHEAP WAY FOR DBS INDIA TO BUY 550+ BRANCHES. After over 25 years, DBS only has 30 branches in whole of India. That is the main reason. The $463M is to pay off LVB's external debts.
DBS India is a separate company from DBS in Singapore. DBS India is registered & domiciled in India and is an Indian company owned by DBS Ltd. Just like Maybank Singapore or Citibank Singapore is separate from their Malaysian or US head companies.
They could have named their Indian company as Vanakam Bank, instead of DBS India.
IS THIS A FORCED NATIONAL SERVICE BY INDIAN GOVT???
NO. It is business decision, but with risks of not being able to merge & modify ex-LVB's operations & staff. LVB mentality & way of operating is VERY different from DBS India --- that's what got LVB into such big shit in the 1st place.
DBS India is more "professional", conservative, and cold & calculated. Staff need to seek & pass compliance & approvals on much more levels than in typical Indian private banks. Many of LVB's existing customers won't be able to work with DBS India-type of mentality. And DBS India will be more than happy to kick out such customers.
Of the 550+ LVB branches, DBS India (if they really buy over LVB) will probably have to close 20% of them.
BETTER TO BAIL OUT HYFLUX THAN INDIAN BANK???
NO. Hyflux is deader than LKY. Singapore already did NS by taking over Tuas Spring in May 2018. The rest of Hyflux is only good for the rubbish dump.
LVB currently is a shitty bank. But DBS India is not buying it for its shitty business. It is buying LVB for its branches. And shareholders of LVB are losing all their money, just like Hyflux shareholders.
Whether DBS India can roll out attractive products for the Indian masses, & utilise the hundreds of branches to reach out to the masses, remains to be seen.
Think so easy to fire an Indian worker? Think of the unions and the strikes that would follow.
550+ branches, how many workers are there to retrench and how much to pay? How much more to pay the depositors, $1b?. $463m to pay off debtors only.
The total cost could be more than a billion. Hopefully DBS India could turn it around and not be sucked into an bottomless pit.
It is not Christmas in India. It is Deepavali time. DBS is Deepavali Bank of India now. In Red Dot it will become Deepavali Bank of Singapore. In time to come, in time. Forked tongues are very dangerous entities.
The market is always right and the market has spoken.
DBS shares closed down 0.9% Thursday, well under-performing its local rival UOB which finished up 0.4% in sharp contrast, as news of the audacious India government and central bank's bailout directive weighed on South East Asia's largest lender.
An analyst said that with the Singaporean bank's thrust into digital mobile banking to serve the India populace, the physically run-down small money-lender-looking banking branches of the ailing LVB are largely irrelevant.
Overall market sentiment is weary of DBS's audaciously high risk gamble in India.
India has a triple whammy at present - increasing Covid-19 casualties, very poor economic performance and beginning of political instability, plus trying to raise a border war with China as well as Pakistan.
I don't like to gamble. I also dislike others to use my money (even one dollar only) to gamble.
Therefore, I have already transferred all my money from DBS and POSB to UOB and Bank of China and closed my accounts with DBS and POSB.
Better be safe than regret later.
How many lost their pants in the Lehman Bros case and how much help was given to local investors? Why is DBS bank throwing money to help depositors in failing Indian Banks and doing nothing during the Lehman Bros crisis? Is it because DBS bank is now under Indian control? I am flabbergasted! Santa Claus visited Hindu India early this year!
Charity begins in India. Hahahaha
DBSI's LVB bailout also bailout LVB's Indian creditors?
Creditors of smaller Indian bank lenders may have reason to cheer the central bank’s approach to the rescue of Lakshmi Vilas Bank Ltd., which contrasts with the bailout of a larger local bank earlier this year.
For one, the merger plan laid out by the Reserve Bank of India late Tuesday envisions the white knight -- DBS Group Holdings Ltd.’s India unit -- taking over the lender’s debt. That’s in part a consequence of a crucial difference in the proposed deal structure that contrasts with the rescue of Yes Bank Ltd. in March.
DBS’s India unit will merge with Lakshmi Vilas, unlike in Yes Bank, where the rescue investors simply took financial stakes in the bank and pumped in capital, without actually combining entities and assuming their debt.
The plan also doesn’t make an explicit provision for writing down any of the debt of Lakshmi Vilas before the merger -- unlike with Yes Bank, where the lender’s Additional Tier 1 bonds were specifically written down.
Creditors may do well though to avoid reading too much into the new approach. Lakshmi Vilas is far smaller than Yes Bank, making it easier to digest. Finding a buyer willing to take the same creditor-friendly approach may be harder to replicate with larger lenders.
- Bloomberg
"Finding a buyer willing to take the same creditor-friendly approach may be harder to replicate with larger lenders." - 'willing to take' sure or not?!
