A fine interpretation by Osho

Two unbelievable videos.

When Bankers Joke

Bharat Financial Inclusion ( Wholly owned subsidiary of IndusInd Bank) recently admitted to a technical glitch. The glitch resulted into:

84,000 loans were sanctioned without customer consent.

The ones who are in real trouble is:

• IT Department
• Regulatory team
• Risk Management team
• Internal Audit team
• Chief Financial Officer
• Chief Operating Officer
• Managing Director

The big question:

An article stated that this issue was highlighted by the field staff within two days and the technical glitch was rectified expeditiously.

If above statement is Big Yes, then did IndusInd Bank reported Stock Exchange about this issue?

If No, then serious action should be taken on the Board of Directors of IndusInd Bank.

So how the Bankers Joke.

After disbursing 84,000 loans without customer consent, the bank stated that:

“The bank wishes to reiterate that there is a strong risk management and control framework in place, both within the bank and at BFIL. Nevertheless, the bank has been following a conservative provisioning approach and reiterates that there is no change in the credit cost estimates including that in the micro-finance business…In October 2021, nearly 100 per cent of the loan disbursements were in the bank accounts of the customers, as in pre-Covid time,’’ 

Mumbai = Kolkata

The impact of Antilla Bomb Scare has finally got rolled out. Headline of Economic Times says it all:

Namaste, London! Ambanis set to move to Buckinghamshire mansion which has 49 bedrooms & mini hospital, says report.

Richest Indian post independence, Mr. Mukesh Ambani, has to move to London for second home. This will in coming years (or already) may be the place where Mr. Mukesh Ambani's grand children will be raised.

Remember, construction cost of Antilla is considered as USD 1 billion  dollars - USD 2 billion dollars.

Lets visit one old article from Economic Times dated September 03, 2001:

Is Mumbai following the Kolkata of ‘60s?

Article states that:

It's becoming something of a fashion these days to say that Mumbai is going the way of Kolkata in the late sixties, when dirt, filth and violence combined to drive good people out of that throbbing metropolis. unwelcome as such comments might be there is more than a grain of truth in such utterances. Kolkata was one of the safest cities to live in. then something strange happened. politics, always big in Kolkata, got more dominating, less tolerant.

May be Mr. Ambani felt that if they are unsafe and vulnerable to political mischiefs then it is time for them to move out. 

Is this an imminent signal that there is going to be a space left open by this move.  Some questions which future will answer:

• Is this the signal of Mumbai losing its financial power status?
• Is Bengaluru overtaking Mumbai in Fintech ? (as on September 8, 2021) Mumbai has 924 fintech start ups against Bengaluru with 832 fintech start ups.
• Does this indicate a lack of faith on the Governments / Political rulers?
• Will this have an impact on the hold of Mr. Mukesh Ambani family in political circles in India? in coming decades?
• Is there some more of the Super Rich in Mumbai will move out because of Antilla and Ambani move?
• Will there be an emergence of new political group in Mumbai within two decades? 
• Like Kolkatta had Mamta who will be in Mumbai?
• Who will take the blame?

How long will it take, may be another 20 years.

Important Update:

Reliance Industries Ltd. rejects the report presented in Economic Times.

Reliance rubbishes media report, says Mukesh Ambani, his family have no plans to leave India

Will have to wait and watch the school where the Grand Children study, this will be an indication.

Learnings of a Value Investor

Sometimes, even advocates of Value Investors do not know what happens in their investment.

First message from Fundoo Professor

Fundoo Professor

@Sanjay__Bakshi

Anyone else getting such emails even though they don’t have a locker with the bank branch?

@HDFCBank_Cares

Second Message from Fundoo Professor acknowledging the knowledge:

Fundoo Professor

@Sanjay__Bakshi

Problem resolved. Turns out my wife is joint holder of a locker with her sister and unknown to us the sister went to the locker. . Thanks

@HDFCBank_Cares

for clarifying to my wife.

9:17 PM · Oct 21, 2021·Twitter for iPhone

Link: Fundoo Professor

Message

"I like people admitting that they were complete stupid horses’ asses. I know I’ll perform better if I rub my nose in my mistakes. This is a wonderful trick to learn.”

Munger

Faces for Yes Bank

Article: Yes Men at Yes Bank, and Elsewhere: ‘Phone Banking’ in the Private Sector

Author : Hemindra Hazari

Hemindra has presented faces for Yes Bank Fiasco besides Rana Kapoor. They are reproduced below:

Remember this people are professional with qualifications worth envy.

Article / blog post is worth reading.

Remembering JRD

On the eve of Air India going back to Tata Group, Shyam Sekhar (Investor) provided a link which covered the interview of JRD by T N Ninan, appeared in India Today. Interview was dated August 15, 1986.

Interesting (select) part from the must read interview is reproduced below:

Q. To start by looking back, what do you think are the major changes in Indian business in the 50 years that...

A. When I started in business - nearly 60 years ago - the conditions were very different to what they became. There was no licensing system, so there was nobody to bribe. Business was reasonably honest. The taxes were reasonable. So there was no great inducement to evade taxes.

But then came a controlled society, under the impulse of Jawaharlal. The Government needed money to run elections, and the whole culture changed. Along with this came punitive taxes of 98 percent. When you have a licence-permit raj and very heavy taxes, you get tax evasion, black-marketing, and corruption.

Q. You think controls and political corruption went together?

A. We know that enormous fortunes were made, enormous sums were sent abroad. During those 30 years, I haven't heard of a single businessman who was sent to jail.

Q. This has been your biggest frustration?

A. Yes of course. And even on things that were not business. I was the first in India 35 years ago to sound the alarm on the population. I made a speech. I was wrapped on the knuckles, whom do you think by? Nehru. His words will always ring in my ears: "Nonsense, J. A large population is the greatest source of strength of any nation." And after that, we've added 350 million people.

Q. Didn't you argue with him?

A. You don't argue with Jawaharlal. He didn't want to discuss it. But the interesting thing was I was a good friend of his. He trusted me. He knew I admired him. But he knew I disagreed with all his economic policies, and I even didn't agree with his foreign policy. I felt that Krishna Menon and others like that were pro-Soviet. So I never was able thereafter to discuss economic matters.

Q. Did you try?

A. Yes. He and Mrs Gandhi later developed this similar little polite way of telling me to shut up. Jawaharlal, when I started to bring up the subject of economic policy, would turn around and look out of the window. Mrs Gandhi did something else.

Q. She doodled?

A. Yes, she doodled. Doodling I didn't mind so much. She started picking up envelopes, cutting open the envelopes and pulling out letters. It was a polite indication that she was bored.

Many a times interview from past reveals truth which we have forgotten today.

Thanks Mr. Shyam Sekhar

IBC Summary

Indian Bankruptcy Code (IBC) summed up nicely by Moneylife:

The media euphoria is about the banks as well as bond and deposit holders receiving a tidy sum of cash as settlement. But the fact is that a significant part of the settlement, amounting to Rs19,550 crore, is by way of 6.75% coupon debentures payable half-yearly. The debentures are redeemable over a 10-year period in a phased manner. The cash settlement, according to news reports, is only the balance sum, which conveniently uses about Rs3500 crore already in DHFL.

The same happened in the case of Ruchi Soya. The new owner immediately got funding from State Bank of India ( SBI) who was also the loan provided for Ruchi Soya.

In few year some one will write similar about Bad Bank.