Banking and Financial News – 28 May 2014

RBI eases forward forex contracts norms for importers – Providing importers with greater flexibility in hedging, RBI has allowed them to book forward foreign exchange contracts up to 50% of the eligible limit. (The Hindu)

RBI directive to NBFCs – RBI has directed NBFCs to round off all transactions to the nearest rupee to avoid unnecessary discomfort to public. (The Hindu)

Cooperative banks told not to give large loans to PSUs - RBI says such lending goes against urban cooperative banks’ original mandate of funding small borrowers. The primary function of cooperative banks is to help meet the credit needs of society by providing loans and advances to small borrowers, agriculture and small businesses, RBI said. This meant that granting high value loans to PSUs diluted the cooperative character of UCBs. (liveMint)

Important Financial Terms in the News explained.

Hedging: Making an investment to reduce the risk of adverse price movements in an asset. Normally, a hedge consists of taking an offsetting position in a related security, such as a futures contract.

Smile, things are working out. You may not see it now, but just know God is directing you to a much greater happiness. ~ Anonymous

Courtesy : The Hindu , liveMint