All of you not to worry. The Indians would self check themselves. Everything will be transparent and above board. Everything has been thought through by the best brains in DBS India.
550+ branches, how many years of operation? How long would it take to check the accounts?
How many hundred man years to check?
The biggest question is:
1."How can DBS turn around?
Followed by the following:
2.How long will it take DBD to turn around?
3. What happens if DBS is unable to turn the bad situation around? Instead it gets into deeper shits and gets turn round and round and round around the malfunction bushes (ambushes)?
4. How much "under-table" money has DBS to pay the cunnung foxes and slimy double-headed snakes?
5. What if it turns out like the Layman Brothers?
6. Will DBS draw into POSB's money again if the losses suffered would become too much for it to deal?
7. What is the role of India's Central Bank after DBS took over the Laksmi Vilas? Will it interfere in the running of the banks by coming out with new restrictive and unhelpful regulations? Will it throw spanners and obstacles into the path forward for DBS Singapore and DBS India Group?
Moral of the story:
Fools rush in where Wise men fear to threat.
Greed has no equals in the land of the well-known highly caste-sytemised corrupted country, which is also well-known as the most dangerous and deadly rapists' country in the world.
PS: DBD stands for Development Bank of the Damned.
Not to worry, the world's best talents are working for the interest of Singaporeans and there is absolutely nothing to worry about. Trust them, have faith. The future for DBS in India is very bright, caveat, if it is not nationalised by the Indian government one day.
Anyone who trust a foreigner who has betrayed his own country by taking up citizenship with another country, because of greener pasture, and better paying job and status, no difference from a money-minded mercenary, must be an idiot. No wonder LKY called Singaporeans DAFT.
Indians are over the moon as they realize they now have a cash-rich foreign white knight on standby to bail out any Indian bank that may collapse.
Ecstatic India media are waxing lyrical praises on the Reserve Bank of India for its novel new approach to solving the Indian banking sector woes without costs to their government; and leaving bank employees, depositors as well as creditors all protected.
Singapore is solving their unemployment problem, their education problem, and now their bank failure problem.
How much it cost Singapore to be doing these these and what did Singapore get from it?
Modi and his merry men must be laughing at the stupidity of our imbeciles, doing whatever Modi wanted them to do, unable to resist, cannot resist, and losing OPM in the millions and billions, making India richer and richer.
Modi may be thinking of issuing their national awards to some of the imbeciles to make them think they are well loved by India.
Modi is bidding his time, waiting for the right moment to nationalise DBS India.
RBI board member Manish Sabharwal on Thursday praised the central bank on its proposal to merge Lakshmi Vilas Bank (LVB) with the Indian arm of Singapore-basedDBS Bank, saying the scheme is a new template where a distressed private sector entity is rescued by another private player.
"RBI has done a remarkable job with the template that gets created...(in) the DBS and LVB deal. It's new template, where private distress is solved by private sector rescue. Shareholders get wiped out, depositors and others are fine," Sabharwal said.
Absolutely 'nothing' to worry about! In no time DBS India will be nationalised by Modi. Then it will really be 'NOTHING' left to worry about.
How many more Indian banks are queuing up to declare insolvent and waiting to be saved by DBS India? With so much money, it can save a lot of failed banks in India and become the biggest Indian bank.
Who in the world is dumb enough to want to merge with a failed bank? Shareholders themselves would have been running for their life as far away as possible, once news of potential insolvency crops up.
Did they always say 'Fools rush in where wise men fear to tread'?
The irony is that Singaporean banks are being told by MAS to cap dividend payments to buttress capital structure in the face of challenges from COVID-19, and here we have $463 million being sent to India to fill a hole.
Hope it is not a big 'black hole'. The fear is who is forcing the hand of DBS India and will there be more Indian Bank failures coming DBS India's way?
Not being a DBS bank shareholder, there is no interest for me in how the shares move or dividend payouts, but my only interest is as a depositor. Safety is my concern.
"Almost one-fourth of the bank’s advances have turned bad assets. Its gross non-performing assets (NPAs) stood 25.40 per cent of the advances as of June 2020, as against 17.30 per cent a year ago, and total deposits were pegged at Rs 21,161 crore." The lender had not been able to raise adequate capital to address issues around its negative net-worth and continuing losses.
That 25.4% bad loans was at June 2020. Since then, as continuing losses mount amid the COVID-19 pandemic with India particularly badly hit, the percentage of NPAs is likely to have increased substantially in the past five months.
That $463 million being sent to India is probably in anticipation of a bigger hit. Money down the drain?
Indian banks have the habit of lending money to one big borrower. When that borrower defaults, the whole bank collapse. It is a corrupt system, simple as that.
Post a Comment